Five sectors set to thrive beyond the mining boom – Page 4 of 5 – StartupSmart

4. Artisan food




Australia may have a supermarket duopoly that is allegedly squeezing suppliers, but that doesn’t mean there aren’t opportunities for the right kind of products.


Over the past five years, Australia’s organic farming industry has grown at a robust pace of 11.6% per annum and IBISWorld expects the industry will continue to soar, increasing its revenue by 14.9% over 2012-13 to be worth $578.9 million.


Demand for organic produce has been mainly driven by growing consumer interest in sustainable food production and rising disposable incomes.


Supermarkets have responded quickly to increasing demand for organic products by increasing organic product ranges to improve accessibility.


This has resulted in supermarkets accounting for around 60% of all organic sales, although supply chain challenges remain an issue for organic producers.


Traditional food retail should survive and prosper too, albeit in a different form. For example, the recent financial woe faced by chocolate retailer Darrel Lea shouldn’t deter start-ups from this area.


“In the chocolate bar segment, you’re going up against heavyweights – the Nestlés and Cadburys of the world,” says IBISWorld analyst Naren Sivasailam. “It’s going to be very hard to compete with those given their brand recognition.”


“But in the premium high end – fine chocolates made experientially by expert chocolatiers – that market has been growing by about 14-15% a year.”


“Fair trade chocolate is the biggest growth segment – it has experienced growth of about 11,000% in the last five years but that’s going off a base close to zero.”


“It doesn’t mean it’s premium, but it’s appealing to certain ethical stances of consumers. Consumers care about this, and producers will lose out if they don’t tap into it.”


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