There is wide agreement in the public debate that the food industry in Western industrialised countries is entering a difficult period. Several tendencies taken together work to increase the competitive pressure on food companies (Grunert et al., 1996): - In affluent economies, it is one of the laws of economics that growth in markets for food products, if any, is not in terms of quantity, but in terms of value. - Most industrialised economies are characterised by an oversupply of agricultural products. - A global tendency towards deregulation, decrease of government subsidies to producers of agricultural and food products, and reduction of trade barriers removes many of those shields which have protected food companies from competition in some countries. - Consumers are believed to become less predictable in their behaviour, as consumer demands become more fragmented and less consistent. - Concentration in the retail sector has resulted in powerful agents. Not only do the agents exercise an important gatekeeper function but they can also put competitive pressure on food manufacturers.
Agricultural Marketing and Consumer Behaviour in a Changing World, 1997, p. 3-30