The meals and beverage trade has been underneath immense strain in recent times as elevated prices, ensuing from components together with local weather change and geopolitical unrest, have taken their toll. Added to that, the cost-of-living disaster has hit customers arduous, tightening budgets and changing buying behaviours.
Nevertheless, regardless of these challenges, exercise within the mergers and acquisitions market has offered positive news for the food and beverage industry.
What’s extra, sure meals and beverage traits have emerged and developed into unstoppable juggernauts, bringing customers and types with them. However what’s the largest and most dominant development within the meals and beverage world? Properly, many would argue it’s wellness.
Shoppers are embracing wellness in a means that few may need predicted, even only a decade in the past. However its simple reputation has taken it to a world worth of 5.61 trillion USD, based on market perception agency, Statista. Moreover, this determine is projected rise to an estimated 8.47 trillion USD by 2027.
Taking a look at this development extra intently, we discover a myriad of smaller traits inside it. Gut health being one of the extensively recognised. Sports activities diet being one other, with a CAGR of 9.0% since 2019 and a projected worth of 33 billion GBP by 2028. And this success has led to a flurry of exercise inside the mergers and acquisitions market.
The truth is, M&A exercise within the EMEA sports activities diet sector has been significantly lively, with eight notable offers thus far in 2024, as a continued shift in client behaviour in direction of well being and health drives market progress.
Why has sports activities diet turn into so common?
Curiosity in sports activities diet has been steadily rising inside the wellness development over the previous decade. The place it was as soon as thought of the choice of gymnasium fanatics, lifting weights whereas watching themselves within the mirror, it has now firmly entered the mainstream, with folks of all ages and sports activities preferences selecting them to refuel.
“Sports activities diet foods and drinks enjoys surprisingly widespread use regardless of its particular perform as supporting sports activities and health,” says Emma Clifford, senior foods and drinks analyst at market perception agency, Mintel. “Consequently, gross sales are booming and on the coronary heart of this robust efficiency is that the attraction of those merchandise is increasing past the small pool of probably the most elite sportspeople and gymnasium followers.”
However why have sports activities diet meals and drinks, sometimes called useful meals and drinks, turn into common with the informal client? It seems that the reply lies in life-style.
“The class is more and more attracting ‘life-style’ customers who see these merchandise becoming in with a wholesome, lively life-style,” says Clifford. “Fuelling the shift in direction of the mainstream use is the rising availability and visibility of accessible snacks and drinks from sports activities diet manufacturers.”
What’s extra, social media is having a significant impression on client behaviours, with influencers setting traits and, fairly actually, influencing their followers. What’s extra, the phrases #health, #fitspo, #fitfam, and #fitgoals, now dominate social media as a few of the most searched and posted-about types of content material. That is in parallel to the decline in alcohol consumption throughout Europe.
“There are clear traits away from unhealthier life-style merchandise, for instance the consumption of alcohol has been declining for fairly a while,” Mark Lynch, accomplice at company finance advisory agency, Oghma Companions, informed FoodNavigator.
So which sports activities diet meals and drinks are proving significantly common with customers, driving market progress and attracting funding?
“Drinks, protein powders and extra not too long ago protein snack bars have helped to drive sector progress and due to this fact are the engaging areas for patrons to have a look at,” says Lynch.
What’s subsequent for the sports activities diet development?
Whereas nobody can predict the long run, it’s a reasonably secure wager to say that the sports activities diet development is right here to remain. However how will the sector evolve?
The reply to this appears to be via improvement into different meals and beverage areas, attracting customers from totally different demographics to the present youthful generations.
“An attention-grabbing space going ahead would be the crossover between sports activities diet and diet for seniors – it is a promising space of focus,” says Oghma Companions’ Lynch
The continued progress of the high-protein meals and drinks development can also be more likely to function closely in sports activities diet.
“The wide-ranging advantages linked to protein have been liable for pushing it into the highlight within the context of wholesome consuming,” says Mintel’s Clifford. “These a number of constructive associations imply that utilization of high-protein merchandise just isn’t restricted to customers with a single dietary need or want.”
Furthermore, the continued power of the market will doubtless encourage additional funding in sports activities diet merchandise and types.
“Wanting forwards, we anticipate relative valuations to stay wholesome and the next quantity of bigger offers as financial circumstances proceed to enhance,” says Oghma Companions’ Lynch.
