In today's fast-growing consumer market, the soft drink industry is like a bright star, exuding unique charm and vitality. From street shops to hypermarkets, from daily thirst quenching to social gatherings, soft drinks are everywhere.
1. Overview of soft drinks
1. Definitions
Soft drinks mainly refer to non-alcoholic beverages with an ethanol content of less than 0.5% in beverages. Soft drinks are liquid foods with the main purpose of replenishing water and nutrients in the human body, and the main function is to quench thirst. Soft drinks are characterized mainly by processing or adding different additives to improve the taste of the beverage and increase the taste and flavor of the soft drink.
2. Classification
According to the national standard GBT10789-2015 "General Principles of Beverages", soft drinks can be divided into packaged drinking water, fruit and vegetable juices and their beverages, protein drinks, carbonated drinks (soda), special-purpose beverages, flavored beverages, tea (class) beverages, coffee (class) beverages, plant beverages and solid beverages according to the raw materials.
Source: Compiled by China Business Industry Research Institute
3. Industrial chain
The main raw materials of soft drinks are drinking water or mineral water, fruits, vegetables, tea, food additives, etc. The midstream is the production of various types of soft drinks, the downstream is the distribution channels, and the end is the consumer.
2. Relevant policies for the soft drink industry
In recent years, the state has issued a series of favorable policies to promote residents' consumption and promote the development of the industry. The introduction of relevant policies such as "Opinions on Building a Diversified Food Supply System with a Big Food Concept" and "Guiding Opinions on Promoting the High-quality Development of the Catering Industry" will help the development of the industry.
3. The current situation of the soft drink industry
1. Market size
According to the "2024-2029 Global and China Soft Drink Industry Development Status Survey and Investment Prospect Analysis Report" released by the China Business Industry Research Institute, the market size of China's soft drink industry in 2023 will be 909.2 billion yuan, affected by the increase in urbanization rate, disposable income growth, continuous product innovation, market segmentation and diversification of sales channels. Analysts at the China Business Industry Research Institute predict that by 2024, the size of China's soft drink market in terms of retail sales is expected to increase to 966.3 billion yuan.
Data source: National Bureau of Statistics, China Beverage Industry Association, China Business Industry Research Institute
2. Market structure
According to the "2024-2029 Global and China Soft Drink Industry Development Status Survey and Investment Prospect Analysis Report" released by the China Business Industry Research Institute, 23.65% of China's soft drink market in 2023 will be packaged drinking water, 15.77% will be tea drinks, 13.72% will be fruit juice drinks, 13.55% will be carbonated drinks, 13.33% will be functional drinks, 1.73% will be coffee drinks, and 18.26% will be others.
Data source: China Commercial Industry Research Institute
3. Output
According to the "2024-2029 Global and Chinese Soft Drink Industry Development Status Survey and Investment Prospect Analysis Report" released by the China Business Industry Research Institute, the output of China's soft drink industry in 2023 will be 175 million tons. Analysts at the China Business Industry Research Institute predict that China's soft drink production is expected to increase to 182 million tons by 2024.
Data source: National Bureau of Statistics, China Business Industry Research Institute
4. Sales channels
The main sales channels of China's soft drink market include: traditional channels, mainly small non-chain grocery stores and water delivery stations, which are usually owned and operated by individual traders or households; modern channels, mainly including large supermarkets, supermarkets and chain convenience stores; catering channels, mainly referring to restaurants and other catering service providers; E-commerce channels, mainly referring to online sales platforms; and other channels, mainly including airlines, railway stations, petrol stations, highway service areas, hotels and sports venues and other special channels, as well as other retail channels.
According to the "2024-2029 Global and China Soft Drink Industry Development Status Research and Investment Prospect Analysis Report" released by the China Business Industry Research Institute, in 2023, the sales channels of the soft drink industry will mainly be traditional channels and modern channels, accounting for 42.51% and 22.37% respectively, and catering channels, e-commerce channels, and other channels will account for 15.32%, 7.44%, and 12.35% respectively. Traditional channels and modern channels are characterized by many outlets, wide coverage, and accessibility. As a result, soft drink companies are using these channels as their primary channels to reach a wider consumer base. Analysts from the China Business Industry Research Institute predict that in 2024, traditional channels, modern channels, catering channels, e-commerce channels, and other channels will account for 42.49%, 22.39%, 15.37%, 7.75%, and 11.98% respectively.
