Trouble brewing: Intense competition is expected to limit industry revenue growth

Strong consumer demand for tea and coffee products has driven revenue growth in the Tea and Coffee Manufacturing industry over the past five years. Rising disposable incomes and increased demand for premium tea and coffee products have also boosted industry performance over the period. Industry revenue is expected to grow at an annualised 3.9% over the five years through 2017-18, to reach $1.8 billion. Australia's coffee culture has supported the industry and ensured continued downstream demand from major markets, such as supermarkets and coffee shops. However, industry revenue has fluctuated over the past five years in response to volatility in the world price of coffee. Smaller operators have generally passed on these cost increases to customers...read more.

Industry Statistics & Market Size
Revenue
$2bn
Annual Growth 13-18
3.9%
Forecast Growth 18-23
Profit
Employment
3,693
Businesses
346

Industry Threats & Opportunities

  • Rising disposable incomes and demand for premium products have boosted industry revenue
  • The increased prevalence of premium tea and coffee products has driven revenue growth
  • Consumer preference for premium products over cheaper teas and instant coffee will continue
  • Industry Report - Industry Investment Chapter

    The Tea and Coffee Manufacturing industry is moderately capital-intensive. For every dollar spent on capital, the average industry operator spends an estimated $5.04 on wages. Capital intensity varies greatly among industry operators. Larger manufacturers generally invest heavily in machinery to automate production and to achieve greater economies of scale, allowing operators to reduce wage costs and increase production efficiency. Small-scale companies rely more on manual labour in the manufacturing process, as they rarely have the capital to substantially invest in machinery.Over the past five years, the number of small-scale operators entering the industry has grown, due to the rising popularity of niche coffee and tea products and smaller, independent brands. The...purchase to read more.

    Additional Insights for the Tea and Coffee Manufacturing Industry

    IBISWorld identifies 250 Key Success Factors for a business.The most important for the Tea and Coffee Manufacturing Industry are

  • Supply contracts in place for key inputs
  • Access to niche markets
  • Access to high-quality inputs
  • IBISWorld analysts also discuss how external factors such as Demand from supermarkets and grocery stores and Demand from cafes and coffee shops in the Tea and Coffee Manufacturing industry impact industry performance..

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    What's in this report

    What is the Tea and Coffee Manufacturing Industry?

    Firms in the industry primarily process and manufacture tea and coffee products from tea leaves and coffee beans. Industry firms also produce loose-leaf tea, tea bags, fresh coffee and instant coffee.

    Industry Products
  • Instant coffee
  • Coffee beans and grounds
  • Coffee capsules
  • Tea bags
  • Loose-leaf tea
  • Industry Activities
  • Coffee roasting
  • Coffee processing
  • Tea blending
  • Tea processing
  • Table of Contents

    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Executive Summary
    Key External Drivers
  • Demand from supermarkets and grocery stores
  • Demand from cafes and coffee shops
  • Real household disposable income
  • World price of coffee
  • Consumer sentiment index

  • Current Performance
  • Revenue and profitability
  • Consumer preferences
  • Industry structure
  • International trade
  • Chart: Revenue Growth

  • Industry Outlook
  • Revenue and profitability
  • Consumer preferences
  • Industry structure
  • Table: Tea and Coffee Manufacturing Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Tea and Coffee Manufacturing Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • General Line Grocery Wholesaling
  • Supermarkets and Grocery Stores
  • Convenience Stores
  • Restaurants
  • Cafes and Coffee Shops

  • Key Selling Industries
  • Agribusiness
  • Food Processing Machinery Manufacturing

  • Products & Services
  • Instant coffee
  • Tea bags
  • Coffee capsules
  • Coffee beans and grounds
  • Loose-leaf tea
  • Chart: Tea and Coffee Manufacturing Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • Retailers
  • Cafes and coffee shops
  • Wholesalers
  • Export markets
  • Other markets
  • Chart: Major Market Segmentation for the Tea and Coffee Manufacturing Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
  • Profit
  • Purchases
  • Wages
  • Other
  • Chart: Cost Structure Benchmarking – Sector vs Tea and Coffee Manufacturing

  • Basis of Competition
  • Internal competition
  • External competition

  • Barriers to Entry
  • Table: Barrier to Entry Checklist for the Tea and Coffee Manufacturing Industry

  • Industry Globalization
    Nestle Australia Ltd, D E Holding Australia Pty Ltd, Cantarella Holdings Pty Ltd, Unilever Australia (Holdings) Proprietary Limited,
  • Table: Nestle Australia Ltd - financial performance
  • Table: D E Holding Australia Pty Ltd - financial performance
  • Table: Cantarella Holdings Pty Ltd - financial performance
  • Table: Unilever Australia (Holdings) Proprietary Limited - financial performance

  • Capital Intensity
  • Chart: Level of Capital Intensity for the Tea and Coffee Manufacturing Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Table: Industry Data for the Tea and Coffee Manufacturing Industry
    Includes:
  • Industry Revenue (2009-2023)
  • Industry Gross Product (2009-2023)
  • Establishments (2009-2023)
  • Businesses (2009-2023)
  • Employment (2009-2023)
  • Exports (2009-2023)
  • Imports (2009-2023)
  • Wages (2009-2023)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Capsules
  • Coffee capsules contain ground coffee beans and a filter and are used to brew coffee using specially designed coffee machines.
  • Fresh Coffee
  • Coffee beans or grounds that are roasted and sold to consumers.
  • Pyramid Tea Bags
  • Pyramid-shaped tea bags generally contain larger tea leaves and can accommodate additional ingredients.
  • What Our Customers Say

    Why buy this report?

    IBISWorld’s Tea and Coffee Manufacturing market research report offers insightful industry analysis and research into the market at the national level. IBISWorld’s in-depth industry market research is presented in a logical and consistent format. The industry report contains key industry statistics, market size, industry trends, and growth and profit forecasts for a 5-year outlook period.

    IBISWorld industry market research reports enable you to:
    • Find out about key industry trends
    • Identify threats and opportunities
    • Inform your decisions for marketing, strategy and planning
    • Quickly build competitive intelligence
    This report on Tea and Coffee Manufacturing:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding of industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Tea and Coffee Manufacturing market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Tea and Coffee Manufacturing, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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