Room For Growth Across Soft Drinks
As the region's largest economy by some distance, it is no surprise that Saudi Arabia's soft drinks industry is also the Gulf region's largest in volume terms. By volume, we believe that it accounts for about two thirds of the region's soft drinks sector. In per capita terms, consumption of soft drinks, which by our definition includes bottled water, carbonates, juices and functional drinks (energy drinks), increased from 217 litres in 2004 to nearly 2 53 litres in 201 2 . In value terms, the size of the industry grew from US$5.5bn to US$ 8.5 bn over the period, with bottled water and carbonates between them making up about 80% of sales.
The carbonates category has been the slowest grower in volume terms in particular over the past few years, which is hardly surprising given its relative maturity. Just like in the wider Gulf region, bottled water sales really took-off over the past decade, driven by rising incomes. Per capita GDP has grown considerably, reaching well over US$15,00 0. [is this figure right? If so put the comma after the 1] In per capita terms, bottled water consumption increased from about 95 litres in 2004 to more than 1 15 litres by 201 2 . Concerns over the safety of tap water and Saudi Arabia's harsh climate provide a great environment for the bottled water industry. A big trend over the period was the take-off in bulk water. Innovation and rising health-consciousness will continue to have strong influences over the next few years, which should be especially good for die t carbonates, juices and water.
Going forward, we see a lot of room for growth in the energy drinks sector. Globally , energy drinks have really taken off over the past decade, and in the developed world in particular have continued to perform well even as the global economy has weakened. We fully expect the category to continue to lead the industry from a growth point of view over the next few years in Saudi Arabia as more money is pumped into the sector.
|Water Widely Consumed|
|Saudi Arabia Carbonated Drinks and Bottled Water Sales (mn litres) - Historic & Forecast|