Hot Sauce Market - Forecast(2023 - 2028)

Key Takeaways

• Geographically, the North America Hot Sauce Market accounted for the highest revenue share in 2021. The growth is owing to diverse cultures, heavy consumption of RTE food, high disposable incomes, and the presence of prominent players in the said market. Furthermore, Asia-Pacific is poised to dominate the market over the period 2022-2027.
• Enlarging longings for peppery food, spiraling foodservice industry, strengthening the retail network, and growing living standards of people in developing countries are said to be preeminent drivers driving the growth of the Hot Sauce Market. Whereas, strangled demand and supply and health hitches accompanied by excess consumption are said to reduce the market growth.
• Detailed analysis of the Strength, Weaknesses, and Opportunities of the prominent players operating in the market will be provided in the Hot Sauce Market report.

Hot Sauce Market Segment Analysis-By End-User

The Hot Sauce Market based on the end-user type can be further segmented into foodservice providers (restaurants, hotels, cafés, street vendors, and others) and households. The households segment held the largest share in 2021. The growth is owing to rising awareness among people regarding the existence of such products. As a result, hot sauce has found its way into millions of kitchens worldwide. Also, cultural exchanges because of globalization are providing people a more inclusive exposure to diverse cuisines. Moreover, the food service segment is estimated to be the fastest-growing with a CAGR of 6.5% over the forecast period 2022-2027. This growth is owing to the humungous requirement of condiments like hot sauce as serving food is the core business of these hospitality venues. Also, relaxation in the COVID-19 restrictions is reviving the demand.

Hot Sauce Market Segment Analysis-By Distribution Channel

The Hot Sauce Market based on distribution channels can be further segmented into Offline (Supermarket/Hypermarkets, Convenience stores, brick-and-mortar) and online. The offline segment held the largest share in 2021. The growth is owing to benefits like instant purchase options, one-stop solutions, easy returns, wide-ranging existence in impoverished areas, sale support, and others. Furthermore, the online segment is estimated to be the fastest-growing with a CAGR of 6.7% over the forecast period 2022-2027. This growth is owing to ever-growing digitalization. With rising smartphone users, the percentage of the tech-friendly population is witnessing a sheer surge. Moreover, owing to conveniences like 24/7 availability, better deals, strong marketing strategies, better product comparison, and tine saving nature of e-commerce purchases have allured millions of people around the world. In addition to that, to enhance customer experience, many e-commerce companies have started offering to save day delivery to customers which is anticipated to propel growth further.

Hot Sauce Market Segment Analysis-By Geography

The Hot Sauce Market based on Geography can be further segmented into North America, Europe, Asia-Pacific, South America, and the Rest of the World. North America held the largest share with 41% of the overall market in 2021. The growth in this segment is owing to the factors such as heightened demand for diversified food flavors. Hot sauce has become an indispensable part of kitchens in Canada and the US. The US is widely known as a melting pot of cultures as every year millions of people of different ethnicity and culture migrate to the U.S. in search of better jobs and career prospects. Therefore, diverse cuisine culture is paving way for the hot sauce market. Moreover, owing to developed economies people in Canada and the US enjoy high purchasing power which is another factor propelling the growth of the aforementioned market in the said segment. In addition, the trend for ready-to-eat foods is wat higher in North American countries as compared to other parts of the world. However, Asia-Pacific is expected to be the fastest-growing segment over the forecast period 2022-2027. This growth is owing to the rising economic prosperity of developing nations. Moreover, countries like India are a continent in themselves as they are home to diverse cultures and cuisines. Additionally, bettering retail chains' networks has its fair share in propelling the market growth.

Hot Sauce Market Drivers

The enlarging adoption of RTE foods with expanding modernization is anticipated to boost market demand

Because of a lack of adequate resources and industrialization people in bucolic areas don’t get proper excess to growth opportunities. Therefore, every year millions flee their homes to cities in their quest of searching for a good job and leading a happy life. As a result, the urban population around the globe is mounting quite rapidly. For instance, as of 2022 urban stands around 4.46 billion; however, the figure is anticipated to reach 6.68 billion by the year 2050. As the urban population is rising, so are the living standards of people. The trend of ready-to-eat and fast foods have heightened in recent years which is driving the growth of the hot sauce market.

Rising GDP per capita is expected to boost market demand

Besides countries like Luxembourg, Liechtenstein, and Ireland that have per capita over $110,000, the GDP per capita of several European Union countries has reached over $65,000 which is way higher compared to other parts of the world. As a result, people residing in these countries enjoy quality lifestyles. However, the world is witnessing a drastic shift in wealth from west to east. Asia has emerged as a new wealth center as exports from developing countries like China and India are sky-rocketing. According to a report published by Global Times, despite the pandemic, Chia’s GDP per capita income in 2021 reached $12,551. Later that year, China declared itself free from extreme poverty. Consequently, with growing affluence, it is becoming easy for people to make purchases easily.

Hot Sauce Market Challenges

Health issues connected with overconsumption coupled with demand and supply mismatch owing to the pandemic are anticipated to hamper the market growth

The downside of consuming too much hot sauce is that it can set complications like loose motions, vomiting, and severe digestion issues in motion. Similarly, spicy foods increase the threat of developing piles problems over time which can challenge the growth of the hot sauce market. In a survey by Kalsec, in the U.S., among consumers aged 18 and older, 80% of consumers enjoy hot and spicy foods. Over half of those surveyed eat spicy foods at least once a week. In addition, the frequency of consumption and heat levels of hot and spicy foods continues to rise causing many health issues. In addition to that, there is a gigantic disparity between demand and supply as the world is seeing a new virus variant every 2 or 3 months.

Hot Sauce Industry Outlook:

Product launches, mergers and acquisitions, joint ventures, and geographical expansions are key strategies adopted by players in the aforementioned Market. The Hot Sauce market top 10 companies include-

1. Garner Foods
2. Kraft Heinz
3. McIlhenny Company
4. McCormick
5. B&G Foods
6. Schwarts
7. Baumer Foods
8. Conagra Brands
9. Unilever PLC
10. Campbell Soup Company

Recent Developments

• On December 30, 2020, Maryland, United States-based McCormick & Company (a firm well-known for its condiments, spices, and seasoning mixes) declared that it has successfully acquired a full ownership interest in US-based FONA International (a company that manufactures flavors). A payment of $710 (cash) was made by McCormick to bring the acquisition to a close.
• On December 1, 2020, New Jersey, United States-based branded food company “B&G Foods” announced that it has successfully acquired oil brand Ionic Crisco from Ohio, United States-based food manufacturing company “The J.M. Smucker Company.” The total value of the transaction stands around $550 million (all in cash). Besides an oil brand, B&G has added a manufacturing facility to its Assets.
• On August 2, 2019, New Jersey, United States-based Campbell soup Company (a firm that deals in snack and food processing business) announced that it has successfully reached an agreement with US-based investment firm “KKR.” According to the agreement Campbell agreed to sell some of its operations to KKR. Moreover, Campbell will receive an astounding payment of $2.2 billion on completion of the deal.

Relevant Reports:

Europe Sauces, Dressings & Condiments Market – Forecast (2022 - 2027)
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