Oman Softdrinks 2006

GCC SOFT DRINKS 2006
OMAN

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June 2006
COPYRIGHT by IMES Consulting, June 2006

Middle East Non- Alcoholic Beverages 2006 - Oman"

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I MES Consul ti ng Group - Mi ddl e East Non- Alcoholic Beverages 2006 - Oman
June 2006 IMES Consulting i
TABLE OF CONTENTS Page

A1. MARKET OVERVIEW 1

A1.1 INTRODUCTION 1
A1.2 POPULATION 2
A1.3 KEY MACRO-ECONOMIC DRIVERS 4

A2. NON-ALCOHOLIC BEVERAGES 6

A2.1 BEVERAGE INDUSTRY DEVELOPMENT 6
A2.2 REGULATORY ENVIRONMENT 10
A2.3 CONSUMPTION OF NON-ALCOHOLIC BEVERAGES
- A SUMMARY 11

B1. CARBONATED SOFT DRINKS 20

B1.1 OVERALL DEMAND LEVELS 20
B1.2 KEY SEGMENTATIONS 24
B1.3 SOURCING 30
B1.4 BRAND/SUPPLIER SHARES 39
B1.5 PRICING AND DISTRIBUTION 41
B1.6 FIVE-YEAR FORECASTS 43

B2. JUICE PRODUCTS 44

B2.3 SOURCING 55

B3. PACKAGED WATER 74

B3.3 SOURCING 83
June 2006 IMES Consulting ii

B4. LIQUID DILUTE DRINKS 100

B4.3 SOURCING 108

B5. POWDERED FRUIT DRINKS 112

B5.3 SOURCING 117

B6. MALT BEVERAGES 122

B6.3 SOURCING 129

B7. ENERGY DRINKS 136

B7.3 SOURCING 141

June 2006 IMES Consulting iii

B8. SPORTS AND HEALTH DRINKS 145

B8.3 SOURCING 152

B9. READY-TO-DRINK TEA 156

B9.3 SOURCING 163

B10. DAIRY/JUICE BLENDS 167

B11 FLAVOURED WATER 168

Appendix: Directory of Importers and Local Beverage
Producers, 2006 169
I MES Consulting Group - Mi ddl e East Non- Alcoholic Beverages 2006 - Oman

A1. MARKET OVERVIEW
June 2006 IMES Consulting

1
A1.1 INTRODUCTION

The Sultanate of Oman is situated in the Southeast of the Arabian Peninsula bordering the UAE to
the North, Saudi Arabia to the West and Yemen to the Southwest. The main conurbations are the
Capital Area, a long thin stretch of various municipalities (including Muscat, Matrah and Ruwi)
along the North coast, and Salalah in the extreme South, close to the border with Yemen.
However, a considerable portion of the countrys population is dispersed in the rugged Interior.

The overall climate is dry and hot in the Interior but humid along the coastline. The far South of
the country is characterised by a summer monsoon.

Government is a traditional monarchy, headed since 1970 by Sultan Qaboos bin Said Al Said, who
governs in consultation with his cabinet. Although Oman has been independent since the 17
th
century there has been a strong
British influence which is still evident in various aspects of the country (e.g. the legal system) today.


A1. MARKET OVERVIEW

2
A1.2 POPULATION

The table below examines the development of Omani population over the period 2001 to 2005 (historical) and forecast to 2010.

Table A1: Oman Population, 2001-2010

Million persons
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Nationals 1.66 1.72 1.78 1.84 1.90 1.97 2.03 2.10 2.17 2.24
Expatriates 0.65 0.60 0.55 0.53 0.50 0.48 0.45 0.43 0.41 0.39
Total 2.31 2.32 2.33 2.37 2.40 2.45 2.48 2.53 2.58 2.61

Key Points:

The population of Omani nationals is growing at a rate of just under 3.5% per annum. Families tend to be large and
extended (an average of eight per household).


A1. MARKET OVERVIEW

3

By contrast, the expatriate population, consisting largely of Indians, is in decline. Over recent years the Government has
pursued a policy of Omanisation (referred to locally as SANAD), outlining quantitative goals aimed at increasing the
percentage of Omanis in the workforce. This has led to the departure of expatriate workers whose jobs have been
Omanised. The expatriate population fell by 23% between 2001 and 2005, and is forecast to continue falling to 2010.

Despite falling expatriate numbers, the total population continues to grow, reaching 2.40 million in 2005.

The high birth rate among locals ensures that the population is relatively young, with around one-third under the age of
15 years.

Only a little more than 50% of the population can be classified as being urbanised, with large numbers of people
dispersed in villages along the coast and in the Interior.


A1. MARKET OVERVIEW

4
A1.3 KEY MACRO-ECONOMIC DRIVERS

The Omani economy is largely dependent on production of oil and gas, of which it has significant (if modest in regional terms)
reserves. These account for some 40% of Gross Domestic Product and over 75% of export earnings. However, the country has for
some time been preparing for the depletion of these resources through seeking to diversify the economy in various ways under its
Vision 2020 plan. Initiatives include:

Investments in several heavy industrial projects including a planned aluminium smelter

Incentives to encourage foreign investment, particularly in light industry and tourism

Privatisation of several sectors of the economy

Programmes to encourage tourism (positioning Oman as a relaxing accompaniment to a frenetic stay in Dubai).

Key economic indicators for Oman are shown below:

Table A2: Oman: Key Economic Indicators

2001 2002 2003 2004 2005 (E)
GDP (US $ billion) 19.9 20.1 21.7 22.4 25.4
GDP per capita (US$) 8,614 8,663 9,313 9,451 10,583

The Omani Riyal (OR) is fixed to the US dollar at a rate of US$ 1 = OR 0.385


A1. MARKET OVERVIEW

5

A key element of the Governments programme is to integrate more Omanis into the economy and reduce reliance on expatriate
workers. This policy is referred to locally as SANAD (loosely an acronym for self employment and national development) and has
achieved some success as evidenced by the population tables above. However, this has not been without consequences for the
consumer goods business.

One sector chosen for Omanisation has been the operation of small groceries or bagalas. As a result, many experienced Indian store
owners have been put out of business, and Omanis have taken over. Unfortunately, few of these new operators have any experience
of running a store and they make fundamental errors with stock ordering, misuse of credit facilities etc. Unsurprisingly, many have
failed to make a success of their businesses, and large numbers of bagalas have closed one estimate is that the number was down
by almost 25% between 2002 and 2004. Indeed, it is reported that some pockets of the country have been left with no stores at all,
and that inhabitants are forced to make long journeys into towns to buy even basic items. Those bagalas that have survived are
prone to being out of stock on key items, due both to inadequate ordering and suppliers being forced to withdraw credit facilities.
This has clear implications if goods are simply unavailable, consumers cannot buy them. In 2005, recognising the problem, the
government launched a training scheme for bagala owners on how to successfully run their stores. The impact this will have remains
to be seen, but one supplier estimated that only 40% of the number of bagalas that existed in 2002 would remain.

A positive development to come out of this, however, is that supermarkets are taking the opportunity to expand out of their core
areas (e.g. the Capital Area) and open branches in secondary urban areas. At the same time, professionally operated convenience
store chains (e.g. on petrol station forecourts) are also growing. One leading FMCG distributor estimated that in 2004 this modern
trade accounted for 45% of business, up from 36% in 2002.

In another step towards Omanisation, a law came into effect in late 2005 which required all drivers of commercial vehicles under 7
tonnes gross weight to be Omani. Suppliers have so far had mixed success in finding sufficient drivers with an appropriate work
ethic.

A2. NON-ALCOHOLIC BEVERAGES

6
A2.1 BEVERAGE INDUSTRY DEVELOPMENT

There were few significant changes in the structure of the beverage industry in 2005. The key elements of this structure are
summarised below; more detailed profiles of key companies are provided in the relevant product sections.

Carbonated Soft Drinks:

There are four local producers and one significant importer of carbonates:

o Pepsi-Cola brands: Oman Refreshment Co. (Capital Area)

o Coca-Cola brands: Local sales subsidiary of Al Ahlia- Gulf Line General Trading Co. (UAE)

o Cott brands: National Beverages Co. (Capital Area)

o Own brands: Dhofar Beverage Co. (Salalah)
Ali Shaihani Juice Filling Industries (Capital Area)

A fifth local producer Reem Beverage Industries ceased production in late 2003.

Local producers supply over 90% of market requirements.



7
Juice Products:

There are six significant local producers of juice products:

o National Beverage Co. (NBC)
o Oman Refreshment Co. (ORC)
o Oman National Dairy Products (ONDP)
o Dhofar Beverages
o Dhofar Cattle Feed
o Ali Shaihani Juice Filling Industries.

Of these, ONDP and Dhofar Cattle Feed are primarily dairy companies, NBC, ORC and Dhofar Beverages are primarily beverage
companies, and Ali Shaihani is a snack foods company.

Together, these local companies supplied around 55% of the market in 2005.

Note that Reem Beverage Industries ceased production in 2003, while Modern Dairy Factory only spasmodically produces tiny
volumes of an artificial cup drink under the AL KAMAYIL brand.

Imports account for 45% of the market. The most important suppliers are:

o Al Rawabi (UAE)
o Aujan (Saudi Arabia)
o Unikai (UAE)
o Almarai (Saudi Arabia)


8
Packaged Water:

In 2005 locally packaged water accounted for 69% of the market. There are four significant local suppliers:

o National Mineral Water (cups, bottles and dispensers)
o Al Mazyona Mineral Water (cups, bottles and dispensers)
o Dhofar Beverages (cups and bottles)
o Oasis Water Factory (dispensers, bottles)

Note that Al Mazyona contract packs its bottles for Dhofar Beverages.

In addition, there are a large number of other dispenser water suppliers, each being individually small.

Imports play a significant role in the market (indeed, one which has increased since 2004), the key participants being:

o Masafi (UAE) distributed by National Beverages
o Pepsi (AQUAFINA brand UAE) distributed by Oman Refreshments
o Coca-Cola (ARWA brand UAE) distributed by Al Ahlia

Liquid Dilute Drinks:

All liquid dilute drinks are imported, with Saudi Arabia (Aujans VIMTO plus others) being the main source.


