Global Spirits Manufacturing Industry Market Research Report from IBISWorld has Been Updated

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Despite declining demand from developed markets, rising incomes and aspirational consumption in emerging markets have kept the industry growing over the past five years. During the next five years, companies will continue seeking growth opportunities in emerging markets, particularly in Asia. Major distilleries will continue aggressive acquisition activities, and large companies will increase market share through premiumization. As a result, revenue is expected to maintain its upward trend. For these reasons, industry research firm IBISWorld has updated a report on the Global Spirits Manufacturing industry in its growing industry report collection.

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Aspirational consumption and in emerging markets has kept revenue on the rise

Rising per capita spirits consumption in emerging countries and increasing demand for premium brands are driving industry revenue growth. However, the Global Spirits Manufacturing industry was hit hard by the economic downturn during 2009, with recession in many key markets constraining demand, and a collapse in air travel weighing on business and duty-free sales. “Although developed markets constrained demand, overall industry performance remained moderate, with industry growth estimated at an average rate of 4.1% annually during the five years to 2012,” says Agata Kaczanowska. In 2012, emerging markets will again provide most of the impetus for growth as debt-laden developed economies continue to struggle in Europe. Consequently, revenue will grow only about 2.7% to $229.9 billion in 2012.

During the next five years, companies are expected to continue seeking out growth opportunities in emerging economies through mergers and acquisitions. For example, major company Diageo is in talks to buy Mexican distiller Tequila Cuervo SA, the producer of Jose Cuervo-branded spirits. Furthermore, rising disposable income in emerging markets will also help drive higher volume sales and revenue during the next five years. In particular, Asia will become increasingly important to the industry as a burgeoning population, rising disposable income and aspirational consumption drive demand for regional spirits as well as international Scotch, vodka and cognac brands. Firms will increasingly compete across a range of spirits products. IBISWorld forecasts that Global Spirits Manufacturing industry revenue will grow at an during the five years through 2017.

Premiumization will also increase market share for larger companies, which are most likely to produce premium spirits. Major distilleries are expected to continue aggressive acquisition strategies like during the past five years. As a result of consolidation, the number of enterprises is expected to decline at a 2.3% annualized rate during the five years to 2017 to 13,139 businesses. The top four companies in the industry are estimated to generate about 18.6% of 2012 revenue. According to Kaczanowska, in volume terms, the concentration is even lower. This is because the global premium brands are owned by a smaller group of relatively large companies, which are taking on growth opportunities through regular acquisition activity. For example, major company Diageo is in talks to acquire Tequila Cuervo SA, the Mexican distillery that produces the premium tequila brand Jose Cuervo. For more information, visit IBISWorld’s Global Spirits Manufacturing industry report page.

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IBISWorld industry Report Key Topics

This industry consists of distilleries that purchase a range of ingredients, such as grains and sugar, and manufacture them into spirits (i.e. not beer or wine). These spirits are then bottled and sold to liquor wholesalers, bars, casinos, restaurants, hotels and other retail stores.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalization & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique industry information and analysis. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.

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Gavin Smith
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