Data source: National Bureau of Statistics, China Beverage Industry Association, China Business Industry Research Institute
5. Competitive landscape
In terms of retail sales, the CR5 of the soft drink industry in 2023 will be 42.6%, and the market is relatively concentrated. The top five companies are Wahaha, Tingxin International Group, Nongfu Spring, Coca-Cola, and China Resources Beverage.
Data source: China Commercial Industry Research Institute
Fourth, the soft drink industry key enterprises
1. Wahaha
Wahaha focuses on the main business of food and beverage. The products cover more than 200 varieties of packaged drinking water, protein drinks, carbonated drinks, tea drinks, fruit and vegetable juice drinks, coffee drinks, plant drinks, special-purpose drinks, canned food, dairy products, medicine and health food, among which pure water, AD calcium milk, nutrition express line, and eight-treasure porridge are well-known national products.
Wahaha has a wide range of soft drink products, as follows:
2. Nongfu Spring
Founded on September 26, 1996, Nongfu Spring Co., Ltd. is a leading packaged drinking water and beverage company in China, committed to providing consumers with high-quality products. The company's main products cover packaged drinking water, tea drinks, functional drinks and fruit juice drinks.
According to Nongfu Spring's 2023 financial report, Nongfu Spring will achieve operating income of 42.67 billion yuan in 2023 and net profit attributable to the parent company of 12.08 billion yuan.
By business, 47.49% of Nongfu Spring's operating income in 2023 was created by aquatic products, and the rest of the operating income was generated by other businesses.
Nongfu Spring has a total of 12 major water sources. They are Qiandao Lake in Zhejiang, Wanlv Lake in Guangdong, Danjiangkou in Hubei, Manas in Tianshan Mountains in Xinjiang, Mount Emei in Sichuan, Taibai Mountain in Shaanxi, Changbai Mountain in Jilin, Wuling Mountain in Guizhou, Daxinganling Mountain in Heilongjiang, Wuyi Mountain in Fujian, Daming Mountain in Guangxi and Huangshan Mountain in Anhui.
Nongfu Spring has a variety of product types, as follows:
3. Dongpeng Beverage
Dongpeng Beverage (Group) Co., Ltd.'s main business is the research and development, production and sales of beverages, the main products include Dongpeng Special Drink, Dongpeng Big Coffee, Dongpeng Hydration, Packaged Drinking Water, etc., and Dongpeng Special Drink is the company's leading products and main source of revenue.
According to Dongpeng Beverage's 2023 financial report, Dongpeng Beverage achieved operating income of 11.26 billion yuan and net profit attributable to the parent company of 2.040 billion yuan.
4. Yangyuan drink
The main business of Hebei Yangyuan Zhihui Beverage Co., Ltd. is the research and development, production and sales of plant-based protein beverages made from walnut kernels. The company's main products are walnut milk (milk) drinks, almond milk (milk) drinks, peanut milk (milk) drinks, coconut water (milk) drinks, soybean milk (milk) drinks and other varieties. Among them, walnut milk is the company's main source of operating income.
According to Yangyuan Beverage's 2023 financial report, Yangyuan Beverage achieved an operating income of 6.162 billion yuan and a net profit attributable to the parent company of 1.467 billion yuan.
5. VV shares
VV Food & Beverage Co., Ltd.'s main business is engaged in the research and development, production and sales of soybean milk powder, plant-based protein beverages (liquid soybean milk), dairy products, tea and other products, as well as grain purchase, warehousing, trading and processing. The company's main products are solid prepared beverages, animal and plant protein liquid beverages, tea, and grain primary processing products. The company owns a number of national well-known brands and well-known trademarks such as "VV", "Tianshan Snow", "Liuchaosong" and "Yiqingyuan", as well as local well-known brands such as "VV Tycoon".
