Mooncake Market, 2021: Turnover Set to Shrink 5.7% as Consumer Purchasing Power Remains Weak (Current Issue No.3267)

         The Mid-Autumn Festival, which falls on September 21, 2021, presents another challenging year for the mooncake business due to the protracted COVID-19 pandemic, which is much worse than the previous year. As a result, consumer purchasing power remains weak, and this may affect the decision to purchase mooncakes this year. Traditionally, mooncakes are eaten during the Mid-Autumn Festival, but its consumption tends to be restricted by the fact that they are relatively expensive. Therefore, spending on mooncakes may not recover during the upcoming Mid-Autumn Festival.

            KResearch assesses that 2021 turnover in the mooncake business may shrink 5.7 percent to approximately THB755 million, against the contraction of 15.8 percent reported for 2020, due mainly to the decline in sales volume. Mooncake makers that target the mass market segment will likely be hurt by eroding consumer purchasing power amid the ongoing COVID-19 pandemic; those targeting the premium consumer segment may be able to stay afloat although they will continue to experience challenges from increased competition from rising number of players.   

         ​KResearch is of the view that effective preparations to cope with unfavorable market conditions, including efficient cost management and appropriate production capacity plans, are imperative in helping sustain mooncake sales. Concurrently, creating new gimmicks and product differentiation will help boost profit and compensate for the rising costs somewhat. Moreover, expanding sales channels or collaboration with business partners in product distribution, and early introduction of marketing campaigns for other festivals may also help increase profit for mooncake bakers.