Industry Analysis & Industry Trends
Over the past five years, the Potato Chip Production industry has grappled with major shifts in downstream consumption patterns, the rising cost of key raw ingredients and increased competition from substitutes, imports and private-label products. The ongoing rise in health consciousness has encouraged a general shift towards healthier eating patterns and a decline in popularity for unhealthy snacks such as potato chips, which are considered high in fat and salt. Due to these trends, industry revenue is forecast to decline by 1.0% annualised over the five years through 2013-14. The increase in health consciousness has also made the industry particularly vulnerable to the threat of healthy snack food substitutes such as fruit and nut bars or wholegrain crackers... purchase to read more
Industry Report - Industry Investment Chapter
The Potato Chip Production industry has a medium level of capital intensity. IBISWorld estimates that for every dollar paid as wages, industry operators require $0.15 to be invested into capital. The industry relies on expensive machinery and equipment such as industrial potato peeling, cutting, frying, drying, flavouring and packaging machines. These machines help boost production volumes, maintain scale economies and minimise wage costs.
Although wage costs have declined over the past five years, they are still relatively high compared with the overall Manufacturing division. In general, smaller companies often rely more on manual labour to track quality control in production and pack finished product... purchase to read more