Instant Noodles Industry

in Nigeria

and and

Related Issues

Invented in 1958 by Momofuku Ando Founder Nissin foods (Brand - Ramen)

Worldwide over 100 billion packs of instant noodles were consumed in 2012

Demand from china comprises 44% of the worldwide demand

Nigeria ranks number 12 at 2% of world demand ahead of Malaysia, Taiwan and

Mexico

Instant Noodles

Global Demand for Instant Noodles

42,53040,860

42,300 42,47044,030

30,000

35,000

40,000

45,000

50,000

Global Demand for Instant Noodles

1,400

1,2101,110

860

510

1,600

1,070

860

590

1,670

1,220

1,020

830730

1,790

850 820

1,900

1,300

1,010890 890

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

Nigeria Malaysia Taiwan Mexico Nepal

Global Demand for Instant Noodles

2008 2009 2010 2011 2012

Unit: 1 Million Packets (Bags/Cups)

Estimated by World Instant Noodles Association (WINA)

13,700

5,100

13,930

5,340

14,400

5,290

14,530

5,510

14,100

5,410

0

5,000

10,000

15,000

20,000

25,000

30,000

China / Hong Kong Indonesia Japan

1 2 3

2008 2009 2010 2011 2012

Unit: 1 Million Packets (Bags/Cups)

Estimated by World Instant Noodles Association (WINA)

Nigeria Instant Noodles Market

Very high category penetration of 60%

Market size 250,000 tonnes (2012)

Translates to more than USD 600mn

Dominated by Indomie more than 70% share

Lower penetration in North More traditional way of living

Source: Nielsen

Lower penetration in North More traditional way of living

Total investment by all players (Naira 68bn or USD $ 425 mn)

Over 20,000 people employed

Instant Noodles-Related Industries

Noodles

Carton Flour Palm OilFlexible

packagingSalt Sugar Chilli

History Noodles in Nigeria

Second entrant Chikki 2005

Flour millers enter the category

Started with Indomie in Nigeria, First factory in Ota Setup in 1996

Started with regular chicken flavour

Gap Minimal presence of snack food in Nigeria

Focus

Availability Affordability Acceptability

How we got here

How we got here

Acceptability

Affordability:

CPI has increased by

more than 3 times last

decade

Instant noodle price only

doubled

Acceptability

Major Concern

Sampling: to introduce cooked product

Marketing Activities

Availability

Strong distribution

network

Noodles available in 60%

retail outlets

Avail-

ability

Afford-

ability

Accept-

ability

Scope for Growth

Lots of innovation in the instant noodles market worldwide

Indomie tried with box noodles, but was unsuccessful

Currently Indomies Hungry Man Size; Biggest noodle block

to be sold commercially

Cup Noodles Vending Machine

Gives Noodles Push-Button Simplicity

Innovative Flavours Unique Varieties

BOX Noodle Indomie Hungry man Size Noodle

WEAKNESSESSTRENGTHS

SWOT analysis

Affordability

Loyal consumers

High Category Penetration

Fast cooking & Convenience

Raw material

Price fluctuation extreme; Supply unpredictable

High manufacturing cost compared to other countries

SWOT

THREATSOPPORTUNITIES

Scope for growth in terms of product line

Heavy duty on wheat Importation hurting growth prospects

Lift of ban on importation

SWOT

Conclusion

Government support Ban on importation

Scope for growth in terms of variations offered

Industry can compete at the world level

State of the art factoriesState of the art factories

Innovation (210gms and Box Noodles)

Baba Indomie

Mr Haresh Aswani (MFR)

MD, Nigeria

Tolaram Group

Thank YouThank You