Flavors & Fragrances Market: Current Analysis and Forecast (2021-2027)

Report Description

Global Flavors & Fragrances Market was valued around USD 26 billion in 2020 and is anticipated to grow at a CAGR of ~5% over the forecast period (2021-2027). Rising incomes and urbanization is spurring interest in convenient packed foods and fast foods. This would boost growth of food and beverage industry, as packaged goods require high flavoring loadings to preserve taste which is lost during large-scale manufacturing of food and beverages. Owing to this, the food and beverage industry will continue to remain the key driver of flavor and fragrance market. The flourishing food industry and increasing demand for processed foods would showcase considerable growth rate. For instance, the US foodservice and food retailing industries supplied about USD 1.79 trillion worth of food in 2019. This growth would further drive the widespread use of flavors and fragrance in processed food, snacks, soft drinks, candy and confectioneries, meat and seafood products, and sauces, etc.

Some of the major players operating in the market include Givaudan S.A., Mane S.A., Firmenich S.A., Symrise AG, International Flavors & Fragrances, Inc., Takasago International Corporation, The Archer Daniels Midland Company, DuPont de Nemours Inc., Bell Flavors & Fragrances, T. Hasegawa Co. Ltd. Several M&A’s along with partnerships have been undertaken by these players to boost their presence in different regions.

Insights Presented in the Report

“Amongst ingredient, synthetic ingredient held lucrative market share.”

Based on ingredient, the flavors & fragrances market is segmented into natural and synthetic ingredients. Synthetic flavors and fragrances hold prominent market share owing to its low cost and growing use in various end use industries, such as beverages, packed food products, and home & personal care products. For instance, according to study carried out in 2019 by The International Fragrance Association, synthetic ingredients held market share of 59% of fragrance industry supply chain spend. However, a growing segment of the public prefers natural foods over foods containing artificial additives and are ready to pay premium price for natural foods; therefore, with rising demand for natural foods, natural ingredients flavors and fragrances market is likely to showcase robust growth during the forecast period.

“Amongst application, flavor category held prominent market share in 2020.”

Based on application, flavor category held lucrative market share which includes bakery, beverages, dairy products, and confectionery industries. Significant share of flavor category is due to high demand of bakery products and beverages. For instance, according to Mrs. Bectors Food Specialties Limited DHRP, global biscuit market is anticipated to grow at a CAGR of 6% by 2025. Besides growth in bakery product and beverages, increasing demand of dietary drinks owing to the rising percentage of health-conscious individuals is further propelling the market of flavors.

“Europe represents prominent market share in the Global Flavors & Fragrances Market.”

For a better understanding of the market adoption of flavors & fragrances, the market is analyzed based on its worldwide presence in the countries such as North America (United States, Canada, Rest of North America), Europe (Germany, France, Spain, United Kingdom, Italy, and Rest of Europe), Asia-Pacific (China, Japan, India, Australia, and Rest of APAC), and Rest of World. Europe held the significant share in the global flavors & fragrances market. The region is known for its rich history and passion for fine fragrances & specializes in integrating perfumery with tradition, research, and creativity. People in the European countries are very selective in choosing scents and are spending a considerable amount of their incomes on fragrances leading to the growth in sales of fragrances in the region. For instance, sales of Symrise AG, which is a major producer of flavors and fragrances in Europe increased by 3.3% in 2020 despite of pandemic.

Furthermore, the presence of well-established players such as Symrise AG, Robertet Group, and Mane S.A. among others in the region is further propelling the growth of the European flavors and fragrances market.

Reasons to buy this report:

• The study includes market sizing and forecasting analysis validated by authenticated key industry experts
• The report presents a quick review of overall industry performance at one glance
• The report covers an in-depth analysis of prominent industry peers with a primary focus on key business financials, product portfolio, expansion strategies, and recent developments
• Detailed examination of drivers, restraints, key trends, and opportunities prevailing in the industry
• The study comprehensively covers the market across different segments
• Deep dive regional & country-level analysis of the industry

