Archive for October, 2016

Cereal and Granola Manufacturing and the Health Concious Revolution

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Our diverse clientele residing in many different industries allows us to hone our valuation skills in everything from aerospace equipment to herbal vitamin manufacturing. Recently,  our valuation projects in the cereal and granola industry, an arena seeing much transformation with Americans’ increased concerns of dietary transparency.

In recent years, you’ve probably noticed the influx of gluten-free alternatives. While breakfast cereals and bread toast are still commonly consumed in many developed countries, the cereal industry has faced challenges overcoming unhealthy perceptions due to campaigns of the high sugar content found in some brands. In response, cereal manufacturers have moved towards high-fiber alternatives that are growing in popularity. Additionally, gluten-free alternatives have moved into breakfast cereals as well. According to a study in Nutraceuticals World, although in value terms, gluten-free brands account for just 1% of global HW breakfast cereal sales in 2015, they grew by an impressive 79% between 2010 to 2015 – the second fastest growing category fueled by demand in the US, Australia, and the UK. As of 2015, clean-labeled breakfast cereals were worth $3 billion, with “no artificial colors” and “no artificial flavors” delivering $2 billion in sales each.

In lieu of the health conscious trend, convenience has also taken up the spotlight. Snack bars are also filling in the need for eaten-on-the-go, portable options that are extremely popular with Millennials, valued at $11 billion in 2015.

As we continue to conduct research in these diverse and dynamic industries, we’re interested to see how well-known brand names in the industry evolve to consumer lifestyles and health preferences – and ultimately how these trends and preferences affect valuations.

Made in America – Advanced Manufacturing

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While growth in American manufacturing has been slow in the past years since 08’, according to many reports we’ve come across in our research, the US work force has moved towards more advanced manufacturing jobs that emerging economies lack the expertise to perform. Thus, America’s manufacturing days are not long-gone. In fact, domestic manufacturing still has an immense impact on the US economy, according to a recent WSJ article. Each dollar of value added in these areas generates the following amounts of additional transactions.