Beer market of Russia 2016: PET goes to draftThe beer market of Russia was warmed up by the hot summer, but the preparation for large volume PET prohibition has already impacted it negatively. The year was successful for Efes, MBC and regional producers; Carlsberg’s positions were virtually stable but AB InBev and Heineken lost a part of market share having focused on the sales profitability. The dynamics of big brands was determined by how much the companies were willing to keep the prices down or by their promotional activity. In this context the economy segment of the beer market and sales of inexpensive draft beer were increasing. The premium segment started shrinking due to license brands migrating to the mainstream segment.
Beer market of Vietnam: “Young tiger”Vietnam is one of the few big beer markets that continue to grow steadily. The beer popularity results from its low price, street consumption culture, and social motives. The outlooks of beer market as well as the Vietnamese economy inspire optimism, though the country is heavily dependent on export of goods. The state regulation can be called liberal, but the key risk for brewers is harbored in intensive rising of excise. Within TOP-4 there are two leaders, Sabeco and Heineken that grow at the fastest rates. The first company effectively employs its capacities, the second one focuses on marketing technologies. Almost 80% of the market belongs to century-old brands, yet the middle class and the youth are shifting their interest toward international premium that is growing taking share from the mainstream.
Analysis of beer market in China (on Russian)
Beer market of Ukraine: big three losing weightIn 2016, fast increase of excises and resulting price spike stood in the way of the beer market stabilization. Most of competition (as well as mass sorts) moved to the economy segment of the market. The biggest losses were incurred by the leading three, especially Obolon, which again experienced pressure after reallocation of Efes market share. However, one should already speak of TOP-4. Group Oasis CIS (PPB) became a strong player and competitor to transnational companies. Besides the net sales of many regional medium breweries look rather good and 16-fold cost reduction wholesale trade license for craft brewers opens up a possibility of rapid growth in 2017.
Vietnam. Beer market is not as attractive as wine and soft drinks sector’s
- Policy of innovation,
- Joining in many FTAs in the world,
- Fast developing economy, improved demand and people's condition of living;
- Growing international tourism and FDI.
Thus, currently, a large number of factories were built with equipment and modern technology, making a variety of products with high quality, high margin and able to contribute largely to the state budget. Vietnam beverage market has gradually met the demand of domestic market, replaced partly import and increased export. Beer and beverage sector still take up major share while alcohol hold the small proportion in the whole industry.
Beer production in Vietnam depends on imported raw materials. With large-scale production and stable growth, domestic beer sector has met the domestic growing demand, especially in the high-end products such as bottled beer and canned beer. This helps reduce the imports and increase exports, contributing to the improvement of export turnover of the sector.
Habeco and Sabeco are exclusively dominant for the low-income segment while Heneiken and some other FDI enterprises, such as Carlsberg and Sapporo, compete in the middle-income segment. There are many brewery projects built by domestic and foreign firms, resulting in the excess of in the next 5-10 years.
With the advantage of natual resources like abundant mineral water, various fruits, Soft drink market has large-scale, high rate of the growth and gradually met the domestic demand. In the sector, RTD tea, Bottled water and Carbonated Drinks take the largest proportion of consumption. For most of the Soft Drinks, off-trade distribution is more efficient than on-trade. Because of several products and a large number of companies, competition is becoming more intense. The strong development of FDI hurts domestic bussiness, Export of Soft Drinks increases rapidly. Asia such as Thailand and Hong Kong is the fastest growing market for exporting Juice and importing Carbonated Drinks.
Alcohol market size is small with a decrease in production and consumption. Domestic products gain the low export turnover and can not meet domestic demands for high-end one, resulting in a rise in alcohol import.
Domestic Wine market is full of potentials for development as it primarily serves clients in the middle-class and above and is increasingly favored by Asian markets. However, customers in the elite mainly use wine imported from countries with tradition of wine-making, such as France, Chile, Spain and etc.. Domestic Spirits market is underdeveloped, dominated by premium Spirits from Europe and the Americas.
Among top enterprises in the industry, there are only a few domestic enterprises with large-scale and strong brands to compete with FDI firms. The remaining is small businesses with weak competitiveness, lack of capital for expansion, as well as building a distribution system and developing brand. However, enterprises are generally maintained stable trade with revenue up slightly thanks to the increase in sales costs including marketing cost, promotion cost and agent commissions. Hence, profits of enterprises are all increase and inventory turnovers are rather fast, especially in Beer and Soft drink sectors. Besides, Beverage sectors have relatively high self-financing rate, good liquidity and high asset utilization. Businesses have been focusing on investing to expand production and applying modern machinery. However, inventories are still very high in Alcohol. Though Beer market is growing, its profitability and investment opportunities are not as attractive as Wine and Soft drinks sector's.
15 Apr. 2016