Australian Beverage
Intro
• ABL, in 2011 largest supplier of non-alcholic beverages
• Manufactures soft drinks, fruit drinks and milk based drinks
• 2008 CSDs growth stagnating and shareholder confidence in the company was wanning
• MD Tom Dwyer sought to reduce reliance on CSDs by investing in product development of the other NAB and diversified into the Australian snack food market, complementary food product to NAB
B The Aust bottled water manufacturing industry
• 2011 fastest growing NAB
• Growth stage, increase in per capita consumption
• Consumers have become health conscious and change their preference from CSDs to healthier beverages such as water
1. Demand and consumption trends
• Total NAB revenue in Aust was over 10b in 2011
• Aust consumed 963 litres of bottled water in 2011
• However it is lower as compared to other similar markets have higher rate of consumption, hence potential for growth
• Increasing awareness of the obesity problem in Aust and established focus toward health and wellbeing is ensuring strong future growth for healthy beverages
• Introduction of sugar-free or diet CSDs not appealing to older Australians
• Bottled water advantages: small sized plastic bottles easier to carry, resealable and has become a fashion accessory.
2. Industry segmentation 2 types still and sparkling water
• Still water
• 76% consumption, consumed for hydration and thirst satisfaction
• Fat free, calorie free thirst quencher
• Consumers not satisfied with tap water
• Convenience major factor more widespread leisure activities and expansion of travel
• Sparkling water
• 24% consumption in 2011.
• Refreshment berverage when dining out than hrdration. manufacturing costs to carbonate, different closure types to retain carbonation, costs of import and premium nature of product
3. Distribution channels
• Large retailers and hospitality