9
Powdered Fruit Drinks

Although there is one local producer of powdered fruit drinks, its impact is negligible. To all intents the market can be regarded as
supplied entirely by imports with the USA (TANG) being the dominant source.

Malt Beverages

Although Oman is the only GCC country where production of malt beverages is permitted, there is currently no local producer since
the only one established (Reem Beverage Industries) ceased production. The market is therefore entirely import dependent, with
almost all products coming from Europe.

Energy Drinks

There is no longer any local production of energy drinks (Oman Refreshments having given up on PEPSI X) and the key source of
imports is Austria.

Sports & Health Drinks

There is not now, nor has there ever been, any local production of sports or health drinks in Oman. Interestingly, there are not even
any regionally manufactured sports or health drinks. The main source of sports drinks is Indonesia, while the leading health drink is
imported from Japan.

Ready-To-Drink Tea

There is no local production of RTD tea products in Oman; the market is totally dependent on imports. The two leading supplying
countries are Saudi Arabia and Austria.


10
A2.2 REGULATORY ENVIRONMENT

Oman is a member of the World Trade Organisation and the country enjoys an open trading environment.

Non-GCC imports are commonplace in the market for soft drinks in Oman, though they are far outweighed in market share terms by
GCC sourced goods. Since the GCC initiated full customs union in 2003 there are no import tariffs at all on internally (GCC)
manufactured products, whilst the standard 5% is levied on all non- GCC products.

Note that sales of carbonated soft drinks in government schools are banned, as are juice products in cans and glass bottles.


11
A2.3 CONSUMPTION OF NON-ALCOHOLIC BEVERAGES A SUMMARY

Table A3: Oman: Estimated Total Consumption of Non-Alcoholic Beverages by VOLUME, 2001-2005 (Mn litres)

Sector 2001 2002 2003 2004 2005 CAGR (%)
Carbonates 137.7 119.8 123.2 130.6 141.9 0.8%
Juice products
1

54.3 59.6 65.2 71.9 79.3 9.9%
Still bottled water
2

90.5 98.4 106.0 111.7 127.7 9.0%
Sparkling bottled water
0.1 0.1 0.1 0.1 0.1 0.0%
Dispenser water
31.2 34.4 37.3 42.7 43.0 8.3%
Dilute drinks
3

6.4 6.7 7.0 8.0 9.3 9.8%
Powdered fruit drinks
3

18.8 18.5 18.6 19.1 19.6 1.0%
Malt beverages
1.7 1.8 1.9 1.7 1.9 2.8%
Dairy/juice blends
0.0 0.0 0.0 0.0 0.0 0.0%
Energy drinks
0.1 0.1 0.2 0.4 0.5 51.0%
Sports/health drinks
0.4 0.5 0.7 0.9 1.0 23.4%
RTD tea products
0.3 0.3 0.3 0.4 0.3 2.9%
Flavoured water
0.0 0.0 0.0 0.0 0.0 0.0%
Grand total 341.5 340.3 360.6 385.2 424.6 5.6%
Volume growth 9.0% -0.4% 6.0% 6.8% 10.2%

1
Includes still juice drinks, nectars and juices
2
In packs up to 6 litres
3
In single-strength equivalent (ie in diluted form)


12
Table A4: Oman: Estimated Total Consumption of Non-Alcoholic Beverages by VOLUME, 2001-2005 (Mn 8oz cs)

Sector 2001 2002 2003 2004 2005 CAGR (%)
Carbonates 24.3 21.1 21.7 23.0 25.0 0.8%
Juice products
1

9.6 10.5 11.5 12.7 14.0 9.9%
Still bottled water
2

16.0 17.4 18.7 19.7 22.5 9.0%
0.0 0.0 0.0 0.0 0.0 0.0%
Dispenser water
5.5 6.1 6.6 7.5 7.6 8.3%
Dilute drinks
3

1.1 1.2 1.2 1.4 1.6 9.8%
3

3.3 3.3 3.3 3.4 3.5 1.0%
Malt beverages
0.3 0.3 0.3 0.3 0.3 2.8%
Dairy/juice blends
0.0 0.0 0.0 0.0 0.0 0.0%
Energy drinks
0.0 0.0 0.0 0.1 0.1 51.0
0.1 0.1 0.1 0.2 0.2 23.4%
RTD tea products
0.1 0.1 0.1 0.1 0.1 2.9%
Flavoured water
0.0 0.0 0.0 0.0 0.0 0.0%
Grand total 60.2 60.0 63.6 67.9 74.8 5.6%
Volume growth 9.0% -0.4% 6.0% 6.8% 10.2%

1
2
3


13
Table A5: Oman: Estimated Total Consumption of Non-Alcoholic Beverages by RETAIL VALUE, 2001-2005 (Omani
Riyals)

Sector 2001 2002 2003 2004 2005 CAGR (%)
Carbonates 28.9 28.0 28.8 30.8 33.6 3.8%
Juice products
1

16.0 17.7 19.5 21.4 23.8 10.5%
Still bottled water
2

7.5 7.8 7.9 7.9 8.3 2.5%
0.0 0.0 0.0 0.0 0.0 0.0%
Dispenser water
1.4 1.7 1.7 1.8 1.8 6.8%
Dilute drinks
0.7 0.8 0.8 0.9 1.0 10.4%
3.8 3.8 3.6 3.7 3.7 -0.4%
Malt beverages
0.9 1.0 1.0 0.9 1.0 3.7%
Dairy/juice blends
0.0 0.0 0.0 0.0 0.0 0.0%
Energy drinks
0.2 0.3 0.4 0.7 0.9 47.2%
0.4 0.6 0.8 0.9 1.0 26.8%
RTD tea products
0.2 0.2 0.2 0.2 0.2 -0.5%
Flavoured water
0.0 0.0 0.0 0.0 0.0 0.0%
Grand total 60.1 61.7 64.7 69.2 75.4 5.9%
Value growth 6.5% 2.7% 4.9% 7.0% 8.9%

1
2


14
Table A6: Oman: Estimated Total Consumption of Non-Alcoholic Beverages by RETAIL VALUE, 2001-2005 (Mn US $)

Sector 2001 2002 2003 2004 2005 CAGR (%)
Carbonates 75.1 72.7 74.8 80.1 87.3 3.8%
Juice products
1

41.6 46.0 50.7 55.6 61.9 10.5%
Still bottled water
2

19.5 20.2 20.5 20.6 21.5 2.5%
0.1 0.1 0.1 0.1 0.1 0.0%
Dispenser water
3.7 4.3 4.5 4.7 4.7 6.8%
Dilute drinks
1.9 2.0 2.1 2.4 2.7 10.4%
10.0 9.8 9.3 9.5 9.7 -0.4%
Malt beverages
2.3 2.5 2.6 2.3 2.7 3.7%
Dairy/juice blends
0.0 0.0 0.0 0.0 0.0 0.0%
Energy drinks
0.5 0.7 1.2 1.8 2.4 47.2%
1.1 1.7 2.0 2.4 2.7 26.8%
RTD tea products
0.5 0.5 0.5 0.6 0.5 -0.5%
Flavoured water
0.0 0.0 0.0 0.0 0.0 0.0%
Grand total 156.2 160.4 168.3 180.1 196.2 5.9%
Value growth 6.5% 2.7% 4.9% 7.0% 8.9%

1
2


15
Table A7: Oman: Estimated Total Consumption of Non-Alcoholic Beverages, 2001-2005 (volume % of total)

Sector 2001 2002 2003 2004 2005
Carbonates 40.3 35.2 34.2 33.9 33.4
Juice products
1

15.9 17.5 18.1 18.7 18.7
Still bottled water
2

26.5 28.9 29.4 29.0 30.1
0.0 0.0 0.0 0.0 0.0
Dispenser water
9.1 10.1 10.3 11.1 10.1
Dilute drinks
1.9 2.0 1.9 2.1 2.2
5.5 5.4 5.2 5.0 4.6
Malt beverages
0.5 0.5 0.5 0.4 0.4
Dairy/juice blends
0.0 0.0 0.0 0.0 0.0
Energy drinks
0.0 0.0 0.1 0.1 0.1
0.1 0.2 0.2 0.2 0.2
RTD tea products
0.1 0.1 0.1 0.1 0.1
Flavoured water
0.0 0.0 0.0 0.0 0.0
Grand total 100.0 100.0 100.0 100.0 100.0

1
2


16
Table A8: Oman: Estimated Total Consumption of Non-Alcoholic Beverages, 2001-2005 (value % of total)

Sector 2001 2002 2003 2004 2005
Carbonates 48.1 45.3 44.4 44.5 44.5
Juice products
1

26.6 28.7 30.1 30.9 31.6
Still bottled water
2

12.5 12.6 12.2 11.4 11.0
0.1 0.1 0.1 0.1 0.1
Dispenser water
2.4 2.7 2.7 2.6 2.4
Dilute drinks
1.2 1.2 1.2 1.3 1.4
6.4 6.1 5.5 5.3 5.0
Malt beverages
1.5 1.6 1.5 1.3 1.4
Dairy/juice blends
0.0 0.0 0.0 0.0 0.0
Energy drinks
0.3 0.4 0.7 1.0 1.2
0.7 1.0 1.2 1.3 1.4
RTD tea products
0.3 0.3 0.3 0.3 0.3
Flavoured water
0.0 0.0 0.0 0.0 0.0
Grand total 100.0 100.0 100.0 100.0 100.0