According to VV's 2023 financial report, VV achieved operating income of RMB 4.036 billion and net profit attributable to the parent company of RMB 210 million.
In terms of products, in 2023, 48.79% of VV's business composition was created by solid prepared beverages, 10.83% by animal and plant protein beverages, 0.92% by tea, and the remaining operating income was generated by other businesses.
6. Fragrance fluttering
The main business of Xiangpiaopiao Food Co., Ltd. is the research and development, production and sales of beverage-related products, which are divided into two product segments: brewing and ready-to-drink. It mainly includes "Xiang Piaopiao" classic series, good material series, "fresh" oat milk tea, "fresh coffee" oat latte, etc.; The ready-to-drink business segment mainly includes "Meco" cup fruit juice tea, "Lan Fang Yuan" Hong Kong-style tea, "Xiang Piaopiao" ready-to-drink milk tea and other products.
According to Xiangpiaopiao's 2023 financial report, Xiangpiaopiao achieved an operating income of 3.625 billion yuan and a net profit attributable to the parent company of 280 million yuan.
By product, in 2023, 74.08% of Xiangpiaopiao's main business composition will be created by brewing products, 24.86% will be created by ready-to-drink products, and the remaining operating income will be created by other businesses.
7. Chengde Lulu
The main business of Chengde Lulu Co., Ltd. is the production and sales of plant-based protein beverages. The company's main product is Lulu almond milk.
According to Chengde Lulu's 2023 financial report, Chengde Lulu achieved an operating income of 2.955 billion yuan and a net profit attributable to the parent company of 638 million yuan.
5. The development trend of the soft drink industry
1. Increase in purchasing power and per capita consumption
China's rising urbanization rate and rising per capita disposable income continue to increase consumers' purchasing power for soft drinks, which is further driving the growth of China's soft drinks market. At the same time, the per capita soft drink consumption of Chinese in 2023 (124.7 liters) is still much lower than that of developed markets such as United States (402.2 liters), Japan (195.7 liters) and Hong Kong (172.3 liters), indicating that China's soft drink market has huge growth potential. The growth of soft drink consumption per Chinese is expected to follow the past growth trend in developed markets.
2. Diversification of sales channels
Traditional and modern channels continue to dominate soft drink sales in China due to their unique consumer engagement opportunities and other advantages, while diversified and emerging sales channels, including e-commerce channels and F&B channels, have improved the consumer buying experience and are gaining traction among consumers. In addition, the development of delivery services has helped modern and traditional channels to expand their reach, while improving consumer convenience and product accessibility. The development of diversified sales channels in the soft drink market is expected to boost consumer purchases of soft drink products, thereby gradually unleashing the market potential of all tiers of cities.
3. Health awareness is increasing
Similar to many other countries, Chinese consumers have been increasingly health-conscious when it comes to food and beverage consumption in recent years. Health concepts such as zero/low sugar, zero/low calorie, no additives, herb-based, plant-based and efficacy are becoming increasingly popular in China's soft drink market. These trends will continue to drive growth in certain product categories, such as packaged drinking water and sugar-free beverages, making them more popular than other beverage categories.
4. Launch new products to continuously meet consumer needs
China's leading soft drink companies continue to diversify their product offerings and expand their coverage in various soft drink categories to meet changing consumer needs and consumption scenarios. In particular, the boundaries between packaged drinking water and other soft drinks are gradually blurring, extending to flavored water, sparkling soda and other categories of beverages with rich taste, sufficient texture and diverse functions to meet consumers' health, taste and nutritional preferences.
For more information, please refer to the "Research Report on Market Prospects and Investment Opportunities of China's Soft Drink Industry" released by the China Commercial Industry Research Institute, and the China Commercial Industry Research Institute also provides industrial big data, industrial intelligence, industry research reports, industry white papers, industry status certificates, feasibility study reports, industrial planning, industrial chain investment map, industrial investment guidelines, industrial chain investment investigation & promotion meeting, "15th Five-Year Plan" and other consulting services.