Declining beer consumption and higher competition constrain industry growth
Melbourne, Australia (PRWEB) May 29, 2013
The Beer Manufacturing industry has undergone a shake-up over the past five years. Per capita beer consumption has declined sharply as drinkers have given up traditional brands such as VB in favour of premium beers and other beverages, including cider and wine. Robust demand for craft beer has resulted in the number of breweries in the industry increasing over the past decade to 146 in 2012-13.
At the other end of the market, foreign interests have acquired Australia's two largest brewers, Foster's and Lion. According to IBISWorld industry analyst Ryan Lin, “the battle for market share between Foster's and Lion has constrained growth in industry revenue and profitability”. Deteriorating consumer sentiment and a few years of poor weather and natural disasters have contributed to revenue declines.
The Beer Manufacturing industry in Australia is highly concentrated. The three largest players are Lion Pty Ltd, Foster’s Group Limited and Coopers Brewery Limited.
Industry revenue is expected to drop slightly by 0.3% over 2012-13, as weak consumer sentiment, falling beer consumption and intensifying competition from internal and external sources continue to weigh on sales and margins. In the five years through 2012-13, industry revenue is expected to increase at an annualised rate of 0.6% to total $4.65 billion.
Growth in the Beer Manufacturing industry is expected to recover over the next five years. “The Australian beer market will become more fragmented as drinkers continue to opt for quality over quantity”, says Lin. “Growing popularity of higher margin premium beers and craft beers is likely to give the industry a welcome boost, especially as Foster's and Lion bring in domestic production of premium foreign beers”. Intense competition is expected to weigh on profitability. Traditional brands are expected to further lose market share to premium beers. Sales of craft beer are forecast to continue to boom, but the segment is likely to consolidate as the two big brewers make acquisitions and small brewers exit the industry.
For more information, visit IBISWorld’s Beer Manufacturing report in Australia industry page.
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IBISWorld industry Report Key Topics
The Beer Manufacturing industry consists of firms that manufacture, bottle and can beer, ale, stout or porter. Beer, ale and stout are packaged for sale to pubs, bars, hotels and wholesale and retail alcoholic beverage distributors.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Basis of Competition
Barriers to Entry
Technology & Systems
Regulation & Policy
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