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3-2019

Russia: Positions of Brewing Companies

The review contains an analysis of interim performance of brewers in the first half of 2019. There are rather dynamic changes behind a modest industry growth. Baltika is again experiencing a stage of volumes and market share slid due to competition with AB InBev Efes. Because of the price competition and presence expansion in the modern trade company #2. has come close to the leading position. At the same time sales of Heineken Russia have continued growing which makes the premium part of the portfolio heavier. The market premiumization trend had been also confirmed by import brands. MBC and Zavod Trekhsosenskiy have been the most successful among federal market players. The market share of independent regional brewers and Ochakovo have continued falling as they are being squeezed out by the market leaders at their competitive fields.

Ukrainian beer market 2019: companies and brands

In 2019 beer production and market have been still fluctuating about zero point. However, the past season was successful for brewers judging by the sales profitability. The price mix has improved due to rapid general market premiumization, as well as its particular aspect, the growth of import beer sales. By the season end AB InBev Efes improved its positions considerably. It turned out that consumers had not forgot Efes brands that had to leave the market, but started to recover rapidly. Against the stagnating market that meant sales decline of other companies, in the first place Carlsberg Group that most of all beneficiated from Efes exiting the market. PPB turned out to be stable to branding activity of its competitor and Obolon kept the same volumes and at the moment it is the absolute leader of the economy segment. The share growth of independent producers took place thanks to leading craft breweries, that so far do not have a big market weight, but they are rapidly gaining it.

Brewing industry in Kazakhstan 2019

During the first half of 2019, the majority of Kazakh brewers made their contribution into positive dynamics. Yet it was companies of the lower division, not the two transnational leaders that raised their production and sales. The shares of draft beer and aluminum can which is rapidly squeezing glass bottle out of the market, have been growing. The price segmentation has remained stable despite the substantial rise of retail prices and fluctuations of brand market shares, while the borders between segments have become blurred. The main events in the industry have been: the announced revision of the beer excise policy, launch of BeerKhan brand in the strong beer segment, and most important – purchasing assets of Shymkentbeer by Arasan.

Vietnam. Beverage companies seek tax delay

Beverage companies seek to delay until the beginning of 2017 the application of amended regulations on calculating their special consumption tax, claiming they need more time to adjust their production plans.

According to Decree 108/2015/ND-CP and Circular 195/2015/TT-BTC, which came into force just over two months ago, the special consumption tax on producers would be calculated based on the price that its member distributing company sold to sales agents and the taxable price must be lower than 7 per cent compared to the agent's monthly average end selling price.

Nguyen Van Viet, chairman of Viet Nam Beer Alcohol Beverage Association, said that the price gap being capped at 7 per cent would cause administrative procedures to become more complicated for companies.

"Beverage companies need time to adjust their production plans," said Viet, adding that implementation of the two documents should be delayed until January 1, 2017.

Nguyen Hong Linh, general director of Ha Noi Beer Alcohol and Beverage Joint Stock Corp. (Habeco), said that having the price gap between sales agent and distributing company capped at 7 per cent, instead of current 10 per cent, would make it hard for distributing companies to cover their operation costs.

The regulation would also cause difficulties in compliance, as the price of beverage products often change seasonally.

Participants at a conference yesterday urged the Government to revise the regulations on calculating the special consumption tax for companies that operated under a holding company model in order to create conditions for them to operate efficiently.

Several companies said that the taxable price should be the end selling price of the producer, not the end selling price of its member distributing company.

Le Hong Xanh, deputy director of Saigon Beer-Alcohol-Beverage Joint Stock Corp. (Sabeco), said that the new regulations would increase tax pressure on companies and might cause a decline in revenues as well as contributions to the budget.

Dau Anh Tuan, from the Viet Nam Chamber of Commerce and Industry, said that the issuance of legal documents must have an appropriate roadmap, adding that sudden amendments might force companies to face the risk of losses or even leave the market.

The two legal documents were issued months after the audit watchdog proposed that Sabeco pay an additional VND408 billion (US$18.2 million) in special consumption tax for 2013.

Sabeco distributed its beer products through several intermediaries, from a subsidiary, Sabeco Trading Joint Stock Company, in which it holds a stake of 90 per cent, to regional trading companies, before selling to dealers and consumers.

Sabeco's excise tax filing was based on the selling price of Sabeco Trading Joint Stock Company, while the state audit said that the excise tax should be calculated based on the selling price of regional trading companies, resulting in a controversy.

The association earlier this year said that the beverage industry contributed VND30 trillion to the State budget last year.

17 Мар. 2016

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