Speaking at the launch of the Britvic Soft drinks Review 2022 Paul Graham, managing director at Britvic said that the company had faced three major issues since Covid-19 - operating through the pandemic, logistics and raw material costs. But he said the industry had proved itself to be resilient.
“One of the things that we have been looking at and I suspect most other people are is supply chain resilience and how we can build supply chain resilience back in,” said Graham.
“We are in a lot better place now than we were last year.”
He praised factory and operations staff for continuing to work through the pandemic when they were potentially at risk and said the company had been able to continue to operate its manufacturing sites during the lockdowns. He said moving product was a challenge as the haulage issues hit this time last year but said that the industry had co-operated and worked together.
He said that at the end of 2020 there was concern that the country was heading back to the era of the depression of the 1920s.
He added: “I didn’t see many people talking about the impact of inflation and global supply chains.”
Another challenge facing the food and drink industry is the implementation of HFSS which is coming into force in October, the impact of which must not be underestimated, Graham added.
He said: “As a category we are certainly no stranger to the impact of legislative changes.”
But he considers this an opportunity for the soft drinks sector.
Soft Drinks Industry Levy
“The industry is well prepared because of all the ground work that has been done for the Soft Drinks Industry Levy,” he added.
Graham also said in the report that the industry was still awaiting clarity on the Deposit Return Scheme. He highlighted that closed recycling schemes such as DRS will only be a short-term solution to maintaining rPET supplies as virgin plastic will always be needed to ensure high-quality food-grade plastics.
However, despite the challenges faced by the soft drinks sector the total value of soft drinks market was £15.29bn (£16.4bn 2019).
The report also revealed that consumer trends include premium, elevated experiences and health and wellness.
In the convenience sector stimulants (energy drinks) overtook cola as the biggest category in terms of value sales. Sales of stimulants grew by 21% and increased in value by £116m. In hospitality and foodservice it also outperformed the market growing by 28%.