1
2


17
Table A9: Oman: Estimated PER CAPITA CONSUMPTION of Non-Alcoholic Beverages, 2001-2005 (litres)
Beverage Type 2001 2002 2003 2004 2005 CAGR 01-05
Total packaged beverages 147.8 146.7 154.8 162.5 175.2 4.6%
Carbonates 59.6 51.6 52.9 55.1 59.1 -0.2%
Juice products
1
23.5 25.7 28.0 30.3 33.0 8.9%
Still bottled water
2
39.2 42.4 45.5 47.1 53.2 7.9%
Sparkling bottled water 0.0 0.0 0.0 0.0 0.0 0.0%
Dispenser water 13.5 14.8 16.0 17.8 17.9 7.3%
Dilute drinks
3
2.8 2.9 3.0 3.4 3.9 8.5%
3
8.1 8.0 8.0 8.1 8.2 0.2%
Malt beverages 0.7 0.8 0.8 0.7 0.8 3.1%
Dairy/juice blends 0.0 0.0 0.0 0.0 0.0 0.0%
Energy drinks 0.0 0.1 0.1 0.2 0.2 50.1%
Sports/health drinks 0.2 0.2 0.3 0.4 0.4 20.4%
RTD tea products 0.1 0.1 0.1 0.2 0.1 8.8%
Flavoured water 0.0 0.0 0.0 0.0 0.0 -
Total other 205.4 210.2 214.5 219.4 222.8 2.1%
Tea 117.5 120.0 122.1 124.0 125.9 1.7%
Coffee 40.9 41.7 42.4 43.1 43.8 1.7%
Other hot beverages - - - - - -
Liquid dairy products
4
23.9 25.8 27.0 29.3 31.6 7.2%
Retail milk powder
4
23.0 22.8 22.9 23.0 21.5 -1.7%
Total liquid intake commercial
Products
353.2 356.9 369.3 381.9 399.7 3.1%
Estimated Population (million) 2.31 2.32 2.33 2.37 2.40

1
2
3
4
Includes UHT milk, pasteurised milk, laban, concentrated milks


18

Table A10: Oman: Forecast Total Consumption of Non-Alcoholic Beverages by VOLUME, 2005-2010 (million litres)

Sector 2005 2006 2007 2008 2009 2010 CAGR (%)
Carbonates 141.9 146.8 151.4 155.7 159.6 163.4 2.7%
Juice products
1
79.3 85.0 90.5 95.9 101.3 106.7 5.8%
Still bottled water
2
127.7 134.3 140.8 146.7 151.8 156.7 3.9%
Sparkling bottled water 0.1 0.1 0.1 0.1 0.1 0.2 10.0%
Dispenser water 43.0 45.6 48.8 52.3 55.7 59.1 6.7%
Dilute drinks 7.3 7.4 7.5 7.7 7.8 8.0 2.0%
Powdered fruit drinks 19.6 19.8 20.0 20.3 20.5 20.8 1.2%
Malt beverages 1.8 1.9 2.0 2.1 2.2 2.3 4.9%
Dairy/juice blends 0.0 0.1 0.2 0.3 0.4 0.5 49.5%
Energy drinks 0.5 0.7 0.9 1.0 1.1 1.2 13.5%
Sports/health drinks 1.0 1.2 1.3 1.6 1.6 1.7 10.3%
RTD tea products 0.4 0.5 0.5 0.5 0.5 0.5 4.7%
Flavoured water 0.0 0.1 0.1 0.1 0.1 0.2 18.9%
Grand total 424. 7 446.6 467.8 488.3 507.3 526.2 4.2%
Volume growth 10.2% 5.2% 4.8% 4.4% 3.9% 3.7% -

1
2


19
Table A11: Oman: Forecast PER CAPITA CONSUMPTION of Non-Alcoholic Beverages, 2005-2010 (litres)

Sector 2005 2006 2007 2008 2009 2010 CAGR (%)
Carbonates 59.1 59.9 61.0 61.5 61.9 62.1 0.9%
Juice products
1
33.0 34.7 36.5 37.9 39.3 36.6 4.0%
Still bottled water
2
53.2 54.8 56.8 58.0 58.9 59.6 2.1%
Sparkling bottled water 0.0 0.0 0.0 0.1 0.1 0.1 8.1%
Dispenser water 17.9 18.6 19.7 20.7 21.6 22.5 4.8%
Dilute drinks 3.9 4.3 4.6 4.7 4.8 3.0 3.6%
Powdered fruit drinks 8.2 8.1 8.1 8.0 8.0 7.9 -0.6%
Malt beverages 0.8 0.8 0.8 0.8 0.9 0.9 3.0%
Dairy/juice blends 0.0 0.0 0.1 0.1 0.2 0.2 46.9%
Energy drinks 0.2 0.3 0.4 0.4 0.4 0.4 11.6%
Sports/health drinks 0.4 0.5 0.5 0.6 0.6 0.6 6.7%
RTD tea products 0.1 0.1 0.2 0.2 0.2 0.2 7.0%
Flavoured water 0.0 0.0 0.0 0.0 0.0 0.1 16.8%
Grand total 176.9 182.3 188.6 193.0 196.6 200.1 2.4%
Volume growth 8.9% 3.0% 3.5% 2.3% 1.9% 1.7% -

1
2

B1. CARBONATED SOFT DRINKS

B1.1 OVERALL DEMAND LEVELS


20
Table B1 to B2 below summarise the development of the Oman carbonated soft drinks market during the period 2001-2005.

Table B1: Carbonated Soft Drinks, Million Litres, 2001-2005

Million litres Growth (%)
2001 2002 2003 2004 2005 2001 2002 2003 2004 2005
Consumption 137.7 119.8 123.2 130.6 141.9 (6.4) (13.0) 2.8 6.0 8.7
Litres per capita 59.6 51.6 52.9 55.1 59.1 (8.0) (13.4) 2.5 4.2 7.3

Table B2: Carbonated Soft Drinks, Retail Value, 2001-2005

US$ million Growth (%)
2001 2002 2003 2004 2005 2001 2002 2003 2004 2005
Market value 75.1 72.7 74.8 80.1 87.3 (6.5) (3.2) 2.9 7.1 9.0
Sales per capita $ 32.51 31.34 32.10 33.80 36.37 (8.1) (3.6) 2.4 5.3 7.6





21
105
110
115
120
125
130
135
140
145
2001 2002 2003 2004 2005
M
i
l
l
i
o
n

L
i
t
r
e
s





22
Key Points:

Carbonates consumption in Oman has grown by an average annual rate of almost 1% since 2001 to reach 141.9 million
litres in 2005. However, this figure disguises the true picture of the market, where a decline of over 18% between 2000
and 2002 was followed by recovery of 9% in 2003 and 2004 in what might be considered a return to market stability.
Consumption in 2005 is gradually approaching the levels registered in 2000. This pattern can be attributed to a number
of factors:

o Both major producers were running very aggressive price promotions on MSPET bottles from 1999 until mid-2001.
The cessation of these promotions led to sudden price increases with a consequent decline in demand

o Coca-Cola spent particularly heavily on advertising and promotions in 2000 in order to go head-to-head with Pepsi,
but cut back on this in 2001

o Anti-US sentiment resulting from the attack on Afghanistan in 2002 led to unofficial boycotts in some parts of the
Middle East, and the effects of this were noticeable in the Omani interior

o By 2003, interest in the boycott was waning and consumer interest in the market was rekindled by competition
between market leader MOUNTAIN DEW (Pepsi) and newly launched citrus carbonate QUWAT JABAL from Coca-Cola.
Slight growth resulted

o Growth continued in 2004 and 2005 as Pepsi reasserted its market dominance and National Beverages performed well
with its lower priced 200 ml bottled carbonates all underpinned by improved prosperity resulting from higher oil
prices.




23

In value terms, the market is worth around US$ 87 million at retail level in 2005. However, market values have
developed in a very different pattern to market volumes due to shifts in the relative importance of different pack types.
In 2001, nearly 40% of volume was in MSPET bottles whereas by 2005 this was down to 21%. Conversely, the share of
cans rose from 47% to 63% over the same period. As the retail price of cans is significantly higher on a per litre basis
(32% higher in 2002), market value declined far less dramatically than market volume. The shift toward cans since 2003
has since resulted in market value growing ahead of volume.



B1.2 KEY SEGMENTATIONS


24
B1.2.1 FLAVOUR

Table B3: Carbonated Soft Drinks, By Flavour, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Citrus 52.1 51.5 57.5 59.8 66.7 6.4 (19.6) (1.2) 11.7 4.0 11.5
Cola 48.9 39.5 37.2 35.3 36.4 (7.1) (2.2) (19.2) (5.8) (5.1) 3.1
Lemon/lime 10.0 8.4 9.9 11.4 12.3 5.3 (2.9) (16.0) 17.9 15.2 7.9
Orange 8.7 7.2 7.2 8.8 9.8 3.0 (26.3) (17.2) 0.0 22.2 11.4
Red 14.0 9.6 8.3 8.6 9.2 (10.0) 89.2 (31.4) (13.5) 3.6 7.0
Other 3.9 3.6 3.1 6.7 7.5 17.8 34.5 (7.7) (13.8) 116.1 11.9
Total 137.7 119.8 123.2 130.6 141.9 0.8% (6.4) (13.0) 2.8 6.0 8.7





25

Share of Total (%)
2001 2002 2003 2004 2005
Citrus 38 43 47 46 47
Cola 36 33 30 27 26
Lemon/lime 7 7 8 9 9
Orange 6 6 6 7 7
Red 10 8 7 7 6
Other 3 3 3 4 5
Total 100 100 100 100 100

Key Points:

Perhaps uniquely, citrus is the dominant flavour in Oman, with a 47% market share in 2005. This is almost entirely due
to the almost iconic status of Pepsis MOUNTAIN DEW, which is by far the leading brand in the carbonates market.
Stories abound of individuals who drink at least six cans of DEW each day while critics and admirers alike describe
some people as treating it almost like a drug. Interestingly, attempts by competitors to emulate MOUNTAIN DEW, and
most notably Coca-Colas launch of QUWAT JABAL (literally Mountain Force) in July 2003, have not dented DEWs
dominance, suggesting that its leadership is far more about branding than simply flavour (in blind tastings, most
consumers cannot tell the difference between MOUNTAIN DEW and QUWAT JABAL).




