‘ Aggressive domestic
competition in Thailand has pushed down prices and encourage drink producers to look abroad. Ichitan, for example, reported a 19 % fall in sales in the 1st half
, of 2016
Insight
Asia
ASEAN Update
** Source: Asia Food & Beverages Report
Thai beverage producers looking at neighboring markets for growth
T hailand’ s beverage makers, from soft drinks to juices and tea products, which in the past have focused on the domestic market, are now setting their sights on the neighboring markets for growth. Thai manufacturers have a competitive edge over Western rivals as they have successfully developed products that resemble, both in terms of taste and preferences, to those in neighboring countries. ASEAN consumers, just like the Thais, live in a tropical climate and prefer the‘ sweeter variant’ of soft drinks and juice products.
Aggressive domestic competition in Thailand has pushed down prices and encourage drink producers to look abroad. Ichitan, for example, reported a 19 % fall in sales in the 1st half of 2016, attributing the decline to a price war with rivals.
Euromonitor International estimated that the soft drink market in 6 ASEAN countries namely Thailand, Singapore, Vietnam, the Philippines, Malaysia and Indonesia will grow to 53.5 billion litres by 2020, up 30 % from 2015. Over the period, growth in Thailand is expected to slow, while those in Vietnam and Indonesia will grow at a significantly faster pace than the average of the 6 countries.
With under-14-year-olds already making up less than 20 % of its population as the country ages, Thailand does not offer drink producers much hope for growth. In Vietnam and Indonesia, on the other hand, that age group makes up over 20 % of the population and is expected to grow further. Despite the gloomy projection, there is still room for growth in Thailand particularly for certain segments like herbal teas and sports drinks, as people become increasingly health conscious.
‘ Aggressive domestic
competition in Thailand has pushed down prices and encourage drink producers to look abroad. Ichitan, for example, reported a 19 % fall in sales in the 1st half
, of 2016
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