THE 2010 UK SOFT DRINKS REPORT

INVESTING IN REFRESHMENT
 SOFT DRINKS – INVESTING IN REFRESHMENT
REPORT METHODOLOGY/BACKGROUND

Specialist food and drink consultancy, Zenith commissioned to produce

enith International, has been commissione
this 2010 BSDA UK Soft Drinks Report. All data and insights contained in this report were
produced using Zenith’s internal market databases and primary research.

In compiling its research, Zenith relies on the
goodwill and cooperation of companies active
in the marketplace. During Zenith’s annual
research into the UK soft drinks industry,
over 250 soft drinks producers are regularly
contacted. This includes larger branded
operators, retailer own label specialists, contract
packers and a significant number of smaller
independent companies.
Based on individual producer volumes for the
year, market, sector and segment totals are
calculated from the ‘bottom up’. At a sector and
segment level, adjustments are then made for
any double counting of contract and licensed
bottling. Estimates for unauthorised soft drink
imports sold through the ‘grey market’ are also
included. This is more pronounced in categories
such as energy drinks rather than dilute to taste
drinks, for example.
A complete picture of the UK soft drinks market
across all sales channels is produced, through
Zenith’s extensive study of the largest soft
drinks companies, alongside small to medium
sized operators and own label specialists. The
market figures presented therefore encompass
all aspects of the market including: take home,
impulse and on premise; water cooler volumes
for the office; home dispense carbonated soft
drinks; and pump dispense carbonates in the
licensed trade.
To this end, a considerable amount of time and
effort is spent contacting industry players and
striving to analyse the complexities of the UK
soft drinks arena. Zenith would like to express
its sincere gratitude to BSDA and the entire UK
soft drinks industry for its continued help and
support during the research process.

2 • The 2010 UK Soft Drinks Report

THE UK 2010 SOFT DRINKS REPORT
INVESTING IN REFRESHMENT

CONTENTS 4 OVERALL SOFT DRINKS CONSUMPTION

6 BOTTLED WATER

8 CARBONATES

10 DILUTABLES

12 FRUIT JUICE AND SMOOTHIES

14 STILL AND JUICE DRINKS

16 SPORTS AND ENERGY DRINKS

18 OUTLOOK AND CONCLUSIONS

19 ABOUT BSDA

Investing in refreshment:
The people behind People The logistics manager page 6
the product Profiles: The brand manager page 8

The category manager page 10

The general manager page 12

The education
centre manager page 14

The engineers page 16

The director
general page 5

The 2010 UK Soft Drinks Report • 3

 OVERALL UK soft drinks consumption, 2003 - 2009
Year 2003 2004 2005 2006 2007 2008 2009

SOFT DRINKS
Million litres 13845 13600 13720 14175 14060 13905 14140
% change +6.8 -1.8 +0.9 +3.3 -0.8 -1.1 +1.7
Litres per person 231.5 226.3 227.1 233.4 230.3 226.5 229.1
Value, £ million 12130 12145 12415 12830 12892 12936 13224

CONSUMPTION % change
Value per litre, £
+8.1
0.88
+0.1
0.89
+2.2
0.90
+3.3
0.91
+0.5
0.92
+0.3
0.93
+2.2
0.94

