CONFECTIONERY IN SOUTH AFRICA

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Regional distribution for chewing and bubblegum follows a similar profile, with above 70% of the volumes consumed in the high population density areas of Gauteng, KwaZulu-Natal and Western Cape. Channel distribution however differs by category. Chewing gum distribution is concentrated to the general retail channel which contributes an almost 50% share to market volume. Bubble gum channeling on the other hand is dominated by independent wholesale which controls over one third of the market. Source: BMI Click here to find Chewing Gum brands

Chocolate slabs lost some share to speciality chocolates in the base year to contribute 52.4% to total volumes, reflecting a 3.7% share decline from 2009 levels. The chocolate slabs category returned to near pre-recession levels in 2010, with 8.6% growth recorded. The market for slabs is expected to experience marginal volume decline in 2011 and to maintain stable volumes in 2012. The price of slabs remained fairly constant in 2010 but is expected to rise in 2011 due to political unrest in Ivory Coast; the world’s largest cocoa producer. The price of cocoa hit a new high in February 2011 driven by a ban imposed on cocoa exports by the president elect, in a bid to oust the former president from controlling key sectors. The ban, which was expected to be lifted on the 15th of March 2011 was extended to the end of the month. The rise in ingredients costs has already seen chocolate giants reducing slab sizes, both internationally and locally, in a bid to remain profitable. In the British market, 2011 will see further reductions of popular favourites with Toblerone expected to shed off one triangle and Dairy Milk bars expected to loose a few chunks. The reduction in size is not only price driven but health driven with smaller portion sizes expected to help tackle the obesity epidemic. Source: BMI Click here to find Chocolate brands

General retail continues to be the main distribution channel for gums and jellies with 42.3% of the industry’s output distributed via this channel. Volume channeled to wholesale chains shrunk by 10.1%, while independent wholesale maintained its volume with a marginal growth rate of 0.9%. Regional distribution remains concentrated to high population density areas with Gauteng, KwaZulu-Natal and Western Cape contributing close to two thirds of the total volume. Source: BMI Click here to find Gums & Mallows brands

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Growth in the speciality chocolate market was experienced across all three categories, with boxes, packets and novelty chocolates experiencing 38.5%, 16.2% and 36.3% growth respectively. The category is expected to remain stable in the medium term. Several factors contributed to the good performance of the speciality segment: Increased manufacturer focus on boxes and novelty chocolate due to growing demand for authentic South African chocolate in the foodservices market. Notable growth was seen in the import market, with increased volumes seen across all three speciality chocolate categories. Some smaller local manufactures cited the increased threats of cheap imports. New product launches in the boxes and packets categories by smaller manufactures were contributing factors to higher volume growth seen in 2010. The pricing issue will perhaps be the biggest challenge faced by most speciality chocolate manufacturers going forward as they strive to balance the price/ quality perception of their products.  Click here to find Speciality Chocolate brands

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In South Africa, boiled sweets are the most lucrative market within sugar confectionery with over one quarter of both volume and value totals. Niche offerings within this category include liquorice, other sugar confectionery as well as éclairs. There is a relatively higher concentration of small regional players in this category than in chocolate, bars and gum, possibly because of lower entry barriers. Independent wholesale is the dominant distribution channel used to distribute sugar confectionery in South Africa with over a third of the volumes sold through this channel. General retail and wholesale are also very popular distribution channels with over 50% of the industry’s volumes channelled this way. Similar to other confectionery products, regional distribution is concentrated in densely populated areas. Source: BMI Click here to find Sweets brands

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