Turkey Food and Drink Report Q4 2011
Business Monitor International, August 2011, Pages: 83
Business Monitor International's (BMI) Turkey Food and Drink Report (Q4 2011) provides industry professionals and strategists, corporate analysts, food and drink associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Turkey's food and drink industry.
While the long-term domestic demand credentials of the BRIC (Brazil, Russia, India and China) economies are often heralded, Turkey also has a lot going for it and may well be discussed similarly in the years to come. It has a number of factors in its favour, including a dynamic and youthful population in excess of 75mn, a strong economic outlook and a business environment and private sector mentality that are improving all the time and at some pace too.
Turkey's stock as a genuinely exciting domestic demand economy has only strengthened over the past two years, with its economy thoroughly outperforming almost all of Europe. Much of emerging Europe, which so many companies piled cash into in the years leading up to the downturn, was struck down so badly that it will probably take a number of years for many economies to recover, while Turkey has come back strongly.
Headline Industry Data
- 2011 per capita food consumption growth in local currency = 6.60%; forecast compound annual growth to 2015 = 7.10%.
- 2011 beer volume sales = 0.45%; forecast compound annual growth to 2015 = 1.20%.
- 2011 mass grocery retail sales = 11.59%; forecast compound annual growth to 2015 = 12.78%.
Key Company Trends
Diageo Buys Mey Içki - Having been careful with its cash over the past few years, Diageo has loosened its coffers and bought Turkey's leading spirits company Mey Içki for GBP1.3bn. Although not really a game changer given that Mey Içki turns over around GBP300mn a year (fairly small change in the grand scheme of Diageo's business), the deal does bring to the table some welcome emerging market (EM) exposure.
While a strong move, to really strengthen its EM business BMI believes that Diageo needs to do a lot more in Asia. The best way forward would be buying up what it does not already own in the luxury goods group LVMH's drinks business Moet Hennessy. Diageo clearly needs exposure to the cognac sector if it is to make the most of the Chinese opportunity in particular.
Coca Cola Iceçek: BMI's EM Pick - Turkey-based Coca-Cola Iceçek (CCI) could be the fastest growing major Coca-Cola franchise bottler over the next five years – just as it has been over the last five. BMI believes it to have fundamentally excellent prospects. Geographically, CCI does almost all its international business in large frontier economies, where incomes are growing quickly and alcohol is not widely consumed; while its long-term prospects in fast-growing and increasingly affluent Turkey clearly are not bad either. So this is a company that does almost all its business in emerging and frontier economies, which in the case of soft drinks, is a huge deal.
Bottled Water And Juices Important To Positive Soft Drinks View - BMI expects bottled water and juices to do particularly well in Turkey over the next few years. Turkey has some pretty strong long-term domestic demand credentials. Most of the main sectors within its food and drink industry, ranging from soft drinks sales to food retail sales, are going to grow considerably over the next few years. As incomes rise people are going to spend more on food and drink, and as the economy continues to show a lot of promise companies are going to invest heavily in output and distribution.
BIM Birlesik Magazalar Long-Term Prospects Look Excellent – BMI has been very positive in its outlook for Turkey's organised food retail industry for some time now. The country has a young and vibrant population of about 75mn that is getting richer very quickly, which will almost certainly be extremely retail positive on a number of levels.
Fundamentally, rising incomes will allow a much greater proportion of the population to regularly shop at organised stores. Given that informal independent stores still account for the majority of food sales, the trade up to organised food retailing forms the backbone of BMI's long-term view on Turkish retail. The acceleration of this fundamental transition will be especially good for soft discount retailing in BMI's opinion. Turkey getting richer will of course certainly also be good for the more expensive supermarkets where BMI expect a lot of new retail space to spring up to cater to growing footfall.
BMI Industry View
SWOT Analysis
Turkey Food Industry SWOT
Turkey Drink Industry SWOT
Turkey Mass Grocery Retail Industry SWOT
Business Environment
BMI's Core Global Industry Views
BMI Core Views
CEE Food & Drink Business Environment Overview
Table: Emerging Europe Food & Drink Risk/Reward Ratings Q411 - Published July 2011
Turkey's Food And Drink Business Environment Ratings
Macroeconomic Outlook
Table: Turkey - Economic Activity
Industry Forecast Scenario
Consumer Outlook
Food
Total Food Consumption
Table: Food Consumption Indicators – Historical Data & Forecasts
Table: Frozen fruit & vegetables
Table: Dairy and vegetable
Confectionery
Table: Value/Volume Sales of Selected Food Sub-sectors –Historical Data & Forecasts Drink
Beer
Table: Turkey Beer Sales –Historical Data & Forecasts
Soft Drinks
Table: Turkey Soft Drink Sales – Historical Data & Forecasts
Hot Drinks
Table: Tea Value Sales – Historical Data & Forecasts
Mass Grocery Retail
Table: Turkey Mass Grocery Retail Sales by Format – Historical Data & Forecasts
Trade
Table: Sectoral Trade Indicators
Food
Key Industry Trends And Developments Companies Raising Capital For Expansion
Multinational Interest Growing
Market Overview
Food Production
Dairy
Agriculture
Halal Food
Drink
Key Industry Trends And Developments
Coca Cola Iceçek Our EM Pick
Diageo Buys Mey Içki For GBP1.3bn
Excise Surge Tempers Beer View
Bottled Water And Juices Important To Positive Soft Drinks View
Market Overview
Alcoholic Drinks
Soft Drinks
Table: Soft Drinks Sales Breakdown In Turkey
Hot Drinks
Mass Grocery Retail
Key Industry Trends And Developments
BIM Birlesik Magazalar Long-Term Prospects Look Excellent
Duty Free Capitalising On Turkish Airlines Boom, Just Like In The Gulf
Market Overview
Table: Structure Of Turkey's Mass Grocery Retail Market – Sales Value By Format (TRYbn)
Table: Structure Of Turkey's Mass Grocery Retail Market – Sales Value By Format (US$bn)
Competitive Landscape
Consumer Share Price Analysis
Table: Food and Drink Key Players
Table: Key Players in Turkey's Mass Grocery Retail Sector (2009)
Company Monitor
Food
Ülker Group
Nestlé Turkey
Sabanci Holding
Drink
Anadolu Efes
Coca-Cola Içecek (CCI)
Mass Grocery Retail
Migros Turk
BIM
Tesco Kipa
BMI Methodology
Food & Drink Business Environment Ratings
Table: Returns
Table: Risks
Weighting
Weighting
Table: Weightings
BMI Food And Drink Industry Glossary
Mass Grocery Retail
BMI Food And Drink Forecasting And Sourcing
How We Generate Our Industry Forecasts
Sourcing
- Ülker Group
- Nestlé Turkey
- Sabanci Holding
- Anadolu Efes
- Coca-Cola Içecek (CCI)
- Migros Turk
- BIM
- Tesco Kipa
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