zenithinternational specialist consultants to the food and drink industries worldwide
Zenith Report China Bottled Water 2015
STRATEGY & MANAGEMENT MERGERS & ACQUISITIONS COMMERCIAL & MARKET OPERATIONS & TECHNICAL WATER & GEOTHERMAL ENVIRONMENT & CARBON PACKAGING & DISTRIBUTION
Methodology Research note In undertaking its research for this latest series of reports, Zenith depends upon the goodwill and co-operation of operators active in the marketplace and, as such, achieves a high level of accuracy. Throughout its ongoing research, Zenith has also utilised its internal data library and global databases, alongside other third party sources. Liability Whilst every effort has been made to ensure that the information presented in this document is accurate and that the opinions expressed are sound, Zenith International Ltd cannot be made liable for any errors or omissions or for any losses or consequential losses resulting from decisions based on its contents. Zenith International Ltd 7 Kingsmead Square Bath BA1 2AB United Kingdom t +44 (0) 1225 327900 f +44 (0) 1225 327901
www.zenithinternational.com
2
Contents CHINA BOTTLED WATER MARKET ------------------------------------------------- 5 Bottled water volume ---------------------------------------------------------------------------------------- 6 Market volume trends 2010-14 --------------------------------------------------------------------------------------------------------------------------------- 7 Volume segmentation 2010-14 --------------------------------------------------------------------------------------------------------------------------------- 8 Market volume forecast 2015-19f ------------------------------------------------------------------------------------------------------------------------------ 9
Bottled water value----------------------------------------------------------------------------------------- 10 Market value trends 2010-14 ----------------------------------------------------------------------------------------------------------------------------------11 Market value forecast 2015-19f -------------------------------------------------------------------------------------------------------------------------------12 Average value per litre 2010-14 -------------------------------------------------------------------------------------------------------------------------------13
Key manufacturers ----------------------------------------------------------------------------------------- 14 Leading manufacturers by volume 2010-14 ---------------------------------------------------------------------------------------------------------------15
Key brands --------------------------------------------------------------------------------------------------- 16 Leading brands by volume 2010-14 -------------------------------------------------------------------------------------------------------------------------17
Channel distribution---------------------------------------------------------------------------------------- 18 Distribution split by volume 2010-14 -------------------------------------------------------------------------------------------------------------------------19
Packaging ---------------------------------------------------------------------------------------------------- 20 Packaging size split by volume (litres) 2010-14 ----------------------------------------------------------------------------------------------------------21
3
CHINA REGIONAL BOTTLED WATER MARKETS ---------------------------- 22 REGION A --------------------------------------------------------------------------------------------------- 23 Region A Bottled Water Volume ------------------------------------------------------------------------ 24 Market volume trends 2010-14 --------------------------------------------------------------------------------------------------------------------------------25 Volume segmentation 2010-14 --------------------------------------------------------------------------------------------------------------------------------26 Market volume forecast 2015-19f -----------------------------------------------------------------------------------------------------------------------------27
Region A Bottled Water Value -------------------------------------------------------------------------- 28 Market value trends 2010-14 ----------------------------------------------------------------------------------------------------------------------------------29 Average value per litre 2010-14 -------------------------------------------------------------------------------------------------------------------------------30
