The
global
instant coffee market is expected to witness scores of
far-reaching prospects to birth on the back of rising popularity
among consumers. The demand for instant coffee could skyrocket in the
coming years due to the advantage of quick preparation and
convenience. Moreover, the easy availability of instant coffee and
its comparatively lower price than the regular variant are
anticipated to up the growth of the overall market.
Considering
this trend in the market, top players such as Tata Global Beverages
could seize the opportunity to improve their profits and expand their
presence globally. Tata Coffee has recently announced the setup of
its Vietnam project for instant coffee with a 5,000 tons per annum
installed capacity. Tata Group chair, N. Chandrasekaran said the
project would take around three to four years to mature.
Chandrasekaran also said that the Greenfield project would require a
INR 350 cr capital expenditure.
According
to a leading market research company, Transparency Market Research
(TMR), the global instant coffee market could achieve a revenue of
US$42.5 bn by 2025, a growth from a US$28.12 bn in 2016. For the
forecast period 2017–2025, the market is predicted to rise at a
4.80% CAGR.
With
India and China exhibiting an encouraging interest for instant
coffee, Asia Pacific could garner a significant share in the coming
years. In 2016, the region had secured a 35.7% share. The uptake of
instant coffee here could be tellingly stimulated by the easier
preparation method, even though, culturally, tea is always at the top
of the minds of consumers.
However,
among other regions such as the Middle East and Africa and North
America, Europe could tread on the heels of Asia Pacific in terms of
demand. On account of a higher preference for filter coffee, North
America could testify a declining demand for instant coffee.
Furthermore, the advent of a new category of capsules and machines
making available cold carbonated drinks whenever required is foreseen
to discourage the growth of North America.
How
would Instant Coffee be Profitably Distributed in Market?
Among
the primary distribution channels, instant coffee vendors are
prognosticated to take to online and offline retail stores and B2B
segments such as restaurants and hotels. However, retail stores could
attract a massive demand in the coming years due to the availability
of a broad scope of instant coffee and eye-catching discounts and
offers directly provided by vendors. If this trend continues to hold
true for the next few years, retail stores could well lead the
international instant coffee market by 2025. In 2016, retail stores
sold a relatively vast volume of instant coffee compared to the B2B
channel. For offline sales, instant coffee could be highly favored by
supermarkets, hypermarkets, and departmental stores.
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