26

Cola is the second most important flavour, although it continues to decline in relative terms. It reached its highest
market share of recent years in 2001 when Coca-Cola was at its most aggressive, but perhaps suffered more than other
flavours from the effects of the anti-US boycott. It remains popular among children (as demonstrated by the high
percentage of National Beverages low priced RC brand sales in cola flavour) and given this it may well recover share in
the future.

Lemon/lime has remained the same in importance (main brand: 7-UP).

After something of a decline between 2000 and 2002, orange has recovered a little due to the resilience of MIRINDA and
the success of RC in tangerine flavour.

Red flavours (strawberry, blackcurrant, raspberry, mixed berry etc.) have declined sharply from their 2001 peak, which
seems to have represented something of a fad in the market. Sales have stabilised in the last two years. The leading
brand is Pepsis SHANI.

While still small, other flavours have grown strongly. The main contributors to this have been MIRINDA apple and sales
of mixers for use with alcoholic drinks as tourist numbers have grown.

Diet variants of the major flavours (cola, lemon/lime) grew by 10%, but volumes still remain small.




27
B1.2.2 PACKAGING

Table B4: Carbonated Soft Drinks, by Pack Type, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Cans 64.5 66.5 70.7 79.1 88.9 8.4% 5.4 3.1 6.3 11.9 12.4
MSPET 53.2 33.2 31.3 31.0 29.7 (13.6) (17.0) (37.6) 5.7 (1.0) (4.2)
Non-ret. Glass 18.4 18.5 19.7 19.1 21.8 4.3% (8.5) 0.5 6.5 (3.0) 14.0
SSPET <0.1 <0.1 - - - - - - - -
PVC <0.1 <0.1 <0.1 <0.1 <0.1 - - - - -
Postmix/Premix 1.5 1.5 1.4 1.4 1.5 0.4 (11.7) - (6.6) - 8.7
Total 137.7 119.8 123.2 130.6 141.9 0.8 (6.4) (13.0) 2.8 6.0 8.7





28

Share of Total (%)
2001 2002 2003 2004 2005
Cans 47 55 56 60 63
MSPET 39 28 25 24 21
Non-ret. Glass 13 15 17 15 15
SSPET Neg Neg 0 0 0
PVC Neg Neg Neg Neg Neg
Postmix/Premix 1 1 1 1 1
Total 100 100 100 100 100

Key Points:

The key feature of the last five years has been the decline in importance of MSPET and the growth in cans. From 1999 to
mid-2001, MSPET bottles were on heavy price promotion, and this doubtless distorted the natural shape of the market.
Once these promotions were ended, sales of MSPET declined substantially. The beneficiary of this decline was cans,
which while always the leading seller in unit terms are now clearly the dominant form of packaging in volume terms.
Retailers, and particularly smaller ones, are said to prefer the cans robustness while consumers like the cold feel of a
chilled can of DEW.




29

But for minor fluctuations, the market share of non-returnable glass has remained broadly stable over the period as a
whole. Sales remain healthy mainly due to the strong sales of National Beverages RC brands (RC COLA and ROYAL
CROWN in various flavours), which are packed in 200 ml NRB that retail at 50 baiza (half the price of a canned
carbonate) and are thus popular with children. Pepsi and Coca-Cola also continue to offer NRB.

There are currently no carbonates packed in SSPET in the Omani market. Coca-Cola introduced this pack type in 2001
but sales were poor (possibly as much to do with Coca-Colas poor performance as any inherent dislike of the pack) and
it was subsequently withdrawn.

Juice Filling Industries markets two brands of carbonate (FIZZI and SHAMI) in PVC bottles of 200 ml and 296 ml. The
larger size scarcely sells at all since it retails at 100 baiza the same as a larger can of a major brand, while the smaller
bottle achieves minor volumes due to its 50 baiza price. The overall impact on the market is negligible.

Small but broadly steady volumes of carbonates are sold through post-mix dispensers in food service outlets and bars.
This may increase in coming years as Oman develops its tourism industry.



B1.3 SOURCING


30

Table B5: Carbonated Soft Drinks, Local vs Imports, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Local 108.9 102.0 111.4 118.0 128.0 4.1 4.8 (6.3) 9.2 5.9 8.5
Import 28.8 17.8 11.8 12.6 13.9 (16.7) (33.5) (38.2) (33.7) 6.8 10.3
Total 137.7 119.8 123.2 130.6 141.9 0.8 (6.4) (13.0) 2.8 6.0 8.7



B1.3 SOURCING


31
0
20
40
60
80
100
120
140
2001 2002 2003 2004 2005
M
illio
n

L
it
r
e
s
Local
Import

Key Points:

Over 90% of the Omani market is supplied by local production. This percentage has gradually increased from just over
70% in 2000, as the fortunes of Coca-Cola have declined (all imported) and those of Pepsi (locally manufactured) have
improved.



B1.3 SOURCING


32

By 2005, the main imports to Oman were:

o all Coca-Cola products, from Al Ahlia Gulf Line in the UAE
o 150 ml cans of Pepsi products, from Kuwait National Bottling Co
o VIMTO from Aujan in Saudi Arabia
o Other marginal products.

The franchise structure of the Omani market for carbonated soft drinks is as follows:

o Pepsi-Cola brands: Oman Refreshment Co. (Capital Area)

o Coca-Cola brands: Local sales subsidiary of Al Ahlia- Gulf Line General Trading Co. (UAE)

o Cott brands: National Beverages Co. (Capital Area)

o Own brands: Dhofar Beverage Co. (Salalah)
Ali Shaihani Juice Filling Industries (Capital Area)



B1.3 SOURCING


33
B1.3.1 LOCAL PRODUCTION MAIN SUPPLIER PROFILES

( i) Pepsi- Cola brands

Bottler: Oman Refreshment Co (ORC)

Brands: MOUNTAIN DEW, PEPSI, DIET PEPSI, 7-UP, DIET 7-UP, MIRINDA orange, apple, SHANI, EVERVESS club soda, ginger ale,
tonic water

Lines: cans: 150 ml, 355 ml
NRB: 330 ml, 355 ml
PET: 2.25 litre

ORC produces and markets all Pepsi brands available in Oman except 150 ml cans which are imported from Kuwait.

PEPSI TWIST was discontinued in mid-2004 due to disappointing sales.

In addition to its carbonates business, ORC also distributes Pepsis AQUAFINA water brand (see section B3) and its own
TOP FRUIT juice drink, which is not a Pepsi brand.



B1.3 SOURCING


34

( ii) Cott Brands ( Former Triarc Beverages Brands)

Bottler: National Beverages Co (NBC)

Brands: RC COLA, RC Q (citrus), ROYAL CROWN strawberry, tangerine, lemonade

Lines: NRB: 200 ml

In 2000, RC COLA and ROYAL CROWN brands in NRB were downsized from 355 ml to 200 ml, to be sold at the new price
point of 50 baiza per unit or OR 1 per case (compared to double that for Pepsi-Cola and Coca-Cola products). This
downsizing exercise provided significant sales growth for NBC, and subsequently the company stopped filling cans. It now
holds a unique niche with its 200 ml, 50 baiza products that appeal particularly to children.

In early 2004, NBC launched RC Q, a citrus carbonate aimed at consumers of MOUNTAIN DEW seeking a lower priced
product.

In November 2003 NBC launched a red flavoured carbonate, ROYAL CROWN vino, in an attempt to challenge the
market for VIMTO. However, the product was discontinued in 2004.



B1.3 SOURCING


35

( iii) Other brands

(a) Reem Beverage Industries

Brands: LAIMUNI

Lines: Cans: 300 ml

Part of the Omzest Group, Reem Beverage products were distributed by sister company Oman Agricultural Development,
a major fresh dairy. However, the arrangement did not work well and Reems sales declined steadily, with various brands
discontinued along the way. By 2003 LAIMUNI was the only available brand, but sales were negligible and all production
stopped before the end of the year. Reem stopped trading in 2004, although a spokesman claimed that
recommencement is planned though no date is fixed. At the time of research in early 2006, Reem had still not
resumed trading.


B1.3 SOURCING


36

(b) Dhofar Beverages Company (DBC)

Brands: AL KHALEEJ strawberry, lemon pineapple

Lines: NRB: 180 ml, 250 ml

DBC is situated in Omans second largest conurbation Salalah/Dhofar in the South of the country. It produces its own-
brand AL KHALEEJ carbonated soft drinks in 180 ml and 250 ml NRB in pineapple, strawberry, orange and lemon
flavours. Being unique, the pineapple flavour in 180 ml is the main seller while the company itself describes sales of its
250 ml bottles as very small.

DBCs main business is now DARBAT bottled water (see section B3). It also markets juice drinks under the AL KHALEEJ
brand.



B1.3 SOURCING


37

(c) Ali Shaihani Juice Filling Industries (JFI)

Brand: FIZZI cola, lemon, orange, tango
SHAMI lemon, pineapple, mixed fruit, strawberry

Lines: PVC 200 ml, 296 ml

Despite its name, JFI is primarily now a snack foods company and the CHIPS OMAN snack foods business is the core
operation. However, it is also the soft drinks producing arm of the Ali Shaihani group with products including FIZZI and
SHAMI carbonated soft drinks (filled in old-fashioned PVC bottles) as well as SHAMI, GIPSI and LULU juice drinks in
pouches and glass bottles. JFIs involvement in the beverage market has been in decline for some time, and carbonates
sales continue to be negligible. It is unclear why, and for how long, JFI will remain in the carbonates business.



B1.3 SOURCING


38
B1.3.2 IMPORTS MAIN SUPPLIER PROFILES

(i) Coca-Cola brands

Distributor: Al Ahlia Gulf Line

Brands: COCA-COLA, COCA-COLA LIGHT, QUWAT JABAL, FANTA , SPRITE, SCHWEPPES

Lines: Cans 150 ml, 330 ml, 355 ml
NRB 250 ml
PET 2.25 Litre

Coca-Cola supplies the Oman market from its facility in the UAE, Al-Ahlia Gulf Line (AGL), and sales are handled by an
AGL subsidiary in Oman.