Region A Key Manufacturers ---------------------------------------------------------------------------- 31 Leading manufacturers by volume 2012 & 2014 ---------------------------------------------------------------------------------------------------------32
Region A Key Brands ------------------------------------------------------------------------------------- 33 Leading brands by volume 2012 & 2014 -------------------------------------------------------------------------------------------------------------------34
Region A Channel Distribution -------------------------------------------------------------------------- 35 Distribution split by volume 2014 -----------------------------------------------------------------------------------------------------------------------------36
Region A Packaging --------------------------------------------------------------------------------------- 37 Packaging size split by volume (litres) 2010-14 ----------------------------------------------------------------------------------------------------------38
Appendix------------------------------------------------------------------------------------------------------ 39 Definitions -----------------------------------------------------------------------------------------------------------------------------------------------------------40 Acronyms -----------------------------------------------------------------------------------------------------------------------------------------------------------42
4
CHINA BOTTLED WATER MARKET
5
Bottled water volume
6
China bottled water Market volume trends 2010-14 China Bottled Water Market - Volume
Million litres
2010
2011
2012
2013
2014
12,000 10,000
10,000
10,000
10,000
10,000
Bottled water (mln litres)
10,000 8,000
% Change
6,000
Small pack (mln litres)
4,000
Bulk (mln litres) 2,000
Total per capita consumption (litres)
0 2010
Commentary
Commentary
Commentary
2011
2012
2013
2014
7
China bottled water Volume segmentation 2010-14 Volume % share 2014 Volume % share Bulk 33.0%
Still packaged 33.0%
2010
2011
2012
2013
2014
Still packaged Sparkling packaged Bulk
Sparkling packaged 34.0%
Commentary
Commentary
Commentary
8
China bottled water Market volume forecast 2015-19f Million litres
China Bottled Water Market – Volume Forecast
12,000 10,000
10,000
10,000
10,000
10,000
10,000 8,000
2015f
2016f
2017f
2018f
2019f
Bottled water (mln litres) % Change
6,000
Small pack (mln litres)
4,000
Bulk (mln litres)
2,000
0 2015f
2016f
Commentary
Commentary
Commentary
2017f
2018f
2019f
Total per capita consumption (litres)
9
Bottled water value
10
China bottled water Market value trends 2010-14 CNY million 12,000
Bottled water value 10,000
10,000
10,000
10,000
10,000
10,000
2010
2011
2012
2013
2014
CNY million % growth
8,000
€ million
6,000
% growth
4,000
US$ million 2,000
% growth 0 2010
Commentary
Commentary
Commentary
2011
2012
2013
2014
11
China bottled water Market value forecast 2015-19f CNY million
12,000 10,000
10,000
10,000
10,000
10,000
10,000
Bottled Water Value Forecast
2015f
2016f
2017f
2018f
2019f
CNY million
8,000
% growth
6,000
€ million
4,000
% growth
2,000
US$ million % growth
0 2015f
Commentary
Commentary
Commentary
2016f
2017f
2018f
2019f
12
China bottled water Average value per litre 2010-14 Average value per litre CNY 1.10 1.00 0.90 0.80 0.70 0.60 0.50 0.40 0.30 0.20 0.10 0.00
1.00
1.00
1.00
1.00
1.00
2010
2011
2012
2013
2014
Bottled water (CNY) Small pack (CNY) Bulk (CNY) Bottled water (€) Small pack (€) Bulk (€) Bottled water (US$)
2010
2011
2012
2013
2014
Small pack (US$) Bulk (US$)
Commentary
Commentary
Commentary
13
Key manufacturers
14
China bottled water Leading manufacturers by volume 2010-14 Manufacturer volume % share 2014 Manufacturer 5 20.0%
Manufacturer 1 20.0%
Volume sales (mln litres) Manufacturer 1 Manufacturer 2
2010
2011
2012
2013
2014
2010
2011
2012
2013
2014
Manufacturer 3 Manufacturer 4 Manufacturer 5 Others
Manufacturer 4 20.0%
Manufacturer 2 20.0%
Manufacturer 3 20.0%
Volume % share Manufacturer 1 Manufacturer 2 Manufacturer 3 Manufacturer 4 Manufacturer 5 Others
The order of manufacturers is based on 2014 ranking.
Commentary
Commentary
Commentary
15
Key brands
16
China bottled water Leading brands by volume 2010-14 Brand volume % share 2014 Brand 5 20.0%
Volume sales (mln litres)
Brand 1 20.0%
2010
2011
2012
2013
2014
2010
2011
2012
2013
2014
Brand 1 Brand 2 Brand 3 Brand 4 Brand 5
Volume % share Brand 4 20.0%
Brand 2 20.0%
Brand 1 Brand 2 Brand 3 Brand 4
Brand 3 20.0%
Brand 5 The order of brands is based on 2014 ranking.