Source: Zenith International

£13.224 billion
VALUE OF UK SOFT DRINKS INDUSTRY
IN 2009. UP 2.2% ON PREVIOUS YEAR

UK soft drinks sectors annual percentage change, 2003 - 2009

20
Bottled water

15
Carbonates

10
Dilutables

5 Fruit juice

Still & juice drinks

ks
0

Total
-5

-10
2003 2004 2005 2006 2007 2008 2009

Source: Zenith International

4 • The 2010 UK Soft Drinks Report

 People
Profile:
UK soft drinks consumption, 2003 - 2009
000 million litres
15

12

0
2003 2004 2005 2006 2007 2008 2009
THE DIRECTOR
Source: Zenith International
GENERAL
The soft drinks industry has had
UK soft drinks, low UK soft drinks some disappointing years lately,
calorie & no added sectors, 2009 but 2009 saw overall consumption
sugar vs regular, 2009 return to growth once more. Our
2010 UK Soft Drinks Report tells
the story of how the industry did
this; it also tells the story of the
people in the industry who made
it happen.
The industry’s success is based on
serving the demanding,
Low calorie 61% Carbonates 43% price-conscious consumer.
Regular 39% Dilutables 24% If the public wants value for money,
we have to deliver value. If the
Bottled water 15%
public is concerned about health
Fruit juice 9% and wellbeing, we have to offer a
Still & juice drinks 10% choice of drinks that meets their
needs. If the public is thinking
Source: Zenith International Source: Zenith International
about sustainability, we have to
show how our environmental impact
is being reduced.
And of course, we have to be ready
to meet our consumers’ needs
before the consumers themselves
200
2009 0 was a year of trials and economic turmoil and low consumer confidence, even have them. We have to
tribulations.
tribbu The UK economy continued promotional activity helped the industry recover think ahead.
to b be deeply impacted by recession, some lost ground.
Our industry’s success is based on
the e worst for decades. Meanwhile, the its plans for the future, investing in
Bottled water re-engaged with the consumer, with
‘barbecue
‘baar summer’, originally forecast promotions a major theme. Carbonates showed new products, new ways of working
by
by tthe Met Office, failed to deliver a a resurgence, providing an affordable treat in and in the skills of its people. In
meteoric surge for the industry. Yet,
me
m tough times. Dilutables consumption was boosted more ways than one, the soft drinks
despite
d these challenges, soft drinks by double concentrated variants increasing in industry plays a role in the life of
registered
r an impressive 1.7% popularity. The worst performing category was the nation.
growth
g in volume and 2.2% gain in pure juice and smoothies, which faced a battle
value to stand at 14140 million litres
vva with reduced disposable income. Still and juice Jill Ardagh
and d £13.224 billion respectively. drinks remained in favour for their easy drinking. Director general :
Sports and energy drinks continued their strong British Soft Drinks Association
200
2009
0 could best be summarised as a year of growth path in 2009, albeit at a lower rate than
‘softt rebound’. On the back of two poor summers, in previous years.
Mayy to July 2009 saw average sunshine
levels
leve
el consistently higher than previous years; 2009 showed that consumers have remained loyal
and August 2009 was notably brighter than to the soft drinks category but are more concerned
DEFINITION: soft drinks
August
Auggu 2008. than ever with value. Issues such as health,
wellbeing and naturalness continue to overlap
Carbonated drinks, still and dilutable
So, while heat wave conditions remain more with pleasure and indulgence in consumers’
drinks, fruit juices, smoothies and
of a distant memory, 2009 delivered a few minds, leaving the soft drinks market awash
bottled waters, including sports and
rayss of sunshine. Coupled with this, amidst with opportunity.
energy drinks.

The 2010 UK Soft Drinks Report • 5

 BOTTLED UK bottled water consumption, 2003 - 2009
Year 2003 2004 2005 2006 2007 2008 2009

WATER
Million litres 2070 2060 2150 2275 2175 2055 2090
% change +17.6 -0.5 +4.4 +5.8 -4.4 -5.5 +1.7
Litres per person 34.6 34.3 35.6 37.5 35.6 33.5 33.9
% of all soft drinks 15.0 15.1 15.7 16.0 15.5 14.8 14.8
Value, £ million 1405 1435 1535 1650 1557 1418 1404
% change +19.1 +2.1 +7.0 +7.5 -5.6 -8.9 -1.0
Value per litre, £ 0.68 0.70 0.71 0.73 0.72 0.69 0.67
Source: Zenith International

1.7%
WATER SALES
INCREASE BY
VOLUME SINCE 2008

In 2009, the bottled water category

saw a return to growth, albeit with
overall volumes still below those of THE LOGISTICS
MANAGER
2005. Volume sales increased by 1.7%
to 2090 million litres, whilst value
declined by 1% to £1404 million. Plain
unflavoured bottled water’s share of I am in charge of a small team that looks
the total soft drinks market remained after the warehousing and transport of
unchanged from 2008 at 14.8%. Danone Waters from our bottling locations
through three distribution sites to the final
Unfortunately the ‘barbecue summer’ predicted customer. Transportation and warehousing
by the Met Office did not materialise. Yet in key is undertaken by specialist contractors, so
consumption months, such as August, consumers my role is to manage our relationships with
once again turned to bottled water during spells those companies: I don’t actually drive a
of sunshine. Meanwhile, a number of companies truck myself!
ran deep promotions – further striking a chord
My responsibilities include making sure that
with consumers. On-the-go outlets and major
the right product gets through to the right
retail saw a strengthening, particularly in the
customer at the right time, keeping costs
second half of the year, while the on-trade
and waste to the minimum. For example,
channel was held back amidst economic woes.
we have to manage the stock rotation
Consumption of water in smaller retail pack to minimise the amount that has to be
sizes (of 10 litres and below) increased by destroyed because it reaches its use by date
4.7% to 1775 million litres as opposed to water before being sold.
coolers, which witnessed a 12.5% decline. Under In addition to this, I also champion the
these circumstances and following two years measurement and reduction of the carbon
of declining consumption, the growth shown footprint of our business. This extra
by the bottled water category is all the more role is formally only a part of my overall
impressive and shows that there is further room responsibilities, but in practice it extends into
for improvement. all of them. When you think about it, that is
how it should be. These days, improving our
environmental performance and improving
our business performance go hand in hand,
and we have to think in those terms.

