The boom in plant-based foods – What opportunities still exist?
I started working here at Green Seed Germany 18 years ago. Ever since then, plant-based has been a focus category for our office, even if this food category did virtually not exist as such back then.
Today, the German market for plant-based food products is worth over €2bn. A large amount of food start-ups – 1,987 to be precise – are in business in this segment. Meat alternatives (approx. € 1bn) and plant-based milk (approx. € 800m) are the most important and competitive sub-segments, but increasingly saturated. Many brands have come and gone.
Nevertheless, international companies are still interested in entering the plant-based market – we are contacted for help on a regular basis. Apart from “how long does it take to get on shelf?”, most questions are centred around these topics:
1. Which are the current trends and drivers we can make use of?
2. Yes, we are late to the party, but is there still room to grow?
3. We know Germany is difficult, but how can we enter and develop this market successfully?
A detailed answer to these questions would obviously go beyond the scope of this article, but let me at least share a few insights:
Current trends and drivers
The continuous growth of plant-based products in Germany can be attributed to several key factors:
- Health Consciousness: An increasing number of consumers are adopting plant-based diets due to the associated health benefits. This trend has started well before the pandemic.
- Environment: Germans have always been very environmentally conscious. Plant-based is seen as a way to reduce greenhouse gas emissions, conserve water and lower land use.
- Animal Welfare: Ethical concerns regarding the treatment of animals in industrial farming have driven a significant portion of the population to turn to plant-based alternatives.
- Innovative Products: The market has seen an influx of those. They cater to diverse taste preferences and dietary requirements, making it easier for consumers to make the switch.
A restriction to the above is price. Overall, Germans are once again focussing stronger on price and are not open to expensive, new innovations.
Room for growth in the plant-based food market
As the plant-based food market is continuously evolving, there are several opportunities for growth and expansion.
Although plant-based food products are becoming more mainstream, they are often priced higher than their animal-based counterparts. German consumers are very price sensitive, i.e. making these products more affordable and accessible is vital to achieve wider acceptance. Many players are focussing their efforts on economies of scale and continued innovation in production processes.
Even in the largest sub-category, meat alternatives, there is still potential for expanding product variety, with improved taste, texture and a cleaner ingredient list. Within dairy, cheese alternatives are still underrepresented as well as plant-based spreads or desserts – getting the flavour right will open doors. In virtually every food category you can find a few blank spots to fill a gap, if you analyse the segment and examine the existing product ranges closely. However, wait a bit until you launch frozen meat alternatives. Recent listings and tests from Quorn and Like (Livekindly) have not been encouraging. It will be interesting to monitor the impact that new technologies and processes such as cell-cultured, 3D print and fermentation will have on the plant-based market.
Practical advice
We are all in agreement that Germany is a difficult market, but many companies have managed to succeed. Here some hands-on advice how to overcome a few barriers based on observation as well as experience:
Carefully analyse your competition
You might not be able to play on the same USPs like in your domestic or other export markets.
Send only final versions of plant-based food samples
If you are currently improving taste and texture, finish developing this 2.0 version. Only then send samples to buyers. Otherwise, you will risk that they reject your product based on taste and texture performance. It is difficult to get a second chance in the short-term.
Financial muscle for the German market
Ensure you have a solid financial strategy to be able to maintain the momentum once you achieve listings. You need a budget to support your products on shelf and to keep your listings, in particular with the Edeka and Rewe independents, which require a field sales force. If you are a brand, you need enough financial scope for substantial brand building.
Timing is everything
As in any other category, buyers and consumers alike need to be open for new concepts. Mycoprotein-based products have been around for decades in the UK. In Germany, this ingredient is becoming increasingly important as a sustainable source of protein, particularly in the area of meat alternatives.
This advice is obviously valid beyond the plant-based food category.
If you have any questions or want to obtain more insights, please get in touch with me:
Nicole Guenther
Managing Director, Green Seed Germany
Source market data: Lebensmittel Zeitung January 17, 2025