MILD DOWNTURN FOR BISCUITS CATEGORY DRIVEN BY DECLINE OF CRACKERS LINE, KEPT AT BAY WITH SALES IN TRADITIONAL CHANNELS

The Biscuits category, which includes biscuits, cookies, crackers, wafers, native flour-based dry baked goods, and other dry baked products made of flour, remained relatively stable in terms of volume and value sales for Total Philippines in YTD December 2013. Its performance is slightly skewed towards a decline which can be controlled through driving sales in key regions and channels.

While the category has no danger of crumbling just yet, its performance at the Grocery/CV channel can be seen as an area of improvement. The continuous sales growth at Sari Sari Stores and Market Stalls as well as the flat status of Supermarket sales have helped keep the category afloat.

Fig 1.1. Total Biscuits in the Philippines by Channel

Volume Sales Volume % Chg YA

Volume % Shr Of Trade

Value Sales Value % Chg YA

Value % Shr Of Trade

Total Philippines 200,691,051 -1.5 100.0 32,901,981 -0.2 100.0

Total Supermarket 100,226,907 -3.1 49.9 15,771,221 -3.6 47.9

Total Grocery/CV 30,082,650 -6.9 15.0 4,666,621 -5.4 14.2

Total Sari Sari Store 52,874,704 5.4 26.3 9,832,221 9.1 29.9

Total Market Stall 9,839,711 6.7 4.9 1,423,841 6.8 4.3

North Luzon anchors growth in the Biscuits category for Total Philippines, with Market Stalls and Grocery Stores/CVs leading – as opposed to other regions in the country, this channel sports surprisingly strong sales in North Luzon – and the stability of sales in Supermarkets helping maintain this growth. The relative flatness of South Luzon and GMA sales during YTD December 2013 have also allowed the category to remain stable.

Fig 1.2. Total Biscuits in the Philippines by Region

Volume Sales Volume % Chg YA

Volume % Shr Of Trade

Value Sales Value % Chg YA

Value % Shr Of Trade

Total Philippines 200,691,051 -1.5 100.0 32,901,981 -0.2 100.0

GMA 48,325,098 -2.4 24.1 8,349,277 -1.0 25.4

North Luzon 44,582,541 5.8 22.2 7,224,840 7.2 22.0

South Luzon 41,977,522 0.1 20.9 6,781,708 0.7 20.6

Visayas 26,342,319 -3.3 13.1 4,453,362 -0.4 13.5

Mindanao 39,463,568 -7.9 19.7 6,092,794 -7.6 18.5

Fig 1.3. Total Biscuits in North Luzon

Volume Sales Volume % Chg YA

Volume % Shr Of Trade

Value Sales Value % Chg YA

Value % Shr Of Trade

Total North Luzon 44,582,541 5.8 100.0 7,224,840 7.2 100.0

North Luzon Supermarket 15,439,873 -2.0 34.6 2,355,408 -2.9 32.6

North Luzon Grocery/CV 10,627,328 21.0 23.8 1,578,706 20.7 21.9

North Luzon Sari Sari Store 13,680,061 0.5 30.7 2,577,621 5.8 35.7

North Luzon Market Stall 2,951,529 35.2 6.6 427,153 38.7 5.9

Meanwhile, sales percentages in Visayas have dropped by a significant margin even as they remain relatively flat. Growth in Mindanao may need monitoring for having brought down the entire country category sales considerably. The decreased consumption and subsequent category decline in these areas may be attributed to the effects of the Bohol and Cebu earthquake and Typhoon Yolanda in the Visayas, and the conflict situation in Zamboanga in Mindanao, which all took place in the second half of 2013.

Rebisco continues to be the leading Biscuits manufacturer for Total Philippines, however its growth has also experienced a downturn during YTD December 2013. Its flagship brand remains the category market leader, with sibling brand Combi at number seven; what is noticeable is that its other sibling brand Hansel has fallen to fourth place due to a significant drop in volume sales even as it enjoys an advertising push on television through teen celebrity idol Daniel Padilla.

Monde M.Y. San is currently the second largest manufacturer in the category. Its brands Skyflakes in number two, Fita at number five and Graham in number 10, have all posted flat growth.

Universal Robina’s third place status is cemented by the flatness of its flagship snacking brand Jack n’ Jill; it has the chance to overtake Monde M.Y. San and even Rebisco in early 2014 if it can increase Jack n’ Jill sales up from its current number two spot.

Biscuits manufacturer Monde Nissin owns two sandwich-type brands with sales figures that have brought the category down, Bingo and Voice. However, its Nissin Wafers line is the only brand in the list to have posted increased sales, allowing it to finish at a respectable fourth place.

The snacking and food manufacturer Mondelez continues to push upward after making the transition from Kraft Foods, despite the fact that its brands have been undertaken by those of other leading manufacturers in the same category.

Fig 1.4. Top 5 Manufacturers of Biscuits in the Philippines

Volume Sales Volume % Chg YA

Volume % Share Value Sales Value % Chg YA

Value % Share

Rebisco 64,390,792 -5.6 32.1 9,216,714 -4.1 28.0

Monde M.Y. San 40,310,928 -2.5 20.1 6,923,512 -1.2 21.0

Universal Robina 28,758,402 -1.5 14.3 4,945,964 0.6 15.0

Monde Nissin 25,376,144 -3.9 12.6 4,653,774 -1.1 14.1

Mondelez 4,290,695 17.4 2.1 1,113,972 13.1 3.4

Fig 1.5. Top 10 Brands of Biscuits in the Philippines

Volume Sales Volume % Chg YA

Volume % Share Value Sales Value % Chg YA

Value % Share

Rebisco 33,403,136 -6.5 16.6 4,577,518 -5.0 13.9

Jack 'n Jill 28,758,402 -1.5 14.3 4,945,964 0.6 15.0

Skyflakes 23,565,424 -2.3 11.7 4,211,084 -0.8 12.8

Hansel 14,501,449 -9.0 7.2 2,282,137 -5.7 6.9

Fita 10,705,699 -5.0 5.3 1,795,549 -3.0 5.5

Bingo 6,054,143 -12.7 3.0 1,058,636 -8.1 3.2

Combi 5,766,663 -8.5 2.9 922,645 -7.0 2.8

Nissin Wafer 5,348,887 21.6 2.7 794,273 16.1 2.4

Voice 5,161,695 -17.4 2.6 970,314 -14.2 2.9

Graham 3,889,707 0.8 1.9 622,444 0.2 1.9