Low income consumers are the dairy industry’s next hope for growth and 50% of these live in India and China, according to a study by Tetra Pak, the world's leading food processing and packaging company. With rise in prosperity and purchasing power increasing number of low income consumers are expected to value quality rather than just affordability, and switch to packaged dairy products.
It is believed that today’s low income consumers are tomorrow’s middle class and hence there will be a shift from low to middle incomes by the end of the decade, boosting their purchasing power and the range of products they buy. This will create tremendous demand for convenient, ready-to-drink solutions, leading to tremendous growth opportunity for the diary industry.
Consumption by low-income consumers in developing markets is forecast to increase from about 70 billion litres in 2011 to almost 80 billion litres in 2014, according to the Dairy Index, released recently by the Tetra Pak.
The Tetra Pak research focused on six countries which account for more than 76% of liquid dairy products (LDP) consumption India, China, Indonesia, Brazil, Pakistan and Kenya. These are low-income consumers live on $2-$8 a day. They make up about 50% of developing countries population and consume 38% of LDP in developing countries.