Despite considerable investment in marketing in the early part of the decade, Coca-Cola has struggled to retain its
position in Oman and is now number three in the market, although in real terms it did perform better in 2005 than in
2004.



B1.4 BRAND/SUPPLIER SHARES


39
Table B6: Carbonated Soft Drinks, Total Supplier Shares, 2001-2005

Supplier Shares (%)
2001 2002 2003 2004 2005
Pepsi Beverages 72 79 81 83 84
Cott (RC brands) 7 9 9 9 9
Coca-Cola 21 12 9 7 6
Other
international
<1 <1 <1 <1 <1
Other local Neg Neg Neg Neg Neg
Total 100 100 100 100 100

Total (m litres)
137.7 119.8 123.2 130.6 141.9

Key Points:

Pepsi/ORC have gradually tightened their stranglehold
on the market. In large part this is due to the
MOUNTAIN DEW phenomenon: this single brand holds
a 44% share of the CSD sector and over 95% of the
citrus segment. However, Pepsi brands are also clear
leaders in every other major flavour segment.
Coca-Cola meanwhile has declined precipitously. The
reasons for this include the withdrawal of major
marketing subsidies from Coca-Cola International, the
disproportionate effect of anti-US sentiment (Coca-
Cola being seen as more American than Pepsi), and
the failure to significantly dent MOUNTAIN DEW and
the leverage it brings to other Pepsi brands. In
addition, Coca-Cola has been caught in a classic
squeeze between the heavily marketed leader (Pepsi)
and a cheaper fighting brand (RC), which has now
overtaken it.
The RC brands, distributed by National Beverages,
retail at half the price of the main CSD brands and
thus appeal to a different segment of consumers.
They have displaced Coca-Cola brands in many
outlets and maintained their position as second in the
market in 2005.




40
0
10
20
30
40
50
60
70
80
90
2001 2002 2003 2004 2005
Pepsi Beverages Coca-Cola Other



B1.5 PRICING AND DISTRIBUTION


41

Table B7: Carbonated Soft Drinks, Reference Brands Selected SKU Pricing, 2001-2005 (OR)

2001 2002 2003 2004 2005
Pepsi
MOUNTAIN DEW 355
ml can
0.100 0.100 0.100 0.100 0.100
2.25 litre PET 0.300 0.400 0.400 0.400 0.400
NBC/Cott RC COLA 200 ml NRB 0.050 0.050 0.050 0.050 0.050

Key Points:

The CSD market is subject to well established price points which are observed by most retail outlets. Thus a 355 ml can
of any brand typically retails at 100 baiza, while a 2.25 litre PET bottle retails at 400 baiza. However, the major
hypermarkets are more inclined to move away from these points and it is not uncommon here to find a 355 ml can of
MOUNTAIN DEW at 90 baiza or a 2.25 L PET bottle at 350 baiza.

Because of these price points, retail prices have stayed pretty stable in the years since the end of heavy price discounting
on PET. However, producer margins are coming under pressure due to rising raw material costs and some suppliers have
been forced to make slight increases to trade prices. Oman Refreshment Co. have increased the trade price of their cases
from OR 2.0 to OR 2.1.





42
Packed in 200 ml NRB, the RC brands can be retailed at a lower price point of 50 baiza, which is attractive to children
and poorer consumers. This strategy has clearly paid dividends and NBC has gained market share.

Carbonates are distributed through a wide range of channels from the largest hypermarket to the smallest bagala as well
as food service outlets. As a result, distribution of CSDs has been affected more than most soft drinks by the changing
retail environment and the decline in bagalas both in terms of numbers and quality of management (see section A). In
2005 the distribution pattern for carbonates was as follows:

o Around 25 30% of sales and rising were through the modern trade, particularly in the Capital Area where the
biggest hypermarkets and supermarkets are found.

o Some 60 65% of sales are still through the traditional trade, although there is little wholesaler involvement with
the main players distributing direct even to small stores. However, this share is clearly declining.

o The remaining 5% of sales were mostly through food service outlets, with very small volumes sold in some private
schools (CSD sales are banned in public schools) and through vending machines.



B1.6 FIVE-YEAR FORECASTS


43

Table B8: Carbonated Soft Drinks, Five-Year Forecasts, 2005-2010

2005 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010
Total 141.9 146.8 151. 4 155.7 159.6 163.4

3.4 3.1 2.8 2.5 2.4

Key Points:

After several turbulent years (e.g. anti-US boycott, price hikes on PET bottles etc.) the market for carbonates is steadily
approaching the consumption levels of 2000, where 147.2 million litres were consumed. Indeed with increased prosperity
in the country (high oil price) the market grew ahead of the population. To an extent this was a continued recovery from
the low of 2002, and future growth is thus forecast to be more moderate at an average of just under 3% per annum to
2010. One factor hindering any faster growth will be the decline in numbers of small shops due to the policy of
Omanisation. Increasing levels of health consciousness among the population may also slow down growth.


B2. JUICE PRODUCTS



44
Table B9 to B10 below summarise the development of the Oman juice products market during the period 2001-2005.

Table B9: Juice Products, Million Litres, 2001-2005

2001 2002 2003 2004 2005 2001 2002 2003 2004 2005
Consumption 54.3 59.6 65.2 71.9
1
79.3 38.9 9.8 9.4 10.3 10.3
Litres per capita 23.5 25.7 28.0 30.3 33.0 36.6 9.4 8.9 8.2 8.9

Table B10: Juice Products, Retail Value, 2001-2005

2001 2002 2003 2004 2005 2001 2002 2003 2004 2005
Market value 41.6 46.0 50.7 55.6 61.9 37.7 10.6 10.3 9.7 11.3
Sales per capita $ 18.01 19.83 21.76 23.46 25.80 35.4 10.2 9.7 7.8 10.0

1
2004 consumption figures have been revised in light of new information from one of the key suppliers.

B2. JUICE PRODUCTS



45
0
10
20
30
40
50
60
70
80
90
2001 2002 2003 2004 2005
M
i
l
l
i
o
n

L
i
t
r
e
s


B2. JUICE PRODUCTS



46
Key Points:

Juice products consumption in Oman has grown by an average annual rate of 9.9% since 2001 to reach 79.3 million
litres in 2005. In value terms, this is worth around US$ 61.9 million at retail level. Per capita consumption has grown
from 23.5 litres in 2001 to 33.0 litres by 2005.

Given this strong market growth, market value has also naturally grown significantly. However, underlying this strong
growth are two conflicting pressures:

o There is a steady shift in consumer preference towards product with a higher juice content (i.e. juices and nectars)
and away from juice drinks, with the former typically being more expensive for a similar pack size;
o However, sales of juices and nectars are more heavily biased towards larger pack sizes which offer a lower price
per litre than the small packs in which drinks are primarily sold. Moreover, juices and nectars are largely imported
and priced or promoted very competitively (some local companies would say dumped) while most drinks are
locally made.

The net result of these pressures has been that market value has actually grown very much in line with volume over the
review period.

As elsewhere, perceptions of juice products, and especially short-life juices, as being healthier than alternatives such as
carbonates are a key growth driver. Furthermore, trial and adoption of juice products has been encouraged by the
narrowed price differential with carbonates as juice products have been promoted heavily. Of course, the ban on
carbonates sales in schools provides a significant underpinning to the juice drinks market.

B2. JUICE PRODUCTS



47
Long life Short life
B2.2.1 SHELF LIFE

Table B11: Juice Products, by Long-life and Short-life, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Long-life 43.9 46.7 45.8 49.8 53.8 5.2 37.2 6.4 -1.9 8.7 8.1
Short-life 10.4 12.9 19.4 22.1 25.5 25.1 46.5 24.0 50.4 13.9 15.4
Total 54.3 59.6 65.2 71.9 79.3 9.9 38.9 9.8 9.4 10.3 10.3

Share of Total (%)
2001 2002 2003 2004 2005
Long-life 80.8 78.4 70.2 69.2 67.8
Short-life 19.2 21.6 29.8 30.7 32.2
Total 100.0 100.0 100.0 100.0 100


B2. JUICE PRODUCTS



48

Key Points:

Long-life products continue to dominate the Oman market accounting for over two-thirds of juice product sales in 2005.
The mainstay of this sector is single-serve carton drinks, which are widely consumed by children and particularly at
school (around 40% of single-serve aseptic cartons sales are in schools). More generally, however, long-life products
have obvious advantages in terms of distribution in storage in a country where the cold chain is still not fully developed,
and particularly in the interior.

The main growth, however, is coming from short-life products, which showed average annual growth of 25% over the
review period. Consumers perceive short-life products to be healthier than long-life, and aggressive pricing and
promotions have encouraged their adoption.


B2. JUICE PRODUCTS



49
Juices Nectars Fruit/flavoured drinks
B2.2.2 PRODUCT TYPE

Table B12: Juice Products, by Product Type, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Juices 8.0 10.2 13.5 15.2 16.0 18.9 66.7 27.5 32.3 12.6 5.3
Nectars 4.3 5.8 8.0 9.6 10.7 25.6 79.2 34.9 37.9 20.0 11.5
Fruit flavoured drinks 42.0 43.6 43.7 47.1 52.6 5.8 31.7 3.8 0.2 7.8 11.7
Total 54.3 59.6 65.2 71.9 79.3 9.9 38.9 9.8 9.4 10.3 10.3

Share of Total (%)
2001 2002 2003 2004 2005
Juices 14.7 17.1 20.7 21.1 20.2
Nectars 7.9 9.7 12.3 13.4 13.5
Fruit Flavoured drinks 77.3 73.2 67.0 65.5 66.3
Total 100 100 100 100 100


B2. JUICE PRODUCTS



50

Key Points:

All three product types enjoyed strong growth between 2001 and 2005. The industry regards 2001, which saw
exceptional growth, as a year of adjustment in which consumption of juice products in Oman moved much more into
line with that in other regional countries.

Juice drinks dominate the market, accounting for 66% of consumption in 2005, although this dominance is steadily
diminishing. Juice drinks did however show a slight increase in their share of the market, due in no small part to the
strong growth of Aujans RANI drink and RANI float.

