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Market analysis - Essay Example

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The British soft drinks industry consists of carbonates, fruit/ vegetable juice, bottled water, functional drinks, concentrates and ready-to-drink tea and coffee. The fruit and vegetable juice sector consists of two groups: long-life fruit juices (non-chilled) and fresh fruit juices (chilled)…
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Download file to see previous pages In general, soft drinks manufacturers have adapted to the new ways of living by responding to the demand for healthier products. This has helped add value to their products and generate growth.
In 2004, total consumption of fruit/ vegetable juice increased by 7% and by 2009, the overall market conditions are projected to remain highly favourable for the fruit/ vegetable juice sector. 100% juice is expected reach volume growth of 43% and volume sales of 221 million litres or 384 million euros by 2009. (Euromonitor 2005) This supports the entry of Fruitness into the growing juice sector.
Major players in the industry such as Coca-Cola, Spadel, Sunco (bottler and distributor of PepsiCo), Danone, Unilever, Nestle, Materne-Confilux, Wesergold, Melitta (Granini) and Looza (Tropicana) have manufacturing plants and distribution networks all over UK. As Fruitness will target companies in London only, our manufacturing facility will be located in or in close proximity to London.
While the sector shows positive growth for the next three years, juice and nectar producers are already looking for new ways of keeping sales growing. As such, product innovation as well as packaging and pack sizes are very important in the juice/ vegetable juice industry.
Orange is the most popular flavour with 17% share of the sector volume sales, grapefruit is second with 11% and tomato is third with 9%. As orange is still the leader, Fruitness is focusing on pure orange and orange based juices. Once established, Fruitness will invest in additional equipment in order to expand its existing product range and cater for customer's growing interest in other flavours.
100% juices dominate fruit/ vegetable juice products and the leading performance among the fruit/ vegetable juice sector is taken by 100% juice. The popularity of this subsector is due to the increasingly active and sporty British consumer lifestyle and interest in healthier diet. Nectars and juice drinks are less popular among the British consumers. Promotional activities and the presentation of a variety of fresh 100% juices by companies such as Looza and Melitta, have created a significant consumer awareness of the health benefits of these products and as a result, there have subsequently been consumer shifts towards these.
In addition, there has been a slight shift from long-life products to chilled/ short-life products in 2003 and 2004. Industry sources also expect stronger forecast period growth for chilled/ short-life products due to the fact that the majority of British consumers are against concentrates and prefer more natural, fresh products.
To summarize, the main trends in the juice industry are differentiation including the incorporation of new flavours, new packaging formats and more targeted marketing as well as the reduction in calories and sugar and inclusion of vitamins C, E, minerals, selenium and phytosterols. In addition carbonated beverage manufacturers have already started to develop healthier products, such as juice with calcium, especially for women, and ...Download file to see next pagesRead More
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