The COVID-19 situation, both domestic and international, continues to be fraught with uncertainty as purchasing power comes under pressure and consumers tend to spend more cautiously. Moreover, the COVID-19 prevention and control measures in Thailand include restrictions regarding on-premise dining at restaurants in certain areas. As a result, growth for the non-alcoholic beverage market in 2021 is unlikely to be on par with its growth during 2018-2019 (pre-pandemic period), since there are still a lot of unknowns surrounding COVID-19, and consumers' purchasing power continues to be fragile due to risk of unemployment and concerns over personal income. However, both factors may ease in line with gradual economic recovery, provided that the spread of the new COVID-19 outbreak is brought under control within the next 1-2 months.
KResearch projects that the total value of the non-alcoholic ready-to-drink (RTD) beverage market in 2021 will be in the range of THB 197 – 199 billion, rising by 0.5 – 1.5 percent from the low base of 2020, during which the growth rate for most beverages shrank. In addition, manufacturers and retailers have begun to adjust their sales strategies to match lifestyles of the 'new normal' era.
Meanwhile, market competition will become increasingly intense over the forthcoming period as manufacturers compete for a bigger market share, and spur consumers' spending. Primarily, the trends for the traditional beverage market which focuses on mass segment is expected to change in line with economic conditions and purchasing power, likely to retain a majority of their market share. On the other hand, new beverages catering mainly to niche markets are projected to outperform the market average as newer products are developed to more closely meet customers' particular expectations. Nonetheless, the market share for new beverages will remain relatively smaller than that of traditional beverages in the short term. However, these new players will likely garner a larger market share over the long term, driven mainly by consumer demand.
Apart from fiercer market competition and weak purchasing power in 2021, other factors that could affect businesses' adaptability include the third phase of excise tax on sugar-sweetened beverages and the growing trend for usage of eco-friendly packaging that bite into business costs. Therefore, non-alcoholic beverage market is compelled to adjust to related laws and regulations, and changes in consumer demand.