Juices and nectars combined have grown to 34% of the market; there is little evidence that consumers differentiate
between these two product types since different flavours under the same brand will vary between one and the other, the
difference being largely down to production necessities rather than market needs. They have continued to enjoy strong
growth, although the rate has naturally slowed as the market base has increased.


B2. JUICE PRODUCTS



51
B2.2.3 PACK TYPE AND SIZE

Table B13: Juice Products, by Pack Type and Size, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Single-serve 44.1 47.9 50.1 54.4 60.7 8.3 34.0 8.6 4.6 8.6 11.6
Aseptic carton 24.5 26.5 28.8 31.2 32.6 7.4 45.8 8.2 8.7 8.3 4.2
Cups 6.6 5.7 4.5 2.6 2.7 (20.0) 3.1 -24.2 -21.0 -42.2 3.8
NRB 4.0 4.2 3.6 2.8 2.9 (7.7) 14.3 5.0 -14.3 -22.2 -17.1
Cans 1.9 2.1 1.9 5.1 7.0 38.5 18.8 10.5 -9.5 168.4 37.3
HDPE 2.4 2.2 2.8 3.9 3.7 11.4 118.2 -9.3 27.3 39.3 -5.1
PET 0.7 3.3 4.3 5.3 6.6 75.2 NA 371.4 30.3 23.3 24.5
Pouches 0.4 0.5 0.8 0.8 0.8 18.9 - 25.0 60.0 0.0 0.0
Short-life carton 3.6 3.4 3.4 2.7 4.3 4.5 16.1 -5.5 - 20.6 59.3
Take-home 10.2 11.7 15.1 17.5 18.6 16.2 64.5 14.7 29.1 15.9 6.3
Aseptic carton 4.0 4.7 3.2 4.4 4.1 0.6 42.9 17.5 -32.0 37.5 (6.8)
HDPE 3.4 4.4 8.8 10.6 9.6 29.6 54.5 29.4 100.0 20.5 9.4
PET 1.8 2.2 2.3 2.4 4.8 27.8 260.0 22.2 4.5 4.3 100.0
NRB - - - Neg Neg Neg - - - - -
Short-life carton 1.0 0.4 0.8 0.1 0.1 (43.8) 42.9 -60.0 100.0 -87.5 0.0
Total 54.3 59.6 65.2 71.9 79.3 9.9 38.9 9.8 9.4 10.3 10.3


B2. JUICE PRODUCTS



52
Share of Total (%)
2001 2002 2003 2004 2005
Single-serve 81.2 80.4 76.8 75.7 76.5
Aseptic carton 45.1 44.5 44.2 43.4 41.2
Cups 12.2 9.6 6.9 3.6 3.4
NRB 7.4 7.0 5.5 3.9 3.7
Cans 3.5 3.5 2.9 7.1 8.8
HDPE 4.4 3.7 4.3 5.4 4.7
PET 1.3 5.5 6.6 7.4 8.3
Pouches 0.7 0.8 1.2 1.1 1.0
Short-life carton 6.6 5.7 5.2 3.8 5.4
Take-home 18.8 19.6 23.2 24.3 23.5
Aseptic carton 7.4 7.9 4.9 6.1 5.2
HDPE 6.3 7.4 13.5 14.7 12.1
PET 3.3 3.7 3.5 3.3 6.1
NRB - - - - -
Short-life carton 1.8 0.7 1.2 0.1 0.1
Total 100 100 100 100 100


B2. JUICE PRODUCTS



53

Key Points:

Single serve packs (i.e. 500 ml or below) account for over 76% of the volume sold. However, until 2004 the market
share of take home packs had been growing steadily, and reached 24.3% in 2004 as compared to 19% in 2001.
Although having grown in real terms, the share of take home products did decline slightly in 2005. This was due to the
strong growth of Aujans single serve drink products (RANI drink, RANI float, HANI)

The single serve aseptic carton remains by far the most important pack type with a market share of just over 41%. This
is of course the key pack for juice drinks and is used by several key local manufacturers as well as being supplied by
importers. When take home sizes are added to this, aseptic cartons account for 46% of the total market.

The second most important packaging material is HDPE plastic which makes up 17% market share. Some 52% of take
home volume is packed in HDPE, although it is much less important for single serve sales, with just over 6% of single
serve juice products being in HDPE. Usage of HDPE has grown by over 23% per year on average over the review period.

Interestingly, however, usage of PET packaging is growing still quicker, albeit from a smaller base. Key local supplier
Oman National Dairy Products (ONDP) began a move into PET in 2004, while several imported brands (both long and
short-life) are also packed in it. The total market share of PET was 14.4% in 2005. The difference between PET and HDPE
and aseptic cartons seems to be reducing.


B2. JUICE PRODUCTS



54

Obviously while these pack types are increasing their share, other pack types must be in decline. The biggest loser has
been plastic cups, volumes in which have declined in real terms by over 20% per year on average. Two previously
significant suppliers have disappeared from the market entirely (Allied Beverages and Reem Beverages) and only Dhofar
Beverages (KHALEEJ) continues to sell significant volumes in this pack type.

Short-life cartons have also declined in absolute terms, mainly owing to ONDP withdrawing its 1 litre gable top carton in
2003. Non-returnable glass bottles and cans have both declined in relative terms, with volumes broadly steady in a
growing market.

B2. JUICE PRODUCTS

B2.3 SOURCING


55
B2.3.1 LOCAL V. IMPORTS

Table B14: Juice Products, Local vs Imports, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Local 33.4 35.1 36.8 37.4 43.4 6.8 35.8 5.1 4.8 1.6 16.0
Import 20.9 24.5 28.4 34.5 36.0 14.5 44.1 17.2 15.9 21.4 4.3
Total 54.3 59.6 65.2 71.9 79.3 9.9 38.9 9.8 9.4 10.3 10.3

Key Points:

The period 1999 to 2001 saw rapid expansion in local production of juice products and in particular from Oman National
Dairy Products. At this time, self-sufficiency in the market exceeded 60%. Subsequently, however, suppliers from Saudi
Arabia and the UAE have targeted the Omani market increasingly aggressively, and growth in imports has outstripped
that in local supply. Local production did grow faster than imports in 2005 however, largely due to the continued
expansion of Oman National Dairy and Dhofar Cattle Feed. By 2005, local products made up 55% of the ma rket.

B2. JUICE PRODUCTS

B2.3 SOURCING


56

Somewhat paradoxically, imports are most important for short-life products, with leading regional dairies such as
Almarai, Al Rawabi and Unikai all significant suppliers of short-life juices in HDPE bottles. The local companies, notably
ONDP, National Beverages and Oman Refreshments are the major suppliers of long-life drinks in aseptic packs. Of
course, this is not to say that local suppliers do not supply short-life juices and there are no imports of long-life products;
on the contrary, ONDP is very important in short-life juice, for example, and Aujan is a key supplier of long-life drinks
(RANI) from both Dubai and Saudi Arabia.


B2. JUICE PRODUCTS

B2.3 SOURCING


57

(i) National Beverages Co Ltd (NBC), Ruwi

Brands: SUNTOP, ROYAL MANGO

Lines: Aseptic cartons: 125 ml, 250 ml
NRB: 200 ml

NBC produces SUNTOP drinks in single-serve aseptic cartons under licence from Co- Ro Foods, Denmark, and holds the
franchise for the Omani and UAE markets. SUNTOP is market leader in the important drinks segment. SUNTOP was
unavailable in the market during the first quarter of 2006 due to the boycott on Danish products. It was however re-
introduced in April 2006.

The smaller sized 125 ml aseptic cartons of SUNTOP were launched in April 2003. The cartons retail at an attractive 50
baizas, compared with a usual price point of 100 baizas for the standard 250 ml size. The 125 ml carton accounts for
around 30% of SUNTOP unit sales.

Schools remain one of the most important channels for NBC, with around 25% of their SUNTOP sales derived from school
contracts. This area of business has been helped by the Ministry of Health initiative that targets schools and discourages
carbonates consumption.


B2. JUICE PRODUCTS

B2.3 SOURCING


58

In September 2004, NBC re-introduced ROYAL MANGO drink in a 200 ml glass bottle selling at 50 baiza, a brand which
had been discontinued some years previously. This product replaced NBCs own brand of mango drink (GOGO) which was
itself only launched in October 2003. Apparently, NBC found the manufacturing cost of GOGO to be too high to retail at
the key 50 baiza price point.

In addition to their manufacturing interests in juices and carbonates (RC COLA and ROYAL CROWN), NBC is also the
distributor for SUNQUICK squashes and until March 2005 was the distributor for MASAFI bottled water. NBC launched its
own brand of water, DIMA, in July 2005.


B2. JUICE PRODUCTS

B2.3 SOURCING


59
(ii) Oman National Dairy Products Co (ONDP), Ruwi

Brands: FUN NAN, TAMAM long-life drinks
ZAIN long-life juices
ZAIN short-life juices
ZINGO short-life drinks

Lines: aseptic cartons: 125 ml, 200 ml, 250 ml, 1 litre
gabletop cartons:225 ml
PET: 250 ml, 500ml, 1 litre, 2 litre

ONDP has one of Omans largest distribution networks for chilled products, reaching over 5,000 outlets across the
country, in a range of channels in retail and food service. While ONDP distributes its short-life products itself, the
distribution of its long-life products is handled by Al Ahlia Gulf Line.

The company uses a wide variety of pack types, including aseptic cartons from both Tetra Pak and Combibloc, and gable
top cartons from Elopak. It launched a long-life PET pack in July 2004 (long-life drinks) and converted its 250 ml short-
life juice from HDPE to PET in November 2004.

The combined sales of TAMAM and FUNNAN drinks in aseptic cartons, plus ZAIN long-life drinks and ZINGO short-life
drinks make ONDP number two in the juice drinks market, narrowly behind SUNTOP.

ONDP is the leading local manufacturer of short-life juices, although outsold in the market by Al Rawabi.