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Research Methodology

Analyzing the historical market, estimation of the current market, and forecasting the future of global flavors & fragrances were the three major steps undertaken to create and analyze the adoption of flavors & fragrances across various segments in North America, Europe, Asia Pacific, & Rest of the world. Exhaustive secondary research was conducted to collect the historical market numbers and estimate the current market size. Secondly, to validate these insights, numerous findings and assumptions were taken into consideration. Moreover, exhaustive primary interviews were also conducted, with industry experts across the value chain of the flavors & fragrances. Post assumption and validation of market numbers through primary interviews, we employed a bottom-up approach to forecast the complete market size. Thereafter, market breakdown and data triangulation methods were adopted to estimate and analyze the market size of segments and sub-segments the industry pertains to. Detailed methodology is explained below:

Analysis of Historical Market Size

Step 1: In-Depth Study of Secondary Sources:

Detailed secondary study was conducted to obtain the historical market size of the flavors & fragrances through company internal sources such as annual reports & financial statements, performance presentations, press releases, etc., and external sources including journals, news & articles, government publications, competitor publications, sector reports, third-party database, and other credible publications.

Step 2: Market Segmentation:

After obtaining the historical market size of the flavors & fragrances market, we conducted a detailed secondary analysis to gather historical market insights and share for different segments & sub-segments for major regions. Major segments included in the report are as ingredient and application. Further regional & country-level analyses were conducted to evaluate the overall adoption of flavors & fragrances in the global context.

Step 3: Factor Analysis:

After acquiring the historical market size of different segments and sub-segments, we conducted a detailed factor analysis to estimate the current market size of flavors & fragrances. Further, we conducted factor analysis using dependent and independent variables like upsurge in disposable income and improvement in living standard. Historical trends and their year-on-year impact on the market size and share in the recent past were analyzed. Demand and supply side scenario was also thoroughly studied. 

Current Market Size Estimate & Forecast

Current Market Sizing: Based on actionable insights from the above 3 steps, we arrived at the current market size, key players in the global flavors & fragrances market, and market shares of the segments. All the required percentage split, and market breakdowns were determined using the above-mentioned secondary approach and were verified through primary interviews.

Estimation & Forecasting: For market estimation and forecast, weights were assigned to different factors including drivers & trends, restraints, and opportunities available for the stakeholders. After analyzing these factors, relevant forecasting techniques i.e., bottom-up approach was applied to arrive at the market forecast to 2027 for different segments and subsegments across the major regions globally. The research methodology adopted to estimate the market size encompasses:

• The industry’s market size, in terms of value (USD) and the adoption rate of flavors & fragrances across the major markets
• All percentage shares, splits, and breakdowns of market segments and sub-segments
• Key players in the flavors & fragrances market in terms of services offered. Also, the growth strategies adopted by these players to compete in the fast-growing market.

Market Size and Share Validation

Primary Research: In-depth interviews were conducted with the Key Opinion Leaders (KOLs) including Top Level Executives (CXO/VPs, Sales Head, Marketing Head, Operational Head, and Regional Head, Country Head, etc.) across major countries. Primary research findings were then summarized, and statistical analysis was performed to prove the stated hypothesis. Inputs from primary research were consolidated with secondary findings, hence turning information into actionable insights.

Split of Primary Participants in Different Regions

Market Engineering

Data triangulation technique was employed to complete the overall market estimation and to arrive at precise statistical numbers of each segment and sub-segment of the global flavors & fragrances market. Data was split into several segments & sub-segments post studying various parameters and trends in the ingredient and application.

The main objective of the Flavors & Fragrances Market Study

The current & future market trends of flavors & fragrances were pinpointed in the study. Investors can gain strategic insights to base their discretion for investments from the qualitative and quantitative analysis performed in the study. Current and future market trends determine the overall attractiveness of the market at a global & country level, providing a platform for the industrial participant to exploit the untapped market to benefit as a first-mover advantage. Other quantitative goals of the studies include:

• Analyze the current and forecast market size of flavors & fragrances in terms of value (USD). Also, analyze the current and forecast market size of different segments and sub-segments
• Segments in the study include areas of ingredient and application.
• Defined analysis of the regulatory framework for the global flavors & fragrances industry
• Analyze the value chain involved with the presence of various intermediaries, along with analyzing customer and competitor behaviors of the industry
• Analyze the current and forecast market size of the flavors & fragrances for the major regions & countries
• Major regions studied in the report include North America, Europe, Asia Pacific, and Rest of World
• Company profiles of the flavors & fragrances market players and the growth strategies adopted by them to sustain in the fast-growing market
• Deep dive regional & country level analysis of the industry