Sales of Ready-To-Drink (RTD) Spirits, such as Smirnoff Ice and Bacardi Breezer, are Currently Declining in the UK after A 5-Year Boom Period

Dublin (PRWEB) December 21, 2005

Research and Markets (http://www.researchandmarkets.com/reports/c29791) has announced the addition of Drinks Market Review 2005 to their offering

The market for the main alcoholic and non-alcoholic drinks bought by UK consumers was worth an estimated £51.85bn in 2004. Spending on drinks accounted for 7.2% of all consumer spending in the same year.

The drinks consumed in the UK include many indigenous products, such as Scotch whisky, ales and other `dark beers', squash (concentrated soft drinks) and the UK's most traditional thirst-quencher, tea. However, drinks from a variety of foreign origins are also well established in the British diet. There has been a major trend towards drinking wine with meals or as an alternative to beer or spirits, and demand for bottled water continues to increase. Another important long-term trend is taking place in the beer market, where lager (the style of beer favoured almost everywhere else in the world) is continuing to erode the share held by the UK's dark beers.

Young people are increasingly choosing fashionable new drinks, rather than traditional ones, when they start drinking alcohol. However, products come and go in this market. For example, sales of ready-to-drink (RTD) spirits, such as Smirnoff Ice and Bacardi Breezer, are currently declining after a 5-year boom period. Another outstanding sector among young drinkers is the `energy' soft drinks, such as Red Bull and Lucozade Sport.

In terms of distribution, demand for drinks is met by numerous outlets, with a basic split between take-home outlets and the on-trade/catering sector (pubs, restaurants, bars, etc.) In the on-trade, which accounts for over 70% of the value of alcohol sales, attention is currently focused on the problem of binge drinking and the impending relaxation of the licensing laws in 2005. The take-home market features price wars among the grocery multiples, with discounts for bulk purchasing (two-for-the-price-of-one offers, etc.) making it difficult for off-licences to survive. The smaller retailers do, however, offer convenience and serve the substantial impulse market for drinks.

Most of the leading drinks brands now come from massive multinational groups, which have extended themselves so far in certain sectors that the regulatory authorities are unlikely to allow further major mergers in the future. Examples include the two US cola giants, Coca-Cola and PepsiCo. European companies with a stake in the UK include InBev of Belgium (the owner of Stella Artois, the UK's top beer brand) and Pernod Ricard of France (the owner of whisky distilleries and the distributor of Jacob's Creek, a popular branded wine). The UK is itself home to several drinks companies with international operations, including Diageo (spirits, wine and beer), Scottish & Newcastle (beer and cider), Allied Domecq (wines and spirits), Cadbury Schweppes (soft drinks) and Unilever (tea).

Regulations on market share will ensure that the structure of brand ownership remains fairly steady in the future, and indeed this will reflect trends in these mainly saturated markets. Very slow growth is forecast at current prices for the total drinks market between 2005 and 2009. Wine will fare best, along with soft drinks, while beer and hot drinks are among the sectors that are likely to contract in size.

For more information visit http://www.researchandmarkets.com/reports/c29791

Laura Wood

Senior Manager

Research and Markets

Fax: +353 1 4100 980

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