6 • The 2010 UK Soft Drinks Report

 UK bottled water consumption, 2003 - 2009
Million litres
2500

2000

1500

1000

500

0
2003 2004 2005 2006 2007 2008 2009
Source: Zenith International

UK bottled water UK bottled water UK bottled water UK bottled water

categories, 2009 types, 2009 packaging, 2009 origins, 2009

Still bottled 72% Natural mineral water 61% Plastic 93% UK produced 78%
Sparkling bottled 13% Spring water 27% Glass / other 7% France 17%
Still water cooler 15% Bottled drinking water 11% Others 5%

Source: Zenith International Source: Zenith International Source: Zenith International Source: Zenith International

People Profile:
I have to the railways and off the roads. We come
ffound o that up against limits in rail capacity, but we are
iitt doesn’t working with the rail companies to see what
ttake a a more we can do.
llot o of We are also working with our third party
ccomplicated contractors to help them reduce their carbon
ttechnology
e footprint. At first, it might have seemed to
ttoo get some of them like a burden – it takes time
sstarted: just and effort and no company has got staff
a willingness
will
illiingness to measure ca
carefully
reffully
ll and find with spare time to devote to new things, but
out where the biggest environmental impacts they are seeing the benefits now and even
are. Then you can work on reducing them. getting excited about it.
We have the benefit of substantial in-house Knowledge and awareness on environmental
DEFINITION: Bottled water
expertise but we also drew on some external issues are continually changing. Nobody
advice in order to draw up our first map should stop to pat themselves on the back Still, sparkling water and lightly
of our carbon footprint. I work with my and think they have done enough, because carbonated water; natural mineral
colleagues in other European countries to there is always more that can water, spring water, bottled drinking
share ideas and learn from each other, and I be done. water; packaged water in sizes
can then bring some of those ideas home for
of 10 litres and below; water for
implementation here.
coolers in sizes of 10.1 litres
A good example of what we are trying to do and above.
Rebecca Williams
more of is to move more of our transport on
Physical Logistics Manager :
Danone Waters

The 2010 UK Soft Drinks Report • 7

 CARBONATES UK carbonates consumption, 2003 - 2009
Year 2003 2004 2005 2006 2007 2008 2009
Million litres 6525 6195 6065 5915 5835 5935 6065
% change +4.6 -5.1 -2.1 -2.5 -1.4 +1.7 +2.2
Litres per person 109.1 103.1 100.4 97.4 95.6 96.7 98.3
% of all soft drinks 47.1 45.6 44.2 41.7 41.5 42.7 42.9
Value, £ million 7060 6930 6850 6800 6880 7140 7470
% change +5.8 -1.8 -1.2 -0.7 +1.2 +3.8 +4.6
Value per litre, £ 1.08 1.12 1.13 1.15 1.18 1.20 1.23

43%:
Source: Zenith International

CARBONATES SHARE
OF THE SOFT
DRINKS MARKET

The largest of the soft drinks sectors,

carbonates, edged ahead of the market
average despite the ongoing economic THE BRAND
MANAGER
downturn. Consumption rose 2.2% to
6065 million litres while retail value
performed even better, growing by
4.6% to £7470 million. I’m responsible for the management of the
Vimto brand in the UK, from developing
Cola remained the most popular variant – further
marketing strategy and plans that help to
strengthening its position at the expense of
grow the brand, through to implementing
lemonade, mixers and fruit flavoured carbonates.
those plans.
Brands outperformed private label on the back
I’m the guardian of the brand and therefore
of promotional activity and as private label
look after all our communication that is
carbonates fell out of taste with consumers.
consumer facing. This can include everything
With a consistent and recognisable taste profile,
from advertising, (whether on TV, radio,
branded carbonates offered an inexpensive treat
press or online) through to packaging,
to cash-strapped consumers.
promotions, new product development and
Diet colas performed better than regular variants, PR. It’s a really varied and exciting job and
delivering consumers choice whether on the no two days are ever the same.
move or at leisure. Low and zero sugar carbonates We have just launched a cherry-flavoured
have paved the way forward in recent years extension to our brand. The product was
– supported by a blend of industry ‘push’ and developed on the back of extensive research
consumer ‘pull’. Overall, carbonates continued to that identified a huge opportunity and an
defy the prevailing economic conditions – further overwhelming positive response to our
confirming the British consumers’ taste for fizz. new recipe. It’s been on the market since
January and sales are already exceeding our
expectations.
As part of every new product development
project we undertake, we always seek
to minimise packaging waste as much
as possible. This can include a range of
measures, from reducing the weight of

8 • The 2010 UK Soft Drinks Report

 UK carbonates consumption, 2003 - 2009
DEFINITION: Carbonates
Million litres
8000
Ready to drink including draught
7000 dispense; home dispense; regular
including sparkling juice; low calorie
6000 and zero calorie; cola; lemon
including lemonade; lemon-lime;
5000
mixers including tonic and bitter
4000 drinks; orange; shandy; others
including other carbonated fruit
3000 flavours, energy drinks, sparkling
flavoured water, health drinks and
2000
herbal drinks.

