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Saudi Arabia Soft Drinks Market - Industry Demand Analysis and Opportunity Assessment 2018-2027

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Extensive insights into the Growth of Saudi Arabia Soft Drinks Market amidst COVID-19

Before we witness the stabilization of economic growth in Europe and North America, Asia Pacific is estimated to bounce back progressively with countries such as China, India, South Korea and Japan witnessing more opportunities to recover from the losses sustained during COVID-19.

Being the biggest market in Eastern Europe, Russia is estimated to take the lowest hit, offering a sigh of relief to the businesses operating in the country. Whereas, GCC is estimated to observe low investments due to the sliding prices of crude oil.

We evaluate the strategies and commitment of the Giant Players in the market towards creating products and services that customers value and rely on.

In an attempt to control and eliminate the surge of coronavirus cases and meet the demand for required medical devices along with providing efficient medical services, there is a drastic shift of investments from authoritative bodies towards the healthcare sector. Where the aftermath of this pandemic may take years to be measured, Research Nester estimates notable expansion of e-health, gaming, and media and entertainment industries till the whole situation is contained and the plan of action for the recovery process is determined. There is an estimated probability of the growth in businesses going back a year if the condition is controlled in the next 2-3 months.                                                         Request Insights

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IN THE NEWS
  • February 2020: The Coca-Cola Company announced the launch of a ginger flavored drink added to its traditional lemon-based drink Sprite known as Sprite Ginger and is available in different packaging size including bottles of 20-oz and 2 liters along with cans of 12-oz.

  • March 2020: PepsiCo, Inc., announced to acquire the US-based manufacturer of energy drinks, named Rockstar Energy Beverages upon an agreement for a deal value worth USD 3.85billion. This acquisition will help PepsiCo, Inc., to expand the product portfolio of the company.

Market Overview

The increasing popularity of healthier variants of soft drinks amongst the consumers including drinks such as kombucha and other types of functional teas which is raising the need amongst the manufacturers to produce different types of beverages, coupled with the opportunities generated by the availability of various flexible packaging alternatives including bags or pouches and the increasing economic and social transformation in the country which is promoting the number of quick service restaurants in tandem with the gradually changing dining-out culture are some of the factors anticipated to promote towards the growth of the Saudi Arabia soft drinks market. Numerous manufacturers in the beverage industry are increasingly focusing on developing healthier variants of soft drinks by differentiation in the existing products as well developing innovative beverages which are low in calories and align with the active lifestyle of consumers thereby promoting good health. The Saudi Arabia soft drinks market is slated to grow with the highest CAGR of 8.56% over the forecast period 2020-2027. Presence of a hot climate in the country along with the dynamic change in consumer preferences for beverages are some of the factors anticipated to promote towards the growth of the market. Further, the Saudi Arabia soft drinks market accounted for USD 4845.3 million in the year 2018 and is predicted to reach USD 9984.8 million in the year 2027. Moreover, the market is anticipated to gain an incremental $ opportunity of USD 835.6 million in the year 2027 as compared to the previous year.

Market Drivers and Challenges

Growth Indicators

According to the statistical report Global Status Report on Alcohol and Health 2018 by the World Health Organization, the recorded alcohol consumption per capita aged 15+ in Saudi Arabia during the period 1961-2016 is almost zero. Additionally, the alcohol per capita (15+) consumption recorded in the year 2016 was 0.2 litres of pure alcohol.

The Saudi Arabia soft drinks market is thriving on the back of the prohibition on the consumption, import, brewing and sale of alcoholic drinks in the nation along with the presence of an arid climate in the country, which is raising the popularity for soft drinks including carbonated beverages and other ready to drink teas and coffees. The ban on alcoholic beverages in the country can be attributed to the conservative nature of the Islamic nation which promotes strict measures to follow Islamic laws. As such, the competition from alcoholic beverages is the minimum in comparison to other nations of the world, thereby providing a greater opportunity for players to international investments in the soft drink beverage industry. CLICK TO DOWNLOAD SAMPLE REPORT

Additionally, the hot and humid climate in the nation raises the need amongst the people to rehydrate regularly over the time frame, which is also contributing to the rising demand for soft drink beverages. Moreover, increasing young population in the country and the rising health consciousness among the consumers are some of the factors anticipated to drive the growth of the Saudi Arabia soft drinks market. According to the statistics by the World Bank, the population in Saudi Arabia grew from 32.42 million in the year 2018 to 33.69 million in the year 2018, thereby registering an increase of 1.27 million in a span of 2 years.

Barriers

Increase in the excise taxes on all types of sweetened beverages in the nation to limit the consumption of unhealthy beverages especially by the young population in the country along with the impact of the COVID-19 pandemic which hampers the manufacturers of soft drinks in sourcing their raw materials used in the preparation of soft drinks are some of the factors anticipated to impact negatively towards the growth of the Saudi Arabia soft drinks market.

Competitive Landscape

The soft drinks market in Saudi Arabia is primarily driven by the key players, namely The Coca-Cola Company and PepsiCo, Inc. Apparently, the market is highly fragmented with several local players who are serving soft drinks in different packaging forms to meet the customer demand.

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