The report by PricewaterhouseCoopers (PwC), 2012 Outlook for the Retail and Consumer Products Sector in Asia, noted that Asia will remain a key engine of global retail growth, with increased prosperity driving demand for functional foods.
Carrie Yu, China and Asia Pacific retail and consumer leader at PwC, said: “As growth in retail and consumer goods in Western markets is anticipated to be sluggish in the foreseeable future, emerging Asian markets hold out more robust promises for growth and expansion.”
The report noted opportunities in the functional food sector, driven not only by rising incomes but also an increase in health and food safety concerns.
It predicted sales of functional foods in Asia are set to outperform the European and US markets.
Both international and local food and beverage companies are actively engaged in R&D of health products, the report found, with multinational brands also investing in manufacturing capacity throughout the region.
The report said that established multinational consumer food firms currently have the edge over local companies due to stronger research and development expertise, marketing muscle and large budgets as well as recognised brands.
Selling food in Asia is increasingly about marketing health benefits, the report said; a point outlined by earlier analysis from Frost & Sullivan, Functional foods in Asia Pacific, that said companies need to drive public insight into the benefits of functional foods.
Radhika Puri, Frost & Sullivan associate, told FoodNavigator-Asia that health claims need to be projected clearly to consumers.
“It’s about giving the consumers the information they need; about the effects, side-effects and dosage recommendations. If manufacturers provide all of this, they will have a higher chance of succeeding in the market,” she said.
The Frost & Sullivan analysis identified diabetes, cancer, growth and nutrition, weight management and obesity and bone health as a few of the concerns facing Asia Pacific consumers.
PwC’s Carrie Yu described China as the main powerhouse in Asia, and New Zealand Trade & Enterprise, a government agency has predicted a strong growth in China’s health food market.
It forecasts the market to be pegged at RMB450bn (US$71BN) by 2015, up from RMB133bn (US$21bn) in 2010.