Production of bread Production of bread | © Eric Gevaert -

Food & Beverage Industry

Supplying the Full Spectrum of Consumer Needs

Few industries are as broad as the food & beverage industry, but Germany does well on all fronts: confectionery, convenience, frozen, and chilled foods.

Our market - Europe's largest - brings almost every international food player here; everyone wants a taste. This strength is only expected to improve as consumption trends and the good reputation of our products promise higher future sales. For investors, the time is ripe. A mainly fragmented industry allows overseas investors access to the market, its distribution channels, and its technological capabilities.

Food and Beverage Sector Investment News

Germany's food and beverages sector has been an unlikely benefactor of the coronavirus crisis - with the organic food and online food retail markets enjoying record turnover.

January 20, 2021

Demand for organic food grows during Covid-19 crisis

Demand for organic foods is growing in Germany according to market research company Nielsen. The company has observed a long-term increase in demand for organic produce, with the Covid-19 crisis creating even greater demand. Around 17 percent more organic products were bought at the end of 2020 as were for the same period in 2019. The Alnatura organic chain recorded turnover of more than EUR 1 billion for the first time during the business year 2019/2020. Corona lockdown restrictions, stockpiling and increased disposable income for foodstuffs are cited as significant factors in the upturn in demand.

Online food retail sales ring in the changes

Historical hesitancy among German consumers to purchase foodstuffs online has fallen as a result of the ongoing coronavirus pandemic. The food retailing sector has recorded the highest growth rates of all e-commerce sectors, with turnover up more than 50 percent on previous year’s levels according to the bevh industry association. Domestic shopping behavior has been transformed by fear of infection and the rise of home working.

Online supermarket chain Knuspr to challenge domestic giants

A new supermarket chain that promises delivery within three hours is set to compete with domestic giants Rewe and Edeka, targeting turnover of several billion euros in the German market. According to the behv industry association, online business is booming, with online grocery sales hitting a sales record – 90 percent growth compared to the same period in the previous year – in the second half of 2020. Launched by Czech supplier Rohlik, Knuspr will roll out activities in Q2/2021 in Munich, followed by Cologne, Hamburg, Frankfurt, Stuttgart and other cities.

Finnish food delivery service WOLT expands German business operations

Finnish food delivery service WOLT has moved into the German market, beginning operations in Berlin in August of last year. The company, already active in 23 countries and more than 120 cities in Asia and Europe, has since expanded its food delivery operations to Frankfurt and Munich.

Bon Culina enters German catering market

Food service provider Bon Culina has launched its ready meal services in Germany. The international menu supplier, already active in five countries, is targeting hospitals, nursing homes and retirement homes as its most important target markets. Other potential client markets include companies in the public and private sectors as well as educational establishments including schools and universities.

Scottish whisky giant establishes own sales company

William Grant & Sons, owner of the Balvenie and Glenfiddich whisky brands among others, started its own sales company in Germany on January 1. The development marks an end to the relationship with Campari Deutschland, previously responsible for William Grant & Sons distribution in Germany. According to the company, the new national subsidiary is part of its ongoing strategy to be closer to customers in key markets.

Latest Publication

The Food & Beverage Industry in Germany The Food & Beverage Industry in Germany | © GTAI

The Food & Beverage Industry in Germany

The German food and beverage market offers business opportunities on all fronts, because it's highly receptive to new cultural influences and culinary trends.

Our Industry in Numbers

  • Germany is Europe's largest food producer and the food & beverage industry represents the fourth largest industry sector in Germany.
  • The industry is best characterized by its small and medium-sized enterprise (SME) sector of over 6,000 companies, generating a production value of around EUR 180 billion in 2018.
  • Exports of processed foods and agricultural commodities generated sales of EUR 71.5 billion in 2018, making Germany the third largest exporter of food and beverages worldwide.
  • Largest sector sub-segments in 2018: Meat (23.7%), Dairy (15.1%), Baked Goods (9.7%), and Confectionery & Long-Life Bakery Products (7.6%).
  • Germany is home to major national and international players including the Dr. Oetker Group, Südzucker, Arla, Mondelēz Deutschland, Nestlé, Cargill, and many more.

