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Insight

Saudi Soft Drinks Market Continues to Fizz

Soft Drinks Sector

By volume, Saudi Arabia’s soft drinks industry accounts for about two thirds of the GCC region’s soft drinks sector. The soft drinks sector is divided into the cold drinks segment – fruit juice, dairy drinks, bottled water and carbonated beverages – and the hot drinks segment, dominated by tea and coffee.

In per capita terms, consumption of soft drinks has increased from 217 litres in 2004 to more than 250 litres in 2014, over which period the industry grew from $5.5 billion to $8.5 billion. Bottled water and carbonates make up 80 percent of sales.

Saudi Market

The Saudi market has a number of characteristics that are of particular interest to international investors. In most markets, the soft drinks sector faces stiff competition from the alcoholic drinks sector, which is not a factor in the KSA where alcohol is prohibited. A second factor is the year-round hot climate in Saudi Arabia, where people have to rehydrate regularly. A third factor is a large and growing Saudi population, which at 29 million people makes it the largest market in the GCC, with young people making up more than half of the population.

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Author

Najeeb Alhumaid

Partner (Saudi Arabia)

Najeeb is a Partner at Farrelly & Mitchell’s Riyadh office. Clients in Saudi Arabia and across the region gain from his excellent track record and expertise.

Saudi Soft Drinks Market Continues to Fizz

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Saudi Soft Drinks Market Continues to Fizz

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Soft Drinks Sector

By volume, Saudi Arabia’s soft drinks industry accounts for about two thirds of the GCC region’s soft drinks sector. The soft drinks sector is divided into the cold drinks segment – fruit juice, dairy drinks, bottled water and carbonated beverages – and the hot drinks segment, dominated by tea and coffee.

In per capita terms, consumption of soft drinks has increased from 217 litres in 2004 to more than 250 litres in 2014, over which period the industry grew from $5.5 billion to $8.5 billion. Bottled water and carbonates make up 80 percent of sales.

Saudi Market

The Saudi market has a number of characteristics that are of particular interest to international investors. In most markets, the soft drinks sector faces stiff competition from the alcoholic drinks sector, which is not a factor in the KSA where alcohol is prohibited. A second factor is the year-round hot climate in Saudi Arabia, where people have to rehydrate regularly. A third factor is a large and growing Saudi population, which at 29 million people makes it the largest market in the GCC, with young people making up more than half of the population.

To download the full insight, click here

Download Full Insight

Author

Najeeb Alhumaid

Partner (Saudi Arabia)

Najeeb is a Partner at Farrelly & Mitchell’s Riyadh office. Clients in Saudi Arabia and across the region gain from his excellent track record and expertise.

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