Published by Canadean, this Quarterly Beverage Tracker report provides a detailed analysis of the latest developments in the China beverage market
Introduction and Landscape
Why was the report written?
In the current climate of economic uncertainty and market volatility companies need to know about more than just data. This report provides a complete overview of all commercial beverage consumption trends, latest market developments and an economic mood indicator
What is the current market landscape and what is changing?
China's economic restructuring slowed down its speed of GDP growth in Q4-13, but the proportion between industries has been optimized. The service industry has experienced significant growth during the fourth quarter.
What are the key drivers behind recent market changes?
The national average temperature rose 0.8 degrees in October, 0.7 degrees in November, and 0.3 degrees in December.
What makes this report unique and essential to read?
Designed for clients who want to understand the latest trends in the China beverage industry and want more detail and analysis on this data. Canadean's China Quarterly Beverage Tracker report is ideal for benchmarking total market vs retail audit data and is an essential tool for keeping up-to-date with the latest industry and market developments
Key Features and Benefits
Readers are provided with a summary snap shot table showing category growth in Q42013vs Q42012, together with provisional 2013 volumes and latest2014 forecasts
An economic mood indicator, completed by Canadean's local consultant, examines (on a scale of one to five) whether confidence levels in the industry are better or worse than the previous quarter, whether net prices are rising or falling and how Private Label products have performed versus the rest of the market. Selected retail pricing data is given for the most recent quarter and the previous four quarters, enabling analysis of price movements.
Key highlights of the last quarter's commercial beverage performance are identified and the key market drivers examined
Volumes for Q42013 vs Q42012, provisional2013 volumes, moving annual totals (MAT) and latest 2014 forecasts are provided for each individual beverage category, together with supporting text on quarterly performance and forecast assumptions. More granular data is provided for the Carbonates category, with data split by regular vs low calorie, and by key flavors. Significant activity in the soft drinks industry is covered including recent new product introductions (detailing flavor, pack type, pack size, retail price and selected pack shots) and the latest Industry News.
Key Market Issues
PL continues to hold a low consumer acceptance. Quality concerns are the main reason behind its infancy. Most superior suppliers are only willing to contract with brands that control a larger market share and better reputation.
Q4 is generally a weak season for beer consumption and only 1.9% growth was witnessed. This was largely because it is a relatively maturing market, given the continuous fast development in previous years. Competition is much fiercer and thus the industry has become more consolidated.
Hot tea in Q4-13 dropped down to a growth rate of 4.2%, mainly because of its unchanged strategy which does not meet market needs of diversification.
China's retail sales grew 13% year on year to RMB21.13 tn (US$3.48 tn) in the first 11 months of 2013. Improving economic growth and the country's determination to shift to a domestic demand-driven expansion model has boosted consumer confidence. For individual months, China's retail sales grew 13.3% to RMB2.15 tn (US$352.6 bn) in October, and 13.7% to RMB2.1 tn (US$344.4 bn) in November.
In spite of raw milk undersupply, dairy drinks experienced growth of 8.7% in the last quarter of 2013, as leading dairy manufacturers took measures to strengthen their control of raw milk sources. Increasing cost pressures became one of the reasons for the increase in retail prices by dairy beverage makers, including Mengniu, Yi and Bright Dairy. This impaired sales to some extent, although the rigid and increasing consumer needs partially offset the effects.
Soft drinks categories have continued with healthy double-digit growth, primarily owing to the key categories such as iced/rtd tea drinks and packaged water. With such promising results, the soft drinks industry is expected to capture the opportunities from the rebound in China's economy during the coming quarters.