1000

0
2003 2004 2005 2006 2007 2008 2009
Source: Zenith International

UK carbonates regular UK carbonates UK carbonates

vs low calorie, 2009 flavours, 2009 packaging, 2009

Regular 63% Cola 53% PET 57%

Low calorie 37% Fruit 14% Can 26%
Lemonade 14% Dispense 11%
Energy 6% Glass 3%
Other 13% Other 3%

Source: Zenith International Source: Zenith International Source: Zenith International

People Profile:
our
o PET through our R&D team and manufacturing
bottles
b or partners, maintain up to date information on
using
u part new ingredients coming to the market to
recycled
re help us continually improve our products.
PET,
P to I don’t only have to think about new
eliminating
e products but also new technologies. The
the
th proliferation of media and the rise in use
need
n for of digital technologies makes it easier and
cardboard
c more efficient to identify and engage target
outer trays
trays. OOur
ur pou
pouch
ch
h pack
pack,
k whic
which
h we audiences for marketing, but the new media
launched in 2009, is a perfect example of hasn’t replaced the traditional media just
this. It is recyclable, uses less packaging yet. I therefore still need to use a mix of
material and is lightweight (thus reducing media to reach audiences effectively for
transport costs and carbon footprint). marketing and to provide information.
Understanding consumers and their needs
is central to what we do as it enables us
to develop the right products. Therefore
we use a variety of research techniques to
check our consumers’ attitudes to health
and diet. We offer a range of Vimto products
to meet our customers’ needs, including
lower and no added sugar alternatives. And, Emma Hunt
Brand Manager : Vimto

The 2010 UK Soft Drinks Report • 9

 DILUTABLES UK dilutables consumption, 2003 - 2009
Year 2003 2004 2005 2006 2007 2008 2009
Million litres 3175 3125 3100 3350 3350 3250 3350
% change +4.1 -1.6 -0.8 +8.1 - -3.0 +3.1
Litres per person 53.1 52.0 51.3 55.2 54.9 52.9 54.3
% of all soft drinks 22.9 23.0 22.6 23.6 23.8 23.4 23.7
Value, £ million 790 780 775 805 805 795 850
% change +3.9 -1.3 -0.6 +3.9 - -1.2 +6.9
Value per litre, £ 0.25 0.25 0.25 0.24 0.24 0.24 0.25
Source: Zenith International

54.3
Dilutable litres per
person drunk in UK
in 2009

Consumption of dilute to taste drinks

bounced back to 2007 levels with
consumed volume increasing by 3.1% THE CATEGORY
MANAGER
to 3350 million litres in 2009. The
retail value enjoyed higher growth of
6.9% to reach £850 million. Dilutables
retained their second place position in My role as a Britvic category manager
is to work with one of Britain’s leading
the UK by volume consumed,
supermarkets to help them manage their
remaining steady on 23.7% of the soft
soft drinks portfolio. I work with them to
drink market. ensure that soft drinks (wherever the shopper
encounters the category) have the best and
In a sector familiar with reinvigoration and
most relevant offering.
rebranding, the wider introduction of double
concentrate dilutables, typically mixed nine parts We base this on detailed research into how
shoppers behave and what they want in
water to one part squash, as opposed to four
store – it’s not just an aesthetic exercise. This
parts water to one part squash, has been the
can inform many aspects of our relationship
most notable development. This added even more
with our retailers: from high-level contact to
affordability to an already popular drink of choice
drive category growth strategically through
for value conscious consumers.
to working in our retailer’s merchandising
centres, where we have essentially a mock-
Demand for new and ever more elaborate flavours
up shop with practice shelves where we can
has caused blends to increase their share of the
experiment with different formats and layouts
dilutables market slightly. Favoured by adults and
to see what works. What you see when you go
children alike, low and no added sugar dilutables
into a supermarket doesn’t arise by accident –
reached 70% of the sector delivering a low calorie there’s a lot of careful planning behind it.
refreshment on tap. In a sustained economic
We’re not the only soft drinks company to
downturn, dilutables remain concentrated in the
work like this – a number of the others also
hearts and minds of UK consumers.
have category management teams and there
is a strong commercial rivalry between us
all. We want to be the best strategic partner
for the supermarkets providing the best and
most executable advice on anything to do
with soft drinks. This might be answering
detailed questions about long-term strategies

10 • The 2010 UK Soft Drinks Report

 UK dilutables consumption, 2003 - 2009 DEFINITION: Dilutables
Million litres
3500 Squashes, cordials, powders and
other concentrates for dilution to
3000
taste by consumers, normally adding
4 parts water to 1 part product;
2500
high juice (minimum 40% fruit
content as sold); regular including
2000
squashes and cordials (minimum
25%); low sugar including no added
1500
sugar and sugar free; (dilutables are
expressed as ready to drink for ease
1000
of comparison where measuring

500 overall soft drinks market

figures/shares).
0
2003 2004 2005 2006 2007 2008 2009
Source: Zenith International

UK dilutables regular vs UK dilutables UK dilutables

low calorie, 2009 flavours, 2009 packaging, 2009

Low sugar / NAS 70% Blends 51% Plastic up to 1 litre 56%

Regular 23% Orange 29% Plastic over 1 litre 35%
High juice 7% Blackcurrant 11% Others 9%
Lemon 5%

Lime 2%
Others 2%
Source: Zenith International Source: Zenith International Source: Zenith International