ONDP remains an export focused company with more than half of their total production sold outside their domestic
market.

B2. JUICE PRODUCTS

B2.3 SOURCING


60

(iii) Dhofar Beverages Co (DBC), Salalah

Brands: AL KHALEEJ

Lines: Aseptic cartons: 250 ml
NRB: 200 ml
Cups: 200 ml

DBC markets its own AL KHALEEJ brand of juice drinks in three pack types (the brand is also used for a carbonates
range). The product comes in several unusual flavours including guava and kiwi-lime.

The brand was originally available only in cups, and this remains the most important pack type despite the subsequent
introduction of aseptic cartons and glass bottles. Indeed, AL KHALEEJ is the clear leader in the dwindling cups market.

The company also produced MAAZA brand juice drinks under a franchise agreement until late 2003, but volumes had
been in decline for several years and this agreement was ended.

Bottled water is a far more important aspect of DBCs business in volume terms and the company have aggressively
developed their DARBAT brand. DBC also distribute several other beverage brands, including SHARK energy drinks, but
volumes are small.


B2. JUICE PRODUCTS

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61

(iv) Dhofar Cattle Feed Co, Salalah (DCF)

Brand: A'SAFWAH

Line: HDPE: 250 ml, 2 litre

In August 2001, the fresh dairy operation DCF started production of short-life juice in 250 ml, 1 litre and 2 litre HDPE
bottles under its main brand A'SAFWAH. Although strongest in Salalah itself, the new brand also quickly penetrated the
Capital Area through the already existing short-life dairy distribution network of DCF.

Sales of the ASAFWAH brand have grown strongly since 2001 and it is second only to ONDP as a local producer of short-
life juices and nectars.

Take-home packs account for around 60% of sales.

B2. JUICE PRODUCTS

B2.3 SOURCING


62

(v) Oman Refreshment Co (ORC), Ruwi

Brand: TOP FRUIT

Line: aseptic cartons: 250 ml

ORC is primarily known as the Pepsi bottler, but since 1997 it has also produced a range of juice drinks in three flavours
under the TOP FRUIT brand, filled in 250 ml International Paper aseptic cartons.

TOPFRUIT is distributed alongside Pepsi Beverages carbonates and bottled water. Pepsi Beverages allows ORC to display
TOPFRUIT in Pepsi-branded vizicoolers.

However, TOP FRUIT is not primarily a retail brand but is orientated more to sales through schools, allowing ORC to take
a share of this market where carbonates are banned.


B2. JUICE PRODUCTS

B2.3 SOURCING


63

(vi) Ali Shaihani Juice Filling Industries (JFI), Ruwi

Brands: LULU, SHAMI, GIPSI, BARAD BARAD

Lines: cups: 200 ml
NRB: 250 ml
pouch: 200 ml

JFI is primarily a snack foods business focused on its CHIPS OMAN range and its beverage range remains very much a
sideline. Indeed, it would be no surprise to see JFI withdraw from the beverage market completely.

The cup drinks LULU and BARAD BARAD are in fact artificial fruit flavoured drinks and have no fruit juice content, which
rules them out of school sales. They have mainly sold through bagalas, a retail sector that is declining in Oman, so
distribution is increasingly problematic.

GIPSI pouch drink does contain juice and is approved for school sale. It sells at the key 50 baize price point. SHAMI is a
mango flavoured drink in NRB.


B2. JUICE PRODUCTS

B2.3 SOURCING


64

(vii) Reem Beverage Industries

Brands: NAKHAL, SUN UP

Lines: HDPE: 250 ml, 2 litre
Cups: 200 ml

Part of the Omzest Group, Reem Beverage products were distributed by sister company Oman Agricultural Development,
a major fresh dairy. However, the arrangement did not work well and Reems sales declined steadily, with various brands
discontinued along the way. Reem ceased trading in 2004, although a spokesman did claim at the time that
recommencement is planned though no date is fixed. At the time of research in early 2006, Reem had still not resumed
trading.


B2. JUICE PRODUCTS

B2.3 SOURCING


65

(i) Aujan Industries Company
(Production in Saudi Arabia and Dubai)

Brands: RANI drink, RANI float, HANI drink

Lines: Aseptic cartons: 250 ml
Cans: 180 ml, 240 ml
NRB: 200 ml
PET: 250 ml, 1.5 litres

Aujan produces and markets five branded ranges of juice products in Saudi Arabia, but RANI is clearly the key product in
the Oman market. It is available in two forms: RANI drink and RANI float, the former being imported from Saudi Arabia
and the latter from Dubai.

RANI is available in three can sizes, aseptic cartons, non-returnable glass bottles and PET bottles in orange, pineapple
and peach flavours.

HANI is targeted at 6-12 year old children and has a boy hero theme. It is available only in 250 ml PET bottles and is
imported from Saudi Arabia.


B2. JUICE PRODUCTS

B2.3 SOURCING


66

(ii) Almarai Company Limited
(Production in Saudi Arabia)

Brand: ALMARAI juice/nectar/drink

Lines: Aseptic cartons: 200 ml, 1 litre
HDPE: 200 ml, 2 litres

ALMARAI produce both long-life and short-life juice products but are best known in the Oman market for their short-life
range of juices and nectars sold in HDPE.


B2. JUICE PRODUCTS

B2.3 SOURCING


67

(iii) National Food Products Company, Sharjah and Abu Dhabi (NFPC)

Brands: long-life: LACNOR (aseptic juice/nectar), SUNY (aseptic drink), MILCO (aseptic drink), GUMBA (aseptic nectar)

Lines: aseptic cartons: 200 ml, 250 ml, 1 litre FT

NFPC is a holding company with five separate divisions, two of which supply juice products:
- Milco (Abu Dhabi) for short-life dairy and juice products
- Al Buheira Lacnor (Sharjah) for long-life dairy and juice products

NFPC remains the largest producer of juice products in volume terms in the UAE.

NFPC has a substantial distribution operation established in Oman, and is significant in both long and short-life juices.


B2. JUICE PRODUCTS

B2.3 SOURCING


68

(iv) Arab Beverages, Dubai

Brands: long-life: CAPRI SONNE (two versions: 12% fruit content drinks for retail, 30% nectars for school sales only)

Lines: 200 ml aluminum pouches

Arab Beverages manufactures CAPRI SONNE juice drinks in Dubai under licence of the flavourings company Rudolf Wild
of Germany.

CAPRI SONNE nectars continue to be sold exclusively in schools while CAPRI SONNE fruit drinks are distributed through
retail channels (primarily in A class supermarkets).

In 2004, Arab Beverages ended its distribution arrangement with WJ Towell, and opted to establish its own distribution
company Al Accad Trading (Accad being the family name of Arab Beverages owners).

B2. JUICE PRODUCTS

B2.3 SOURCING


69

(v) United Kaipara Dairies Co (Unikai), Dubai

Brands: long-life: UNIKAI (aseptic juice/nectar/drink)
short-life: MOROUJ (HDPE juice/nectar), AREEJ (gabletop drink)

Lines: Aseptic cartons: 250 ml, 1 litre resealable
Gabletop cartons: 225 ml
HDPE: 250 ml, 2 litre
Cups: 225 ml

In the juice sector, the artificially flavoured AREEJ short-life drink in single-serve gabletop cartons continues to be
Unikais top brand in the Oman market. However, the company is also significant in short-life juices and nectars under
the MOROUJ brand.

(vi) Al Rawabi Dairy, Dubai

Brands: short-life: AL RAWABI (HDPE/PP and PET juice/nectar/drink),

Lines: HDPE: 200 ml, 1 litre, 2 litre
PET: 200 ml, 250 ml, 500 ml

Al Rawabi Dairy has a significant presence in short-life juices packed in HDPE, being the first to introduce the product and
pack type. The company did experience some problems with its distribution arrangements in 2005 and these led to a
decline in sales. These problems have now been resolved however, and sales are expected to recover in 2006. SAMBA a
fighting brand was discontinued in 2005 due to disappointing sales.

B2. JUICE PRODUCTS



70
Table B15: Juice Products, Total Supplier Shares, 2001-2005
Supplier Shares (%)
2001 2002 2003 2004 2005
ONDP 24 22 20 20 22
NBC 19 18 18 17 17
Aujan 9 8 7 10 13
Al Rawabi 4 6 8 9 7
Unikai 7 7 8 7 7
ORC 6 6 5 6 6
Almarai 4 4 4 5 6
Dhofar Beverages 7 6 5 4 4
DCF Neg 2 3 3 3
Other local 6 5 5 2 2
Other imports 14 16 17 17 13
Total 100 100 100 100 100

Total (m litres) 54.3 59.6 65.2 71.9 79.3
Key Points:

With its broad product range (juices, nectars, drinks;
short and long-life) ONDP has retained market
leadership since 2001 with its ZAIN, FUNNAN, TAMAM
and ZINGO brands.
NBCs position is essentially based on a single
product, SUNTOP, which is the leader in juice drinks.
As the importance of drinks declines in relative terms,
NBC will struggle to retain overall market share. Its
share is expected to decline significantly in 2006
because of the boycott on Danish products.
Al Rawabi is the leading imported brand, and clear
leader in short-life juices and nectars segment,
outselling ONDP in these products. Its market share
declined in 2005 due to distribution related problems.
Almarai, another importer of premium juice products
is showing steady growth.
Aujans RANI drink comes in a wide variety of pack
types (PET, NRB, can, carton) doubtless contributing
to its success.

