Abstract
Why buy this report
- Get insight into trends in market performance
- Pinpoint growth sectors and identify factors driving change
- Identify market and brand leaders and understand the competitive
environment
Product coverage
Coffee; Other hot drinks; Tea
Executive summary
Modest increase in hot drinks consumption
Hot drinks consumption continues to increase at a moderate pace in the Czech
Republic. Tea was the best performing category in 2008 while other hot drinks
experienced a drop in volume sales. Coffee remained the largest category in
both volume and value terms in 2008 and was followed by tea and other hot
drinks. In comparison with 2007, all hot drinks categories performed better
during 2008. Coffee consumption was driven by the increasing popularity of
speciality coffee products and cheaper prices for premium brands whilst tea
sales were fuelled by increasing consumer health awareness. Other hot drinks
sales are dominated by the popular Granko and Caro brands.
Increasing demand for healthier hot drinks products
Although fresh coffee continues to account for the majority of coffee sales,
instant coffee brands are experiencing higher volume growth due to its
convenience and good taste. Within tea, consumers are attracted towards
products which offer added value such as specific health attributes and new
flavours. While fruit and herbal tea and green tea experienced positive growth
in 2008, black standard tea continued to lose ground. In addition, Rooibos tea
continues to increase in popularity whilst white tea also has significant
potential. Within other hot drinks, the first functional drinks, such as
Mokate Delicious Milky Chocolate with calcium and Mokate Delicious Dark
Chocolate with magnesium were introduced to the Czech Republic in 2008.
Multinationals dominate sales
Recent acquisitions (such as Marila Balirny by Arca Capital, Jemca by Tetley
Group, and Dukat by Mokate Group) of Czech companies by multinationals mean
that hot drinks sales are dominated by foreign players, with just four
companies - Tchibo, Balirny Douwe Egberts (Sara Lee), Nestlé and Kraft Foods
- accounting for a combined value share of over 60% in 2008. In comparison,
private label producers recorded a value share of just 3% in 2008. This
relatively poor performance can be attributed to the fact that there is
already a wide assortment of good quality, reasonably priced, branded tea in
the Czech Republic.
Distribution dominated by supermarkets/hypermarkets and Independent small grocers
Supermarkets/hypermarkets and Independent small grocers dominate hot drinks
sales in the Czech Republic, accounting for a combined 74% of total retail
volume sales in 2008. However, sHowever, sHpecialty teashops were estimated to
account for over 10% of tea volume sales in 2008 and an increasing number of
such outlets are opening within shopping centres.
Good expectations for hot drinks in near future
Hot drinks is expected to record significant growth over the forecast period.
Coffee consumption will be driven by new product development (mostly within
the standard and premium price categories), increased home coffee machine
ownership, and rising consumer sophistication. Tea consumption will be fuelled
by increasing consumer health awareness and the introduction of new innovative
flavours.
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