People Profile:
a market
and to ensure that parents are able to make the
tr
trends or right decisions on behalf of their children.
finding out We have a qualified nutritionist working with
si
simple facts us to ensure that everything we do and say
th the
that is scientifically correct. Helping parents and
s
supermarket teaching kids about the importance of a
w
wants to balanced diet is absolutely crucial.
k
know. We want to make it easy for parents to make
W benefits
Who decisions, and make the right decisions, on
fr
from all this? behalf of their children. Part of that is
Thh shopper.
The shopp
sh
hopper
er W ew
We antt to
want to ma
mak
ke it
ke
make it easy for making the shopping experience a bit more
people to find the things they want in store, fun for the kids, too – that way, parents can
which means stocking the right products, find it a bit easier to make the right choices
arranging them so that people can easily rather than being rushed into something
find what they are looking for and promoting without being able to think about it properly.
them in the optimal way. That’s why we need The soft drinks industry is one of the fastest
the research, to give us the best possible moving parts of the FMCG sector, with new
knowledge of the marketplace and consumer products and new ideas coming along all the
trends. That way, we can help stores meet time. That means we’ve got to keep up with
shoppers’ needs better. new research and new advice for our partners
One recent project has been to rethink the in the supermarkets. I suppose if there’s a
stocking and presentation of drinks for phrase that sums up category management,
children. Obviously, this is an area which its “inspiring shoppers by adapting to their
needs particular care because we have got ever-changing needs”.

Chris Stokes
Category Manager : Britvic
The 2010 UK Soft Drinks Report • 11
 FRUIT JUICE UK fruit juice consumption, 2003 - 2009
Year 2003 2004 2005 2006 2007 2008 2009

& SMOOTHIES
Million litres 1090 1130 1215 1305 1330 1285 1245
% change +6.3 +3.7 +7.5 +7.4 +1.9 -3.4 -3.1
Litres per person 18.2 18.8 20.1 21.5 21.8 20.9 20.1
% of all soft drinks 7.9 8.3 8.9 9.2 9.5 9.2 8.8
Value, £ million 1660 1675 1815 1960 1980 1900 1815
% change +9.4 +0.9 +8.4 +8.0 +1.0 -4.0 -4.5
Value per litre, £ 1.52 1.48 1.49 1.50 1.49 1.48 1.46
Source: Zenith International

UK smoothies consumption, 2003 - 2009

Year 2003 2004 2005 2006 2007 2008 2009
Million litres 19 22 33 52 75 60 40
% change +11.8 +15.8 +50.0 +57.6 +44.2 -20.0 -34.2
Litres per person 0.3 0.4 0.5 0.9 1.2 0.9 0.6
% of all soft drinks 0.1 0.2 0.2 0.4 0.5 0.4 0.3

Source: Zenith International

8.8%
FRUIT JUICES AS % OF
TOTAL SOFT DRINKS

The fruit juice category was the worst

performing sector of all soft drinks in
2009, witnessing a 3.1% fall in volume THE GENERAL
MANAGER
to 1245 million litres coupled with a
4.5% drop in retail value to
£1815 million.
My role as General Manager at Pepsi is to
Worst affected were premium products, with
set a strategy and guide the business for
consumers trading down to cheaper alternatives.
the long-term. For example, we have just
This led to strong growth of not from concentrate
launched, alongside our parent company
(NFC) ambient juice, albeit from a small base and
PepsiCo UK, a ten-year vision for future
at the expense of chilled NFC offerings. In a similar
business growth and profitability to come
vein, branded juices suffered more than own
from healthier products. As part of this, we
label. Smoothies, meanwhile, had a rough ride in
have committed to encouraging consumers
2009 with sector volume suffering a double digit
to opt for healthier choices, with the goal
decline against the economic backdrop.
that by 2015, 65% of our can and bottle
Apple juice and grapefruit juice experienced sales will come from no-sugar drinks.
small increases in their market share Central to achieving this goal, together with
but orange remains the dominant fruit our bottling partner, we recently launched
as both a single flavour and as part of the UK’s first single-serve 600ml bottle
blended choices. across our no-sugar range. Regular drinks
remain in the standard 500ml bottles. To
Health awareness and ongoing give consumers further incentive to opt for
5-a-day messages should support no-sugar drinks, we’ve set the RRP for the
pure juice and smoothies in the future. 600ml bottle at the same level as the 500ml
As consumers feel more secure with format, meaning that our no-sugar range
the money in their pockets, a falling offers even greater value.
trend should be reversed.
Not only do we believe that the new strategy
will play a role in helping encouraging
consumers transition to healthier options,
we also believe that the new format will
play a role in unlocking the potential of the
on-the-go market. The launch of the 600ml

12 • The 2010 UK Soft Drinks Report

 UK fruit juice consumption, 2003 - 2009
Million litres DEFINITION: Fruit juice
1500
100% fruit content equivalent,
sometimes referred to as pure
1200 juice or 100% juice. Chilled
juice comprises four main types:
smoothies (based predominately on
900 whole crushed fruit, chilled and with
a short shelf life); freshly squeezed
juice (not pasteurised, chilled with
600
a shelf life of a few days); not from
concentrate juice (squeezed then
300 pasteurised, chilled with a shelf
life of a few weeks); other chilled
from concentrate (from concentrate
0 or part squeezed and part from
2003 2004 2005 2006 2007 2008 2009
concentrate). Ambient or long life
Source: Zenith International
juice is mainly from concentrate
UK ambient vs chilled UK fruit juice UK fruit juice and heat treated; shelf life of up to
fruit juice, 2009 flavours, 2009 packaging, 2009 18 months.

