Global Beverage Survey 2013–2014: Market Trends, Buyer Spend and Procurement Strategies in the Global Beverage Industry

Wednesday 29 May 2013, Amsterdam

Across the global beverage manufacturers’ industry, the top three expected key changes in business structure are the addition of ‘new products and services’, ‘improving operational efficiency’, and to ‘expand in emerging markets’. In the 2012 survey, the top three expected key changes in business structure were ‘expand in current market’, the addition of ‘new products and services’, and ‘improving operational efficiency’.

The majority of global beverage manufacturers, 69%, identify the development of ‘new products and services’ as a key expected change in their business structure in 2013. Product quality and sourcing is a challenge for a large portion of beverage manufacturers, and in order to sustain their position in the competitive market, beverage producers place emphasis on issues such as quality, health, and nutrition, fueled by consumers’ growing interest in food safety. For example, in January 2013, The Republic of Tea, a US-based maker of teas, herbal blends, books, and nature-inspired drinks-ware announced that it has unveiled new products, namely ‘Iced Tea - Large Tea Pouches’ and a line of ‘SuperHerb Teas’. These organic, green Rooibos-based teas are also all-natural, naturally caffeine-free and certified gluten-free, and were available for purchase from March 2013.

Figure 3: Global Beverage Manufacturers’ Industry: Revenue Growth Optimism by Region (%), 2012

 
                                                                                                                                                                                                                                                                                  

According to survey results, 50% of beverage manufacturers plan to ‘expand in emerging markets’, citing that business expansion is an essential requirement for survival in 2013; for example, in November 2012, PepsiCo inaugurated a new research center in Shanghai, China with an investment of about US$40 million, as part of its strategy to cater to the local cuisine and boost its revenues in the region. The new center will create products that cater to local tastes and match the company's existing portfolio, including hot-and-sour fish-soup potato chips, white fungus oatmeal, and sour plum soda, and will allow PepsiCo to boost its consumer testing processes and launch its products in the market.