According to a new industry research report from IBISWorld, the meal replacement product manufacturing industry will experience substantial revenue growth in the next five years to 2016. This is in part due to growth in per capita disposable income that will result in more consumer spending on discretionary products.
“As Americans go back to work, many of them will have less free time and will likely demand more convenient food items. In addition, Americans will continue to struggle with weight loss and want to improve their nutrition. From 2011–2016, industry revenue is expected to increase by an average of 4.1% per year to $2.7 billion. In 2012, revenue is forecast to grow by 4.5% as consumers continue to recover from the recession,” said Mary Gotaas, IBISWorld Industry Analyst.
The meal replacement product manufacturing industry has already experienced strong revenue growth in the past five years, thanks to rising obesity rates and robust demand for convenient food products. In addition, these products are also less expensive than other forms of weight loss goods; therefore as the recession pinched, consumers continued to buy meal replacement products. As the economy recovers from the recession and disposable income rises and more people go back to work, more consumers will likely increase their spending on discretionary goods and on food products that can be eaten on the go.
However, the industry has faced some setbacks. “Rising prices of raw material inputs like milk and soybeans have negatively affected the industry’s costs. The industry also faces strong competition from weight loss services. Many Americans are able to purchase more expensive weight loss treatments as the economy rebounds and disposable income expands.”