Commentary
Commentary
Commentary
17
Channel distribution
18
China bottled water Distribution split by volume 2010-14 Channel volume % share 2014 HOD 20.0%
Channel – Volume % Share
Modern trade 20.0%
2010
2011
2012
2013
2014
Modern trade Discounters Traditional stores OOH
OOH 20.0%
Discounters 20.0%
HOD Total
Traditional stores 20.0%
Commentary
Commentary
Commentary
19
Packaging
20
China bottled water Packaging size split by volume (litres) 2010-14 Packaging size volume % share 2014 Volume % share >10 litres 35.0%
0-2 litres 35.0%
2010
2011
2012
2013
2014
0-2 litres >2 to 10 litres >10 litres Total
>2 to 10 litres 30.0%
Commentary
Commentary
Commentary
21
CHINA REGIONAL BOTTLED WATER MARKETS
Guangdong Sichuan Hunan Hubei Yunnan Shanghai
22
REGION A
23
Region A Bottled Water Volume
24
Region A bottled water Market volume trends 2010-14 Million litres
Bottled Water Market Volume
12,000 10,000
10,000
10,000
10,000
10,000
10,000
2010
2011
2012
2013
2014
Bottled water (mln litres)
8,000
% Change
6,000
Small pack (mln litres)
4,000
Bulk (mln litres)
2,000 0 2010
Commentary
Commentary
Commentary
2011
2012
2013
2014
25
Region A bottled water Volume segmentation 2010-14 Volume % share 2014
Bulk 33.0%
Still packaged 33.0%
Volume % share
2010
2011
2012
2013
2014
Still packaged Sparkling packaged Bulk water
Sparkling packaged 34.0%
Commentary
Commentary
Commentary
26
Region A bottled water Market volume forecast 2015-19f Million litres 12,000 10,000
Bottled Water Market – Volume Forecast
8,000
Bottled water (mln litres)
6,000
% Change
4,000
Small pack (mln litres)
2,000
Bulk (mln litres)
10,000
10,000
10,000
10,000
10,000
2015f
2016f
2017f
2018f
2019f
0 2015f
2016f
Commentary
Commentary
Commentary
2017f
2018f
2019f
27
Region A Bottled Water Value
28
Region A bottled water Market value trends 2010-14 CNY million 12,000 10,000
10,000
10,000
10,000
10,000
10,000
Bottled water value
2010
2011
2012
2013
2014
CNY million
8,000
% growth
6,000
€ million
4,000
% growth
2,000
US$ million % growth
0 2010
Commentary
Commentary
Commentary
2011
2012
2013
2014
29
Region A bottled water Average value per litre 2010-14 CNY 1.40 1.20
1.20
1.20
1.20
1.20
1.20
Average value per litre 1.00
1.00
1.00
1.00
1.00 0.80
0.75
0.75
0.75
0.75
0.75
0.60 0.40 0.20 0.00 2010
2011
Bottled water (CNY)
Commentary
Commentary
Commentary
2012 Small pack (CNY)
2010
2011
2012
2013
2014
1.00
2013
2014 Bulk (CNY)
Bottled water (CNY) Small pack (CNY) Bulk (CNY) Bottled water (€) Small pack (€) Bulk (€) Bottled water (US$) Small pack (US$) Bulk (US$)
30
Region A Key Manufacturers
31
Region A bottled water Leading manufacturers by volume 2012 & 2014 Manufacturer volume % share 2014 Manufacturer 5 20.0%
Manufacturer 1 20.0%
Volume sales (mln litres)
2012
2014
2012
2014
Manufacturer 1 Manufacturer 2 Manufacturer 3 Manufacturer 4 Manufacturer 5
Others Volume % share Manufacturer 4 20.0%
Manufacturer 2 20.0%
Manufacturer 3 20.0%
Manufacturer 1 Manufacturer 2 Manufacturer 3 Manufacturer 4 Manufacturer 5
Others The order of manufacturers is based on 2014 ranking.
