The chocolate industry offers a wide variety of opportunities for the small business owner, weathers economic recession well and is growing despite increased health-consciousness and calorie counting. One of the primary demand drivers for chocolate and other sweets is consumer taste, and consumers continue to love chocolate. Long a beloved treat in the western world, a recent study in Great Britain showed that 91% of females and 87% of males consume chocolate products. But the taste for chocolate is now expanding into highly populated nations with a growing middle class, such as China and India. Rising disposable incomes and changing tastes will continue to drive growth in the industry overseas, just as improving domestic economic conditions increase sales at home.

 The chocolates market is estimated at around 33,000 tonnes valued at approximately Rs. 8.0 billion. The counter market is estimated at about nearly Rs. 2.5 to 3.5 bn and the rest is made up of chocolate bars. Chocolates make up less than a fourth of the sweet-tooth products including sugar-boiled confectionery, mints and chewing gums. Sugar confectionery is by far the largest segment. To push sales, chocolate majors have been targeting adult audiences. Chocolates are being presented as snack food for the new target audiences. Another strategy sought was the introduction of smaller editions.

Although the players resorted to very aggressive promotional drives, the overall penetration levels in 1999 and 2000 did not register any significant increase. Perhaps, the increases by 5% to 15% in selling prices due to increase in cocoa prices caused the stagnation.

Chocolates

Demand: Past & Future

Year               Thousand MT

2000-01                    22.1

2001-02                    24

2002-03                    30

2003-04                    32.7

2004-05                    35.5

2005-06                    38.4

2006-07                    41.3

2007-08                    44.2

2008-09                    47.2

2009-10                    50.2

2014-15                    67.2

Market Growth Rates

1990-91 - 1996-97                  6.9%

1996-97 - 2001-02                  8.9%

2001-02 - 2006-07                  11.5%

2004-05 - 2009-10                  7.2%

2009-10 - 2014-15                  6.0%

Demand: Past and Future

Year                              MT

2000-01                      470

2001-02                      505

2002-03                      535

2003-04                      570

2004-05                      605

2005-06                      640

2006-07                      685

2007-08                      730

2008-09                      780

2009-10                      830

2014-15                      1165