Research Center of Kbank of Thailand released a report on Mar. 9, which indicated that the rise of the Chinese beverages against the global economic crisis brings chances to the Thai companies.

According to the analysis conducted by the Center, despite the slowing down of the Chinese domestic retail trade with the weakened purchasing power of consumers, and the stress faced by the Chinese beverage industry in the global economic crisis, the midyear recovery of the Chinese economy and the continuous picking up of domestic consumption and commodity retail will help the Chinese beverage industry restore good growth.  

The Center concludes that the growing tendency of the Chinese beverage market, especially the category of juice, brings chances to the Thai companies. Thailand enjoys outstanding advantages and competitiveness in fruit planting and processing, the Thai dealers can supply the Chinese beverage manufacturers with fruits as raw materials, relying on the favourable treatment of zero-tariff on imported fruits in the Agreement on Free Trade between ASEAN and China.

Moreover, those Thai beverage dealers with enough strength and their own brands, can cooperate directly with the Chinese companies, or by import-export agencies, enter the Chinese market using their sale outlets and marketing strategies.

In the aspect of investment, the Thai dealers can produce beverages for the Chinese market together with the local companies well familiarized with the market. The beverages having chances in the Chinese market include refreshing drink, sports drink, juice drink, and other new-type nutritional and healthcare drinks specially for the consumers of fitness and beautification.

Another beverage category worth of attention is natural health drinks for which Thailand has enjoyed R&D and processing capabilities and marketing experiences, including longan juice, Tamarindus indica Linn juice and Chinese cymbidium juice. These drinks are anticipated to be popular among by part of the Chinese consumers, especially those medium and high-end ones who prefer natural healthcare products. But, it will need a big advertising budget to enhance the Chinese consumers’ understanding of and confidence in the natural beverages made in Thailand.

The Center points out that, against the background of slowed down Chinese economy affected by the global economy, the Thai dealers who intend to invest in the Chinese beverages should pay close attention to the risk factors from the world’s economic depression. The external factors will adversely influence the Chinese domestic consumption demand, particularly that of high priced beverages such as alcoholic drinks and various health drinks.

In addition, the Thai dealers should take into full consideration the hot competition from other powerful foreign companies and local Chinese enterprises. They should carry out an elaborate analysis and study on the traditional cultures, customs, manners, lives, behaviours and favours in different regions in China, with a view of developing and launching products being able to meet the demand of the Chinese consumers.

t the same time, the Thai dealers should carefully study the problems and barriers existing in exports to China, including non-tariff barriers to trade, logistics, the rules and regulations on investment in products and packages, and the control systems of food safety. These are all keys to the gate of consumption in China.