Deloitte has launched its eighth annual Global Powers of Consumer Products, with apparel one of the weakest categories in Australia.
This report identifies the 250 largest consumer products companies globally and analyses performance in local subsectors.
The world’s 250 largest consumer products companies generated sales of nearly US$3.1 trillion in the fiscal year 2013 (which encompasses fiscal years ended through to June 2014).
This resulted in an average company size of US$12.3 billion, according to the report.
Deloitte partner and consumer products industry leader Katie McNamara said there are interesting trends for retailers to note.
"The fall in the price of oil is having a considerable impact on the global economy, with increased disinflationary pressures, especially in developed markets such as the US, Europe, and Japan.
"It is boosting consumer purchasing power in oil-consuming nations such as Japan, India, the US, and much of Europe, and contributing to faster economic growth than would otherwise be the case."
Just one Australian consumer product company resides in the Global Top 250 (Coca-Cola Amatil, 151st), however almost a third of the companies have business operations in the country.
The world’s largest meat processor, JBS, joined the Global Top 10 as it completed its acquisition of Australian-owned small goods manufacturer Primo.
McNamara explained the attractiveness of the Australian market is being driven by positive business conditions where macroeconomic factors, such as the falling value of the Australian dollar and new free trade agreements, are increasing our global competitiveness.
"Firm consumer confidence levels remain a key positive driver for the consumer product sector.
"The strong showing by Asian companies in the Global Top 250 highlights the regional opportunities on our doorstep.
"Given the growing Asian middle class and their desire for fresh, clean and safe produce, Australian consumer goods is a strategically appealing industry, with significant opportunities in consumer products, food and beverage, manufacturing, dairy and other agribusiness," she said.
This growing appetite for high end, premium product was reinforced by another recent Deloitte report.
"In Positioning for Prosperity we suggested the opportunity for Australian producers is the need to move from producing commodity products to growing, processing and supplying premium produce," McNamara added.
"We’re beginning to see a shake-out of the well-established players occurring alongside the emergence of specialists operating in the premium space where they are in a great position to exploit new market growth."
Australian trends in the consumer products industry
Sector performance within the consumer products industry has been significantly varied:
§ The apparel, print and machinery subsectors have struggled with low to negative growth rates over the last couple of years and are forecasted to deteriorate even further
§ The transport and logistics industry has performed well and is forecast to continue to benefit from social and demographic trends, the growth of online retail and the shift towards direct-to-consumer channels
§ Agribusiness has experienced growth thanks to increased global opportunities. However, market fragmentation remains the key constraint to increased production, greater cost efficiencies and higher earnings
§ Food and beverage manufacturing has faced moderate growth due to higher cost of doing business in Australia in the face of strong internal competition.