Ambient 45% Orange 55% Carton 77%

Chilled not from concentrate 25% Apple 14% Plastic 16%
Chilled from concentrate 23% Blends 18% Glass / other 7%
Chilled freshly squeezed 3% Pineapple 4%

Chilled smoothies 4% Grapefruit 2%

Others 7%

Source: Zenith International Source: Zenith International Source: Zenith International

People Profile:
fformat
o is developing a natural variant of our cola,
tthe
h biggest and acquiring a functional water brand.
ppack Our focus on health is a central factor in
iinnovation
n how we run the business. Because we
iin
n fifteen believe we have a role to play in
yyears. In encouraging consumers to make healthier
tthe
h current choices, we only advertise our no-sugar and
eeconomic natural ingredients colas.
cclimate,
We’re also committed to working with
wit
with
i h consumers d demanding
emandi
ding greate
greater value,
Government partners to promote healthier
we’re confident that the new format
lifestyles. We recently engaged our brand
will succeed in re-energising the
ambassadors, Frank Lampard and Thierry
on-the-go category.
Henry, to front a Change4Life campaign,
Amidst rising public concerns about health encouraging parents to get out with their
and nutrition, I believe that companies like children and enjoy active play.
Pepsi have a duty to respond and lead
As one of the world’s most famous drinks
change in the marketplace. We’re addressing
companies, we have a responsibility to live
today’s public health issues by refocusing
up to the name. We have a platform to show
our portfolio on healthier products. We’ve
that soft drinks companies can play a part in
done this by building strong no-sugar cola
addressing today’s public health issues.
brands, reformulating our leading sports
drink to be free from artificial ingredients,
Garrett Quigley
General Manager :
Pepsi UK & Ireland
The 2010 UK Soft Drinks Report • 13
 STILL & JUICE UK still and juice drinks consumption, 2003 - 2009
Year 2003 2004 2005 2006 2007 2008 2009

DRINKS
Million litres 985 1090 1190 1330 1370 1380 1390
% change +11.3 +10.7 +9.2 +11.8 +3.0 +0.7 +0.7
Litres per person 16.5 18.1 19.7 21.9 22.4 22.5 22.6
% of all soft drinks 7.1 8.0 8.7 9.4 9.7 9.9 9.9
Value, £ million 1215 1325 1440 1615 1670 1684 1685
% change +11.5 +9.1 +8.7 +12.2 +3.4 +0.8 +0.1
Value per litre, £ 1.23 1.22 1.21 1.21 1.22 1.22 1.21
Source: Zenith International

42%
6 YEAR INCREASE
IN SALES OF STILL
& JUICE DRINKS

Despite continued economic

uncertainty across the country, still
and juice drinks experienced growth in THE EDUCATION
CENTRE MANAGER
volume sales, up 0.7% to 1390 million
litres, and retail value, up 0.1% to
£1685 million.
I work as an Education Centre Manager for
In line with other sectors, low calorie options
Coca-Cola Enterprises Ltd and am based
continued to increase their share at the expense
at our operations in North London where
of regular variants. From 1 litre chilled juice drinks
we host about 225 visits each year from
in retail, to still flavoured water, sports drinks and
secondary schools, colleges and universities.
other niche offerings, still and juice drinks tapped
As well as a tour of our factory, visiting
into a consumer desire for healthier alternatives.
students enjoy activities and a presentation
Cartons moved ever closer to taking half of the that is tailored to support the curriculum. All
total category share, as consumers reached out kinds of academic courses find an interest
to stay-at-home options rather than going out to in what goes on here, including engineering,
pubs and restaurants. This effectively put a dent design and technology, and business studies.
in sales of glass and other packaging types. As a qualified teacher myself, I have a
good understanding of how work-based
Still and juice drinks continue to offer a perceived programmes can bring subjects to life and,
healthier option, deliver flavour variety and benefit typically, I will work with teachers to make
from continual innovation, with products aimed at the experience as worthwhile for their
specific segments and consumption occasions. students as possible.
From regular refreshment, to fun and functionality
In addition we run our Real Business
– the category performed strongly in the wake of
Challenge as a competition between schools
the credit crunch.
that gets students to think about business
issues in an engaged and active way. We
hold regional finals where each student team
is allocated a business mentor, and people
from sales, marketing and operations all
get involved in helping. In this way we are
engaging our employees as well as showing

14 • The 2010 UK Soft Drinks Report

 UK still and juice drinks consumption, 2003 - 2009
Million litres DEFINITION: Still & juice drinks
1500
Nectars (25-99% fruit content); juice
drinks (5-25% fruit content); other
1200 still drinks (0-5%) including iced tea,
sports drinks, still flavoured water
and non-fruit drinks.
900

600

300

0
2003 2004 2005 2006 2007 2008 2009
Source: Zenith International

UK still and juice UK still and juice drink UK still and juice drink
drinks regular vs low categories, 2009 packaging, 2009
calorie, 2009

Regular 57% Stills / juice drinks 63% Carton 49%

Low calorie 43% Nectars 13% Plastic 25%
Still flavoured water 14% Glass / other 27%
Water 10%

