I was cleaning out my study and found a copy of a report I worked on while doing my MBA: the dry pancake mix market. I had a lot of fun doing the market research, scanning through IRI data, and the user surveying. It’s be a shame not to share with you, what I learned about the industry:
- The industry can be traced back to 1889 in St. Joseph, MO, when Chris Rutt and Charles Underwood bought the Pearl Milling Company with the idea of developing ready-mixed, self-rising pancake flour. While attending a vaudeville show, they heard the catchy tune “Aunt Jemima,” and decided that would be the image of their product. They ran out of capital and sold it to Davis Milling Company the following year. Davis Milling sold to Quaker Oats in 1925. (Quaker is now owned by Pepsi.)
- Other notable companies:
Company* Headquarters Date Brand Little Crow Foods Warsaw, IN 1919 Fast Shake General Mills Minneapolis, MN 1931 Bisquick Continental Mills Tukwila 1932 Krusteaz Pilsbury Minneapolis, MN 1935 Hungry Jack General Mills Minneapolis, MN 1947 Betty Crocker Aurora Foods St. Louis, MO 1961 Mrs. Butterworth’s
This gets really tricky to track because of all the multiple brands, company consolidating and divestiture going on. Examples:
- Pillsbury was acquired by Grand Met in 1988. Grand Met then merged with Guinness to form Diageo. Diageo had trying to spin out its non-beverage units and, in November 2001, received approval for General Mills to acquire Pillsbury.
- Follow that? Well, then I should tell you that Aurora Foods, whose business model was acquiring orphaned brands, acquired the Mrs. Butterworth’s brand from Unilever in 1996. (They also owned Log Cabin syrup, Duncan Hines bread mixes, and Lender’s Bagels.) As part of Aurora Foods’ subsequent bankruptcy reorganization, they agreed to merge with Pinnacle Foods in NJ.
- Still with me? Did I mention that Aurora Foods produces the frozen Aunt Jemima breakfast products?
- To avoid getting sucked down the brand tracking rathole, I stuck to dry pancake mix. Not cakes. Not frozen. Not moist. (La la la la.) Companies own multiple brands. For example, General Mills owns heavyweights Betty Crocker, Hungry Jack and Bisquick. That, I could track.
- The total retail breakfast food market, whihc includes frozen foods, breakfast bars, cereals and pancakes, is about $11 billion. The dry pancake mix market accounts for about $160 million of this. For comparison, the annual sales of plain Cheerios is $160 million.
- There are over 150 manufacturers of dry pancake mix. Four of them, Pepsi, General Mills, Continental Mills, and Aurora Foods, do 90% of the sales. Pepsi’s Aunt Jemima comprises the largest chunk of the market (35%), though it accounts for less than 0.25% of Pepsi’s annual revenue.
- Most of the “lower 130” are small, boutique brands that are very localized and capitalize on the experience of visiting a place, often a B&B or resort. Think fancy packaging, premium price. In a couple of cases where they’ve exceeded $1m of revenue, they’ll get sucked up by one of the big three.
- Pancake mix sells better than average in families and where annual income is at least $40k. Not surprisingly, it does not fare very strongly among SINKs and DINKs
- Bisquick is generally the cheapest of the “big” brands. Aunt Jemima and Krusteaz are the most expensive.
- Buttermilk is the most popular flavor. Chicken Gummy Bear Mint is the least popular flavor. (Okay, I made that last one up, but it’s very disgusting.)
I prefer the sourdough hotcakes, and when I don’t have the time, I’ll make this recipe:
Pancakes — www.wt8p.com
1 C whole wheat flour
2 t baking powder
1/r t salt
1 T sugar
1 C milk
1 T vegetable oil
- Mix the dry ingredients separately.
- Mix the moist ingredients separately.
- Combine them, stirring with a fork until the major lumps are out.
- Pour dollops onto a medium-hot, buttered pan. Cook until bubbles start percolating toward the top, then flip. Cook a few more minutes then serve.
I do occasionally buy mix when my kids want to help out and I don’t want them destroying my kitchen.