Testimonials to Success

Mehmet Er, Managing Director | Tadim Deutschland GmbH

Mehmet Er, Managing Director Tadim Deutschland GmbH Mehmet Er, Managing Director Tadim Deutschland GmbH | © Tadim Deutschland GmbH/GTAI

"Tadim has made a significant move by investing in Germany. We are confident that it will prove to be a value-adding one because of Germany's attractiveness as a production location and the optimal logistics for serving international markets. To this end, we particularly liked Emsdetten because of its central location. We hope to expand our market position in Europe as well as just in Germany and we are already processing and distributing to neighbouring countries." (2016) More Information

Gerhard Berssenbrügge, Former Chief Executive Officer* | Nestlé Germany AG

Gerhard Berssenbrügge, Chief Executive Officer, Nestlé Germany AG Gerhard Berssenbrügge, Chief Executive Officer, Nestlé Germany AG | © Nestlé Germany AG/GTAI

“We deliberately chose Germany and Schwerin for the construction of our third coffee capsule factory. The decisive factors were the favorable geographical location, the close proximity to the world's largest coffee-trading center Hamburg, the ease of access to northern Europe as well as the high density of skilled workers in the region.” (*2014)

Market | Industrial Infrastructure

With around 83 million inhabitants, Germany represents a very receptive market for national and international food & beverage products. Its excellent geographical position (with access to all European markets) and its technological leadership make Germany the best point of entrance to the European food & beverage market. Demand for functional foods alone has established Germany as a European leader, with the organic food segment experiencing a growth of 5.5 percent in sales reaching almost EUR 11 billion in 2018. Thanks to the unbeatable popularity of German products abroad, the industry is expected to maintain its steep growth curve in the years ahead.

Fragmentation in the existing food & beverage industry landscape means that barriers to entry in the German market are negligible. In addition, the presence of numerous companies along the entire food-processing value chain makes it easy for newcomers to find suppliers, distributors, and other valuable partners.

Germany offers a particularly positive market environment for producers of food ingredients and additives of almost all kinds. The size of the industry paralleled by evolving consumer needs and growing exports lead to a vibrant demand for new ingredients and formulations incl. e.g. flavors, sweeteners, stabilizers, emulsifier or fragrances. As most products are used across various sub-segments of the industry, the market and investment potential is tremendous and even likely to increase in the future.

Production Value of the German Food & Beverage Industry by Segment 2018 (in percent) | Federation of German Food and Drink Industries, 2017_2018
Production Value of the German Food & Beverage Industry by Segment 2018 (in percent) | Federation of German Food and Drink Industries, 2017_2018 | © Production Value of the German Food & Beverage Industry by Segment 2018 (in percent) | Federation of German Food and Drink Industries, 2017_2018

Market | Trends

Recent consumer trends have, above all, been influenced by a number of far-reaching changes in society. An aging population is fueling the demand for health & wellness as well as functional food products to prevent or overcome conditions including diabetes, high blood pressure, and cholesterol. Two-thirds of all Germans see a direct link between nutrition and health.

The movement towards organic food products has long since achieved mainstream status in Germany. More and more consumers are seeking to improve their sense of well-being, health, and even their performance levels through the consumption of functional food products. An increasingly fast-paced society and the rising number of single households is driving demand for highly convenient foods including ready-to-eat meals, frozen foods, desserts, and baked goods.

Other trends include the sales of fair trade products, such as coffee and fruit juices, which tripled to more than 1.6 billion euro between 2012 to 2018. Ethnic foods, beauty foods, and “free of” foods (e.g. lactose and gluten-free products) are further trends currently finding favor with Germany’s increasingly discerning consumer base.

Development of Food Retail Sales in Germany by Segment (2017/2018, change in percent) | GfK/Statista, 2019
Development of Food Retail Sales in Germany by Segment (2017/2018, change in percent) | GfK/Statista, 2019 | © Development of Food Retail Sales in Germany by Segment (2017/2018, change in percent) | GfK/Statista, 2019

Personnel | R&D

Germany has a large pool of highly qualified and motivated employees and offers competitive labor costs compared to both western and eastern Europe.

R&D and innovation spending in the German food & beverage industry is expected to reach EUR 3 billion in 2019. Product innovations account for 15 percent of total annual sales of the German food & beverages market. Numerous well-known universities and public and private research institutes help companies in the food & beverage industry research, develop, and swiftly bring new and innovative products to market.

Marc Rohr Marc Rohr | © GTAI/Illing & Vossbeck Fotografie

"Germany is Europe’s largest food & beverage market and a superb location for exports."

Marc Rohr | Director Service Industries

Incentives | Physical Infrastructure | Stable Investment Environment

Germany offers numerous incentives for all investors - regardless of country of origin. There are a large selection of programs available designed to support a wide variety of business activities at different stages of the investment process. Support ranges from cash incentives for the reimbursement of direct investment costs to incentives for labor and R&D.
We offer an extensive and comprehensive logistics infrastructure that integrates state-of-the-art transportation networks with the most modern telematics, IT, and telecommunications systems.

Social, economic, and political stability provide a solid base for your investment projects. Our judiciary and civil services are highly professional. Contractual agreements are secure and intellectual property is strictly protected in Germany.

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