The Bean and Cream in Asia
Essay Preview: The Bean and Cream in Asia
Report this essay
The Bean and Cream In Asia
How coffee/ice-cream, and QSR retail stores are gaining wider acceptance and are poised for tremendous growth in the most populated region of the globe.

Daniel Koh
In a world where the US greenback is half-jokingly being referred to as the US peso, its no wonder that many retailers and companies in general are looking towards cash flush Asia as their focus for new commercial markets. The trend in both specialty coffee retailers and QSR chain growth in Asia is a testament to this thinking. Double digit economic growth, a vast young population, and exploding taste for western consumerism are what are driving the trends for these types of businesses.

This report outlines key markets for UnitedBrands as coffee retail and other QSR supply chain related businesses are our key customers. Their requirements and growth are key indices of our potential for growth and will be presented market by market.

The following are multiple factors affecting change in the emerging Asian markets:
Lifestyle-Asians are fully embracing traditionally western habits such as drinking coffee and eating dairy based products such as frozen yogurt and ice-cream. Also being seen in high profile retail stores consuming western products has always been important in Asian cultures as it signifies a certain position of wealth, but the difference is that now this is much more attainable to masses of Asians than has been in the past. In a word, specialty food & beverage retail stores are becoming hugely popular.

Retail-growth and acceptance of branded and high end retail spaces is at an all-time high as family operated and non-branded retail starts to wane in Asia.

Economics/Demographics-A large population mostly under 40 years old is driving the economic and population growth in Asia.
Government-Asian governments have begun to relax and lower traditionally high tariffs on imported goods and services, and as governmental regulations begin to encourage Foreign Direct Investment in most countries, this will further increase the rate of entry and growth for the specialty retail industry.

Source: Starbucks Asian_Markets report
This report outlines key markets for UnitedBrands as coffee retail and other QSR supply chain related businesses are our key customers. Their requirements and growth are key indices of our potential for growth and will be presented market by market.

TABLE 1
Although demand in the food, beverage and tobacco sector in Asia is expected to grow at a moderate 3.4% in 2010-2014, in value terms, sales of food are expected to almost double, from US $2.7 trillion in 2010 to US $4.6 trillion in 2014 (table above). Demand growth will be strongest in China, where it is predicted to average 5.7% in the forecast period (table below). India will see 3.2% average annual demand growth, and in Hong Kong, demand will be up 3.3% over 2009, but will average a weaker 2.3% annually through 2014. In Japan, demand growth is expected to decline each year through 2014.

Food, beverages & tobacco: Market demand growth (% real change pa)
Territory
2014
China
Hong Kong
India
Japan
Taiwan
2007-2008: Estimates
2009-2014: Forecasts
China
The Food and Beverage business (F&B) is surely booming in China – home to the worlds largest population and a nation whose economy has been rapidly growing since its opening up. According to “the Eleventh Five-year Outline for Commercial Development” issued by Chinas Ministry of Commerce, the actual growth rate of added value in catering industries is set to increase 9% annually from 2006 to 2010. As a traditional pillar industry in Chinas service sector, sales of food and beverage has maintained an annual growth rate of over 10% for 16 years. As a traditional pillar industry in Chinas service sector, sales of food and beverage has maintained an annual growth rate of over 10% for 16 years. In 2007, the combined sales from food & beverage and accommodation sectors have surged 19.4% year-on-year to surpass RMB 1.2 trillion, three percentage points higher than the growth rate of the previous year. Over 938 foreign-funded enterprises have been set up in 2007, down 11.5% year-on-year, while investments exceeded US$1 billion, up 25.8% year-on-year. Figure 3.2.1 shows Chinas F&B sales from 1991 to 2007.

Chinas chain and franchise business in the F&B industry started in 1987 when KFC Corp launched its first franchise in Beijing. After nearly two decades of development, chain and franchise businesses have become a mainstay in Chinas food and beverage sector. Turnover from chain catering enterprises that are above designated size has soared 21.5% year-on-year to RMB 55.2 billion in 2006, 98.6% of which comes from the sale of meals and 1.4% from sales of commodities. Among all the business categories, meal revenue from chain and franchise restaurants jumped 22.3% year-on-year to RMB 30.3 billion in 2006, accounting for 55.7% of the total. At the same time, fast food chains have realized meal revenues of RMB 22.4 billion, making up 41.1% of the total. The share of fast food chains was 17.7% lower than that in 2004. Figure 3.2.2 illustrates the chain F&B business breakdown by revenue from

Coming of age in the Middle Kingdom is the specialty coffee shop, a Western equivalent to the beloved Chinese teahouse. Going out for a cup of coffee and a little chitchat has become trendy and fashionable with white-collar workers, students and the rest of the emerging middle class in China, especially those aged between 20-50 years old. Last year, a survey conducted in Chinas larger cities revealed that 24% of those aged 41-50 years old and 18% of those aged 20-30 years old often sip a coffee, the Guangzhou Daily newspaper reported.

Leader in the field of specialty shops is Seattle-based

Get Your Essay

Cite this page

Tremendous Growth And Eleventh Five-Year Outline. (June 9, 2021). Retrieved from https://www.freeessays.education/tremendous-growth-and-eleventh-five-year-outline-essay/