Commentary
Commentary
Commentary
32
Region A Key Brands
33
Region A bottled water Leading brands by volume 2012 & 2014 Volume sales (mln litres)
Brand volume % share 2014 Brand 5 20.0%
2012
2014
2012
2014
Brand 1 Brand 2 Brand 3 Brand 4 Brand 5
Brand 1 20.0%
Others Volume % share Brand 4 20.0%
Brand 2 20.0%
Brand 3 20.0%
Brand 1 Brand 2 Brand 3 Brand 4 Brand 5 Brand 1 The order of brands is based on 2014 ranking.
Commentary
Commentary
Commentary
34
Region A Channel Distribution
35
Region A bottled water Distribution split by volume 2014 Channel volume % share 2014 2014 HOD 20.0%
Modern trade 20.0%
Million litres
Volume % share
Modern retail Traditional Discounters OOH
OOH 20.0%
Discounters 20.0%
HOD Total
Traditional stores 20.0%
Commentary
Commentary
Commentary
36
Region A Packaging
37
Region A bottled water Packaging size split by volume (litres) 2010-14 Packaging size volume % share 2014 Volume % share
>10 litres 35.0%
0-2 litres 35.0%
2010
2011
2012
2013
2014
0-2 litres >2 to 10 litres >10 litres Total
>2 to 10 litres 30.0%
Commentary
Commentary
Commentary
38
Appendix
39
Appendix Definitions Zenith’s market figures capture the total sales to end consumers through every distribution channel over the period of a full calendar year. Bottled water market volume reflects the total annual bottled water volume sales to consumers from 1st January to 31st December of a given year. Total market volume also indicates the total consumption for the same period. Value trends are also measured on the basis of value sales to end consumers and hence reflect the total expenditure by consumers through a calendar year. Bottled water market value is the total amount that consumers pay for bottled water products through all channels during 1 st January-31st December of a given year. Value per litre (vpl) measures the average price over the period of a calendar year paid for by consumers for bottled water through all channels. Bottled water: all kind of plain water (purified drinking, spring, mineral, etc.) in all packaging size formats sold to consumers. Enhanced waters and flavoured waters are excluded in the scope of this definition. Small pack (packed) water: bottled water packed in up to 10 litres pack formats. Bulk water: bottled water packed in over 10 litres formats. Modern trade: mainly organised retail, predominantly supermarkets and hypermarkets (e.g. Wal-mart, Carrefour, Tesco), but also smaller suboutlets of multiple grocers (for example, Tesco express, Sainsbury’s local). Also includes government owned stores and co-ops. Discounters: includes both hard and soft discounters (e.g. Aldi, Lidl, Penny, Netto, Plus, Denner, Dia). Discount retailers usually have basic merchandising, a limited product range and often a limited role of manufacturer brands (although this is now changing to some extent, with increasing number of discounters offering a wider range of branded goods). Every day low priced goods is the core model of discounters.
40
Appendix Definitions Traditional stores: generally smaller outlets including mom and pop stores and traditional (independent) grocers. Also includes kiosks, street stalls and sales through vending machines. Out of home (OOH): on premise and on the go consumption, through both chains (McDonald's, Shell etc.) and independent outlets. Includes HoReCa (Hotels, Restaurants and Catering). Home and office delivery (HOD): sales directly to end users through delivery service offered by producer and/or via distributors.
41
Appendix Acronyms
CAGR CNY HOD Horeca mln OOH PCC VPL
compound annual growth rate Chinese Yuan home and office delivery hotels, restaurants, catering sector million out-of-home per capita consumption value per litre
42
Zenithinternational specialist consultants to the food and drink industries worldwide Zenith’s market reviews aim to give a quick and easy understanding of food and beverage markets worldwide. For more detailed market data and analysis, or to subscribe to FREE daily industry news from Zenith International please visit our website. For a tailor made study specific to your requirements, please call Esther Renfrew on +44 (0)1225 327900. Our consulting activities are wide ranging. These include tailor made market studies, strategic advice, acquisitions and due diligence, business plans and cost modelling through to plant construction and operational efficiency, environmental audits and groundwater development. To discuss any of Zenith’s services, please telephone our head office on +44 (0)1225 327900 or visit www.zenithinternational.com.
43