Source: Zenith International Source: Zenith International Source: Zenith International

People Profile:
students
s issues to life, but a visit to our factory
a bit more demonstrates what can be done in a really
about
a what vivid way. For instance, students learn
working
w life about how we have reduced our water
is
is really like. and energy usage and about our waste
Of
O course, management programme as well as
everyone
e initiatives such as the Recycle Zones we are
has
h heard of setting up across the country. Improving
our
o company our environmental performance is an
before they take part in one of our integral part of what our company stands
educational programmes, and often they for, and it is good to be able to show to
have preconceived ideas about what we students what this means in practice.
do and what we are like, so it is really Our investment in educational initiatives
important that we can open our doors so improves the visibility of our operations
that they can see for themselves. We’re not and, in doing so, helps build trust in our
secretive – we’re really proud of what we business and its products. Internally,
are doing and what we have achieved. educational initiatives can provide a useful
For example, a big part of what we have platform for employee engagement and,
to do is to show how a manufacturing hopefully, there is a broader benefit to the
industry like ours can reduce the amount economy as the initiatives help to increase
of resources it uses. Sometimes teachers employability and outcomes in learners.
say they find it hard to bring environmental
Bill Muirhead
Education Centre Manager :
Coca-Cola Enterprises Ltd
The 2010 UK Soft Drinks Report • 15
 SPORTS & UK sports and energy drinks consumption, 2003 - 2009
Year 2003 2004 2005 2006 2007 2008 2009

ENERGY
Million litres 275 320 365 405 455 505 530
% change +17.0 +16.4 +14.1 +11.0 +12.3 +11.0 +5.0
Litres per person 4.6 5.3 6.0 6.7 7.5 8.2 8.6
% of all soft drinks 2.0 2.4 2.7 2.9 3.2 3.6 3.8

DRINKS Sports drinks, million litres 75

% change +36.4
85
+13.3
95
+11.8
110
+15.8
125
+13.6
135
+8.0
140
+3.7
Litres per person 1.3 1.4 1.6 1.8 2.0 2.2 2.3
% of all soft drinks 0.5 0.6 0.7 0.8 0.9 1.0 1.0

Energy drinks, million litres 200 235 270 295 330 370 390
% change +11.1 +17.5 +14.9 +9.3 +11.9 +12.1 +5.4
Litres per person 3.3 3.9 4.5 4.9 5.4 6.0 6.3
% of all soft drinks 1.4 1.7 2.0 2.1 2.3 2.7 2.8
Source: Zenith International

390
MILLION LITRES OF
ENERGY DRINKS
SOLD IN 2009

Sports and energy drinks continued to

show growth in 2009, although at a
slower rate than in previous years. The THE
ENGINEERS
combined category raced ahead by 5%
in volume to reach 530 million litres.
This represents 8.6 litres per person,
up from 8.2 litres in 2008. We are both trainees at A G Barr’s
Cumbernauld factory, and are just
Sports drinks – comprised of isotonic, hypotonic
about to enter into the final year of our
and hypertonic drinks – and energy with glucose
apprenticeships sponsored by the British Soft
and stimulant drink variants – saw their respective
Drinks Industry Foundation. (The BSDIF
segment shares remain practically unchanged
is an independent charity which supports
in 2009.
education and learning within the food and
drink industry.)
Sports drinks are targeted at an array of sporting
and outdoor pursuits – replenishing the ‘weekend We work at the heart of the manufacturing
warrior’ through to the casual gym-goer. Energy process, supporting our line engineers
drinks, which represent 74% of the combined and ensuring that the machines are kept
sports and energy category, continued to flex in operation.
their muscle in 2009. We are responsible for fault-finding,
diagnosing, repairing, maintaining and
Offering a solo or social pick-me-up, energy drinks bringing back into service equipment that is
helped keep consumers alert whilst studying or used for producing our carbonated drinks.
behind the wheel and provided a sales boost We have PET, glass and can lines. Our aim
across the UK’s pubs and clubs. Energy shots, is to minimise the amount of downtime to
delivering a concentrated energy dose, usually maximise production efficiency.
packaged in 50ml bottles, also proved successful
During 2010, we will be investing in new
in 2009.
plant and equipment, with new machines
Increasingly for everyday use, for a wide range being introduced into our workplace to
of consumers and occasions, sports and energy increase efficiencies and boost output. We
drinks have forged a defined role. From energy have to learn about this new kit to ensure it
shots, to brands targeting specific sports – this is operates at peak efficiency. This is how the
a heartland area of innovation that is set to keep company can keep pace with technological
the pulse racing in the years ahead.

16 • The 2010 UK Soft Drinks Report

 UK sports and energy drinks consumption, 2003 - 2009
Million litres DEFINITION: Sports drinks
600
Drinks that enhance physical
performance before, during or after
500
physical/sporting activity. Sports
drinks replace fluids and electrolytes/
400 minerals lost by sweating and supply
a boost of carbohydrate: isotonic
300 (fluid, electrolytes and 6 to 8%
carbohydrate), hypotonic (fluids,
electrolytes and a low level of
200
carbohydrate) and hypertonic (high
level of carbohydrate).
100

DEFINITION: Energy drinks

0
2003 2004 2005 2006 2007 2008 2009
Source: Zenith International Traditional glucose based energy
drinks; functional or stimulation
UK sports and energy UK sports drink UK energy drink
energy drinks which claim a
drinks, 2009 types, 2009 types, 2009
particular energy boost from caffeine,
guarana, taurine and ginseng or
other herbs or some combination of
these ingredients.

