Apple Chips – A Profound Market Analysis

Apples — second-most popular fruit in the world, only after bananas. This popularity is in line with the apples’ voluminous global market. A report by Fruit Grower’s news estimated the global apple market to reach 78.8 billion US dollars in 2019.

Given its numerous health benefits and affordability, apples are one of the most sought-after fruits. Apple products also hold the lion’s share in the HoReCa (Hotels/Restaurants/Catering) sector.

One of the latest, yet growing segments of the apple market is apple chips. Having carved a niche of their own, apple chips are turning into a potential rival for other fruit snacks.

Current market

The global fruit snacks market is on an upward curve. Whilst the demand is rising, the supply also is coming back to normal. This report by Grandview Research estimated the fruit snacks market at 4.92 billion US dollars in 2019.

The growth in the demand is due to the convenience provided by these snacks. Add to it the nutritional value of these snacks, and the demand is only going to rise. 

Amidst these, apple chips are establishing themselves as a concrete segment. The raw materials and machinery required are quite affordable, considering the industry is relatively new. India is one of the leading importers of apples in the world, despite housing apple-producing regions. 

However, importing apples helps in easing its procurement for the processing of apple chips. 

Trends

The growth of the apple chips market is driven by certain factors. Venturing into the market, understanding these factors shall be the best way forward. Leveraging these factors efficiently shall ensure the growing profitability of the venture.

1. Healthier diets

The past few years have testified to a significant transition towards eating healthy, and rightly so. Foods that are rich in nutrients are growing in demand. The ease of affording apple chips makes it an ideal investment to leverage the current restricted market.

2. Urbanization

The convenience of on-the-go food is increasing by the day. The urbanization of villages ensures the food habits and culture is shared too. With the corporate culture growing, the fruit snacks market is turning into a lucrative avenue.  

3. Fruit snacks in the e-commerce sector

The E-commerce sector is gradually welcoming the fruit snacks segment. With robust last-mile logistical support, the user base is widening. Aligning itself with e-commerce, the fruit snacks market shall enjoy an efficient supply chain. To further the potential, from 2020 to 2027, the online retailers’ segment is estimated to grow at a CAGR of 10.9%.

4. Governmental policies

India is a well-known importer of apples. With the government promoting the manufacturing of apples, a substantial increase in production is anticipated. With the policies favouring infrastructure development, investing in the apple chips market has never seen a better time.

Segmentation

The apple chips market is a recent entry into the Indian snack food market. The Indian snack food market’s revenue is touted to reach a value of 1 billion US dollars by 2024. 

Understanding the different segments in this market shall provide deeper insights into the growing demand.

• Chips
• Extruded snacks
• Traditional snacks

All three segments share a similar value in the Indian snack market. Namkeen — a traditional Indian snack that holds the lion’s share of the market. 

The advantage of Apple chips is their lack of specificity. Albeit them being chips, they are significantly more nutritious and healthier than their competitors. Likewise, compared to extruded snacks, they are healthier and cater to a growing health-conscious audience.

Traditional snacks are a tough competitor for apple chips, given their deep penetration into the Indian rural market. The local connection between traditional snacks and the Indian population is tough to be replicated by apple chips. Hence, concentrating on urban areas for a substantial amount of time before expanding is ideal for growth.

Future demand

According to the Indian government initiative — Invest In India, ₹ 10,236 crores worth of fruits and vegetables were exported in 2018-19. With organized retail and E-commerce gaining traction, an exponential increase in exports is achievable. 

Also, the processed fruits and vegetable market is growing at a significant pace. All these growths provide for an immense potential for a food-based venture to benefit from. With comparatively low competition, apple chips are an avenue to generate revenue. 

Conclusion

The global apple market, the Indian snack foods market are growing at a good rate. Coinciding with these is the apple chips industry. The tasty, crunchy, yet nutritious chips are evolving into a mainstream snack. 

With a developing infrastructure, investing in an apple chips venture is an apt move. Leveraging the common belief of apple being the healthiest of fruits, apple chips’ marketing is an easy task. 

The lack of competition and growing demand justifies the apple chips’ market to be the next market with tremendous growth potential.