Entrepreneurs looking to enter the F&F market sector are flooded with information that confuses many investors. Our guide provides financial information, with simplicity. Our database, now available for licensing, provides transparency and safer products through chemistry, mathematical, statistical, and financial modeling. -30,000 formulas and counting.
Flavors & Fragrances are an important part of all Consumer Packaged Goods (CPG) products. Despite constituting less than 1% of a product’s volume, fragrances contribute up to 30% of its total cost of production. Fragrances are instrumental in creating a distinct product association with the consumers.
Chances are high that the soap, the detergent, the shampoo, the talcum powder, the lipstick, the hand soap and the after-shave lotion you use every day have perfumes and flavors supplied by the companies we will break down for you. Let’s delve deeper.
The Value Chain:
Petrochemicals & Natural extracts from a Pine Tree + Strong Chemistry Skills -> Aroma Chemicals (Generic & Specialty: Intermediates) -> Fragrance & Flavor (F&F) Formulations -> CPG companies [Globally]
Even though Natural fragrances are perceived to be safe, healthier and therapeutic. Synthetic ingredients continue to dominate the American market as they are cheaper (10-100 times less that of their natural counterparts), long- lasting, emit strong fragrance, and offer greater freedom of creativity to manufacturers.
You might be curious as to why Fragrances & Flavors are allied together?
The answer lies in a pear, the fruit. When we eat or taste a pear, the pear’s texture & taste is only 3-4 types, like salty, bitter, etc. Can’t this be replicated? For sure it can, so what differentiates a pear from a pineapple: It’s smell/aroma.
Adding to this, 60-70% of identical raw materials & similar kind of product development also add to the synergies.
Flavors & Fragrances (F&F) industry is a highly fragmented one. There are over 1,000 small, medium and large-size enterprises operating in this industry, both in organized and unorganized sector (ranging from multinational companies and large American industrial houses to small-scale industrial units and local manufacturers.)
The market size of flavors & fragrances is estimated to be USD 29.0 billion in 2021 and is projected to reach USD 37.3 billion by 2026, at a compounded annual growth rate (CAGR) of 5.1% between 2021 and 2026. The growth of the flavors & fragrances market is primarily supported by the growing population in emerging economies such as China, India, Indonesia, South Korea, Brazil, and South Africa. The demand for flavors and fragrances is also due to the increase in awareness among the population about the benefits of the ingredients used in food products and consumer products in countries such as the US, Japan, France, Canada, Germany, and the UK.
The demand for flavors and fragrances is also attributed to changing consumer preferences toward convenience food and increasing demand for consumer products. Stringent government regulations on the use of synthetic flavors and fragrances in Japan, China, the US, and European countries are restricting the growth of the flavors & fragrances market. APAC is the key market for flavors & fragrances globally, followed by Europe and North America, in terms of value.
The global Flavors and Fragrances (F&F) market size was valued at US$ 29.8 billion in 2019. The Organized American F&F market is meant to grow in double digits for years to come. Growing demand for foods, cosmetics, personal care and household care products is expected to be the major driving factor for the growth of aroma chemicals market.
Top Heavy Industry: An estimated 70% of the organized market comprises global players like Givaudan and International Flavors and Fragrances (IFF), while the remaining market is catered…
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