In the dynamic landscape of China's snack food market, a major player has decided to make its entrance into the frayBimbo, the world's largest baking company, renowned for supplying bread products to global franchises such as KFC and McDonald's, is initiating a foray into the leisure snack sector with its new product offering of "Manketon Crispy Bread Cubes." This strategic shift was recently announced by Zhang Li, the general manager of Bimbo China, showcasing the company's ambition to tap into the rapidly growing snack food nicheOver the years, Bimbo has shown steady growth and significant investments in the Chinese market, adapting to local consumer preferences while expanding its brand portfolio, which includes Bimbo, Manketon, and Million Garden.

Bimbo's introduction of leisure snacks marks its first significant deviation from its primary focus on baked goodsZhang noted the immense potential for growth in the baking-related leisure snack segment in China, expressing confidence in achieving a remarkable sales milestone with Manketon Crispy Bread Cubes, aiming to transform it into a billion-yuan product

However, as Bimbo transitions into this vibrant sector, it faces competition from established names like Taoli and Meibeichen, making the competitive landscape likely more intense than anticipated.

The leisure snacks market in China is flourishing, evidenced by its astonishing market size, which has grown to surpass one trillion yuanIn 2023, estimates indicate that the market reached approximately 1.031 trillion yuan, reflecting a year-on-year growth of 6.1%. Projections suggest that by 2028, this figure could soar to around 1.338 trillion yuan, underscoring the substantial growth prospects that Bimbo aims to harnessIt's noteworthy that offline channels dominate this sector, capturing 82.6% of leisure snack distribution, while online sales only account for about 17.4%.

Post-pandemic, the offline market for leisure snacks has been further invigorated by the rise of value-oriented snack outlets

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These stores, referred to as "snack warehouses," directly purchase from manufacturers, emphasizing cost savings and a diverse product range that appeals particularly to budget-conscious consumersA notable example of this emerging trend is the "Snack Very Busy" chain, which opened its doors in Hunan in 2017. With consumer spending under pressure, budget-friendly snack retailers have begun to rapidly expandBy October 2023, over 22,000 snack discount stores had taken root nationwide, reflecting over tenfold growth in market size compared to three years ago.

This explosive growth in market size can be attributed to significant capital backingFor instance, in 2021, the "Snack Very Busy" chain raised 240 million yuan in funding, subsequently increasing its store count twentyfold within a two-year spanSimilarly, "Zhao Yiming Snacks" secured 150 million yuan in its Series A financing round in February 2023. Shortly after, major brands began to consolidate, leading to a market composition identified by the dominance of a few major players and numerous smaller competitors

Notably, in November 2023, "Snack Very Busy" announced a strategic merger with "Zhao Yiming Snacks," maintaining separate brand identities while fostering cooperative operational frameworks.

As the competitive structure solidifies, some value-oriented snack stores are increasingly exploring transformation, evolving their business models toward supermarket-style operationsThis trend is exemplified by the "Laiyoupin" brand under the "Wancheng Group," which, in December 2024, plans to launch a new supermarket strategy that expands its product offerings to include daily essentials and fresh baked goodsConcurrently, "Three Squirrels," a well-established player in the snack industry, has also begun to pivot its strategy by acquiring "Ailingshi," further broadening its market approach.

Nonetheless, Bimbo's Manketon Crispy Bread Cubes faces a myriad of challenges as it seeks to carve out space in this crowded landscape of discount snack outlets

The current environment has seen varying success among traditional snack brands, especially when viewed through the lens of three of the sector's giants: Three Squirrels, Liangpinpuzi, and LaiyifenAccording to their third-quarter reports for 2024, Three Squirrels reported revenues of 7.169 billion yuan—an impressive year-on-year increase of 56.46%, while Liangpinpuzi and Laiyifen reported declines of 8.66% and 15.96%, respectivelyThe resilience of Three Squirrels is notable, as it has managed to reverse declining trends and achieve consistent growth in recent quarters, while its counterparts face significant revenue pressures.

The disparity between these brands is not merely a reflection of market dynamics, as all three have reduced their store counts by over a hundred locations from 2023 to 2024. Conversely, some emerging brands, such as Yanjinpuzi, have capitalized on partnerships with snack discount stores, achieving remarkable revenue growth of 28.49% year-on-year and solidifying its place in the competitive market.

With the traditional snack brands confronted with declining sales, a collaborative strategy has become necessary

Some brands have opted for consolidation into the discount snack channelsIn October 2023, for example, Three Squirrels announced its acquisition of the discount brand Ailingshi, complementing its entry into the budget-friendly market segmentLikewise, Liangpinpuzi has established its own discount brand, establishing a formidable presence across Hubei province.

In response to the competitive pressure exerted by low-cost snack brands, traditional players are also reevaluating pricing strategiesLiangpinpuzi made headlines with substantial discounts in late 2023, marking the most significant price reductions since the brand's inception 17 years priorTheir average price reduction of 22%—and up to 45% for select items—is a direct response to the changing market dynamicsSimilarly, Three Squirrels has rolled out its "high-end value for money" strategy.

Transformational efforts are further seen within traditional brands, as evidenced by Laiyifen's establishment of a warehouse-style membership store in Songjiang District, Shanghai, aimed at broadening category availability to include beverages, dry goods, fresh produce, and dairy products.

Bimbo's Manketon Crispy Bread Cubes, featuring no trans fats and a non-fried preparation process that is rich in dietary fiber, aligns well with the growing health-oriented snack trend