Sports 26% Isotonic 91% Glucose 59%

Energy 74% Hypotonic 9% Stimulant 41%
Hypertonic <1%

Source: Zenith International Source: Zenith International Source: Zenith International

People Profile:
change,
c gained a silver Investors in People award,
increase
in clearly demonstrating a commitment to
effi
e ciency training its valuable employees.
and
a Everyone has heard of A G Barr and
reduce
re our Irn-Bru– it’s a truly iconic company. We are
operating
o really proud to be part of its continuing
costs.
c success story.
One
O of
those
th
costs is of course the cost of energy, and
reducing the amount of energy we use has
an environmental benefit as well as a
financial return.
Both of us work within shift patterns –
day shift and back shift – which enables
us to continue our studies for our HNC
in engineering practice on a day release
basis. In our industry, it is important to
improve skills and achieve the necessary
qualifications to keep pace with change.
A G Barr plc Cumbernauld has recently Paul Townsend,
Matthew Limmer
Apprentice maintenance
engineers : A G Barr
The 2010 UK Soft Drinks Report • 17
 OUTLOOK & UK soft drinks forecast, 2009 - 2014
Year 2009 2010 2011 2012 2013 2014

CONCLUSIONS
Million litres 14140 14235 14320 14795 14835 14910
% change +1.7 +0.7 +0.6 +3.3 +0.3 +0.5
Litres per person 229.1 229.4 229.6 235.9 235.3 235.3

Source: Zenith International

The green shoots of economic recovery products, sustainability and ethical endeavour
should hopefully favour the soft drinks have already helped to build engagement and
market and help it grow further in consumer loyalty.
the coming years. A cautious forecast
for a new government, coupled with Tapping into the rapid evolution of online
uncertainty on consumer purchasing social networks and the opportunity for a more
power, should still see 2010 pass the direct dialogue with consumers, the pace of
change within the soft drinks industry should be
14200 million litre barrier.
unrelenting. A flurry of new product development
should be on the horizon – giving renewed vigour
With an Olympic year in 2012, the UK should be to the industry in the years ahead.
bolstered by in-bound tourism – whatever the
weather. Presuming average weather conditions
in the intervening years to 2014, the market
could reach close to 15000 million litres, with
per person consumption hitting 235 litres.

UK soft drinks forecast, 2009 - 2014

Healthier living and positive lifestyle changes
000 million litres
should once again be at the forefront of consumers’ 15
minds, should money pressures lessen.

Innovation will continue to be of paramount 14

importance if companies are to offer something

for everyone, with products adding functional
13
benefits to specific types of consumers as well as
offering value for money. All products will need to
ensure that any claims they make are scientifically 12
proven, honest and true, as any innovation will
need to be trusted to succeed.
11

Corporate social responsibility is likely to reaffirm

its importance to consumers. For a number of 10
2009 2010 2011 2012 2013 2014

Source: Zenith International

18 • The 2010 UK Soft Drinks Report

About BSDA

The British Soft Drinks Association is the national trade association

representing the collective interests of producers and manufacturers of
soft drinks including carbonated soft drinks, still and dilutable drinks, fruit
juices and smoothies, and bottled waters.

BSDA is based in central London with an experienced, professional staff and

is governed by an Executive Council of directors elected from its members. It
provides a central meeting point for the industry and a range of services to
help the industry and its manufacturers to be at the leading edge.

Main membership benefits include:

• Information, advice and advance warning on all aspects of

the industry, including technical standards, best practice and
legislation to ensure good compliance and planning

• Participation in the development of Codes of Practice

and initiatives to promote the industry’s reputation and
demonstrate social responsibility

• Assistance and advice on incident management

• Inclusion in BSDA’s online listing of manufacturers
and suppliers

• Free access to the Members’ website with its information,

advice and publications

• A range of training courses tailored to the industry with

substantial discounts for members

• The opportunity to network with industry colleagues at BSDA

meetings and events and influence BSDA policy-making

The British Soft Drinks For more information about

Association for:- BSDA and its activities contact
• Media & public affairs British Soft Drinks Association
20-22 Stukeley Street
London
• Regulatory issues WC2B 5LR

• Sustainability Telephone: +44 (0) 20 7430 0356

Fax: +44 (0) 20 7831 6014
• Education & skills Email: bsda@britishsoftdrinks.com

Website: www.britishsoftdrinks.com

The 2010 UK Soft Drinks Report • 19

British Soft Drinks Association
20-22 Stukeley Street
London
WC2B 5LR

Telephone: +44 (0) 20 7430 0356

Fax: +44 (0) 20 7831 6014
Email: bsda@britishsoftdrinks.com
Website: www.britishsoftdrinks.com