Exotic beverages are expected to continue boosting industry revenue
New York, NY (PRWEB) January 10, 2014
Growing health concerns, as a result of the rise in obesity and diabetes, has encouraged beverage customers to become increasingly selective with their drink consumption, migrating away from carbonated soft drinks (IBISWorld report 31211a) and towards industry products or bottled water (31211b). Marketing campaigns for low-calorie and all-natural beverages, as well as added fibre, omega-3 and probiotics, have further stimulated the movement towards juice substitutes. Consequently, over the past five years, Juice Production industry revenue has grown at an average annual rate of 1.0%, reaching $2.3 billion in 2013.
According to IBISWorld Industry Analyst Sarah Kahn, “Demand for new products has been fuelling industry revenue, as producers invest heavily in research and development and market increasingly varied and exotic drinks, such as coconut water, tropical flavours and kombucha.” New companies have been taking advantage of such opportunities, created by variety in demand, attracting new businesses and driving industry expansion. Additionally, increased consumer spending has been expanding demand from convenience stores, loosening consumers' pockets and encouraging impulsive on-the-go purchases of discretionary industry products. Revenue is therefore expected to grow 5.1% in 2013 alone, as the high investment in marketing and research and development begins to flourish.
“Over the next five years, exotic beverages are expected to continue boosting industry revenue as per capita soft drink consumption continues to decrease,” says Kahn. This is because a new concern regarding controlling sugar intake is driving consumers away from high sugar juices to more healthful alternatives. Increasing demand from grocery stores and supermarkets will also provide a stable revenue stream while rising per capita disposable income will continue to encourage impulse purchases from convenience stores and vending machines. Innovative and healthy products, coupled with the increasing prices of new brands, are expected to stabilize industry profit. Consequently, revenue is expected to increase at an average annual rate of 6.8% over the coming five years.
The Juice Production industry is highly fragmented. Market share concentration has slightly increased over the past five years through acquisitions, contracts and new product development. Additionally, Canadians are still drinking lots of soda, and sugary drink consumption and soda consumption are continuing to grow. Rising rates of obesity and diabetes are expected to help shift consumer preferences. As Canadian consumers shift their preferences away from carbonated soft drinks and to fruit juices, this industry is expected to continue growing, with new companies entering the market and creating new flavours.
For more information, visit IBISWorld’s Juice Production in Canada industry report page.
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IBISWorld industry Report Key Topics
The Juice Production industry primarily produces fruit-based and fruit-flavoured beverages, as well as other nonalcoholic beverages, including iced coffee, iced tea, sports drinks and energy drinks. Production of carbonated soft drinks (CSDs), ice and bottled water are not included in this industry.
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