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71

Table B16: Juice Products, Reference Brands Selected SKU Pricing, 2001-2005 (OR)

2001 2002 2003 2004 2005
SUNTOP drink 250 ml aseptic carton 0.100 0.070 0.095 0.090 0.090
ZAIN l/l juice 1 L aseptic carton 0.500 0.390 0.390 0.390 0.390
MOROUJ s/l juice 250 ml HDPE 0.120 0.110 0.110 0.110 0.110
Al Rawabi s/l juice 2 L HDPE 0.800 0.790 0.850 0.850 0.850
RANI drink 180 ml can 0.100 0.090 0.095 0.095 0.095
RANI drink 200 ml NRB 0.090 0.090 0.080 0.090 0.090
CAPRI SONNE
drink
200 ml pouch
(10 x pack)
0.850 0.850 0.850 0.850 0.900
ZAIN s/l juice 250 ml PET - - - - 0.090-0.100
ZAIN s/l juice 2L PET - - - - 0.520-0.530


B2. JUICE PRODUCTS



72
Key Points:

As is evident from the table, base prices have generally seen little variation over the last five years. However, there have
been periods of intensive price promotions, band on offers and BOGOFs
1
reducing the price per litre for some juice
products very dramatically.

For example, at one point in 2004 ONDPs ZAIN short-life juice was selling at OR 0.850 for 2 x 2 litre HDPE packs, with
competitors such as ASAFWAH and AL RAWABI priced broadly similarly.

It is now understood that the major juice product producers and importers have reached an informal agreement to
control pricing, and that this brought an element of stability to the market in the latter part of 2004 and through 2005.

Distribution of short-life products clearly requires a developed cold chain, and this to some extent restricts them to the
major urban areas. However, with the rapidly increasing strength of the hypermarkets and supermarkets this limitation
on growth is rapidly disappearing.

Sales of multi-serve (or take home) packs are also largely limited to the largest outlets and similar comments on their
increasing availability apply.

Single serve items are distributed much more widely, and are available in bagalas and other small outlets throughout the
country including in the Interior. A further significant channel is school sales, which account for around 40% of single
serve aseptic carton sales (carbonates, and juice products in cans and glass bottles all being banned). School contracts
are tendered and usually specify cartons.

1
Buy One Get One Free
I MES Consulting Group - Middle East Non- Alcoholic Beverages 2006 - Oman

B2. JUICE PRODUCTS



73

Table B17: Juice Products, Five-Year Detailed Forecasts, 2005-2010

2005 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010
Single-serve 60.7 64.7 68.6 72.2 75.9 78.6 6.7 6.0 5.3 5.1 3.6
Multi-serve 18.6 20.2 21.8 23.5 25.3 26.9 8.4 8.1 8.0 7.4 6.5
Total 79.3 84.9 90.4 95.8 101.2 105.5 7.1 6.5 5.9 5.7 4.3

Key Points:

Juice products are expected to continue to grow strongly as consumer awareness of health issues grows and the
distribution of a wider range of juice products increases. The rate of growth will, however, slow a little as the market
base becomes larger.

Take home products are expected to grow more quickly than the single serve sector,, with juices and nectars the key
growth drivers for the larger packs. However, even by 2010 take home packs are only forecast to reach 26% of the
market as compared to 25% in 2005.


B3. PACKAGED WATER



74

Table B18 to B19 below summarise the development of the Oman packaged water market during the period 2001-2005.

Table B18: Packaged Water, Million Litres, 2001-2005

2001 2002 2003 2004 2005 2001 2002 2003 2004 2005
Consumption 121.8 132.9 143.4 154.5 170.8 21.7 9.1 7.9 7.7 10.6

Table B19: Packaged Water, Retail Value, 2001-2005

2001 2002 2003 2004 2005 2001 2002 2003 2004 2005
Market value 23.3 24.6 25.1 25.4 26.2 8.8 5.6 2.0 1.2 3.1
Sales per capita $ 10.08 10.60 10.77 10.72 10.92 6.9 5.1 1.6 (0.5) 1.9


B3. PACKAGED WATER



75
0
20
40
60
80
100
120
140
160
180
2001 2002 2003 2004 2005
M
i
l
l
i
o
n

L
i
t
r
e
s


B3. PACKAGED WATER



76
Key Points:

Packaged water consumption in Oman has grown by an average annual rate of 8.8% since 2001 to reach 170.8 million
litres in 2005. In value terms, this is worth around US$ 26.2 million at retail level. Per capita consumption has grown
from 52.7 litres in 2001 to 71.2 litres by 2005.

Market value, however, has grown by an average of just 3.0% per annum over this period. This reflects a number of
factors:

o The growing importance of dispenser water with its lower value per litre
o A gradual shift to larger sizes within the bottled water segment
o Downward pressure on prices due to increased competition between local and imported brands
o The impact of the Aquafina launch in 2004 (see below).

Lower prices have encouraged marginal consumers to enter the market, and existing users of packaged water to increase
their consumption, so that per capita consumption levels have grown steadily.

I MES Consulting Group - Mi ddl e East Non- Al cohol i c Beverages 2006 - Oman

B3. PACKAGED WATER

B.3.2 KEY SEGMENTATIONS

77

B3.2.1 BOTTLED V. DISPENSER

Table B20: Packaged Water, Bottled v. Dispenser, Million Litres, 2001-2005

2001 2002 2003 2004 2005 2001 2002 2003 2004 2005
Bottles 90.6 98.5 106.1 111.8 127.8 21.0 8.7 7.7 5.4 14.3
Dispenser 31.2 34.4 37.3 42.7 43.0 23.8 10.3 8.4 14.5 0.7
Total 121.8 132.9 143.4 154.5 170.8 21.7 9.1 7.9 7.7 10.6

Key Points:

Bottled water consumption has grown at an average of 9.0% per annum over the period, while growth in dispenser water
has slowed to 8.3% per annum.

After years of a decline in the growth rate of bottled water, there was an increase in 2005. The growth rate of dispenser
water showed a significant decline, which is discussed below.


B3. PACKAGED WATER


78

From its origins in the mid-1990s, dispenser water grew gradually to 2000. Until then offices and other businesses were
really the only users, but the only two suppliers (National Mineral Water and Oasis Water Company) then began to target
household consumption providing a fillip to growth. Although these companies started to deliver directly to private
residences, sales via neighbourhood bagalas, who also delivered dispenser containers as a customer service, became an
important secondary channel.

However, dispenser waters share of the market declined in 2005. This was due to a number of reasons:

Al Mazyonas MAJAN brand, which made up a significant share of the dispenser water market was out of
production for the first five months of the year.

Many of the imported bottled water brands such as AQUAFINA and ARWA promoted their products heavily by
offering free bottles of water (e.g. 12 bottles plus 4 free). These offers provoked National Mineral Water into
offering similarly competitive responses.

Many retail outlets such as Carrefour, Sultan Centre and Lulu, entered the market with their own brand
bottled waters, often selling at a discount price.

Also in 2000, the Government issued only its third licence for local water production to Al Mazyona Mineral Water
Company (AMW). The entry of a third producer stirred up the ma rket and generated additional growth. By 2004, at least
10 other companies had entered the market (some of which have since left) although the quality of their water is
reportedly suspect. The major companies have made representations on this point to the authorities, but feel that
Government is more concerned with the job creation prospects of these companies than a perceived but unproven health
risk.

B3. PACKAGED WATER


79

B3.2.2 STILL V. SPARKLING

Table B21: Packaged Water, Still v. Sparkling, Million Litres, 2001-2005

2001 2002 2003 2004 2005 2001 2002 2003 2004 2005
Still 121.7 132.8 143.3 154.5 170.7 21.7 9.1 7.9 7.7 10.5
Sparkling 0.1 0.1 0.1 0.1 0.1 - - - - -
Total 121.8 132.9 143.4 154.5 170.8 21.7 9.1 7.9 7.7 10.6

Key Points:

As is evident from the table, sparkling water is a marginal product in Oman. Demand is essentially restricted to Western
expatriates and food service outlets (hotels and better quality restaurants) catering to tourists. Even in Muscat, only the
few largest supermarkets stock sparkling water, while the product is rarely found outside the Capital Area.

Producers of still water believe that taste is of fundamental concern to consumers. It is felt that there is a clear
preference for genuine spring waters. Indeed, leading brands such as EL JABAL AL AKHDAR do have a slightly sweet
taste as a result of their mineral content. Nevertheless, it is also clear that this preference is insufficient to command a
significant price premium, as is evident from the long term decline in supplier share of National Mineral Water brands.

B3. PACKAGED WATER


80

B3.2.3 PACKAGING

Table B22: Packaged Water, by Pack Type, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Plastic:
< 1.5 litre 28.5 31.0 37.9 33.2 33.8 4.4 (7.5) 8.8 22.2 (12.4) 1.8
1.5 5 litre 62.0 67.4 68.1 78.5 93.9 10.9 40.9 8.7 1.0 15.3 19.6
5 + litres (inc.
dispenser)
31.2 34.4 37.3 42.7 43.0 8.3

23.8 10.3 8.4 14.5 0.7
Glass 0.1 0.1 0.1 0.1 0.1 - - - - - -
Total 121.8 132.9 143.4 154.5 170.8 8.8 21.7 9.1 7.9 7.7 10.6


B3. PACKAGED WATER


81

Share of Total (%)
2001 2002 2003 2004 2005
Plastic:
< 1. 5 litre 23.4 23.3 26.4 21.5 19.8
1.5 5 litre 50.9 50.7 47.5 50.8 55.0
5 + litres (incl.
dispenser)
25.6 25.9 26.0 27.6 25.2
Glass 0.1 0.1 0.1 0.1 0.1
Total 100 100 100 100 100

Key Points:

The main pack type for water is the 1.5 litre PET bottle which accounts for over half of all water sold, equating to over 61
million bottles. Note that the 55.0% includes NMWs 2 litre pack, although this represents just a fraction of the total.

Dispenser water (including small volumes of NMWs 6 litre pack) has steadily been increasing in importance, reaching
43.0 million litres in 2005. However, as discussed previously, dispenser water only registered marginal growth in 2005
(0.7%).

B3. PACKAGED WATER


82

While sales of smaller plastic pack sizes (<1.5 litres) have held broadly steady in volume terms over the period, they
have clearly declined in relative importance over the past year. Closer examination of the data shows that it is in fact the
smallest sizes (200 and 250 ml cups) that have declined, while 500 ml PET bottles have shown some slight growth. This
appears to have two main reasons:

- the relatively high price per litre of water packed in these small sizes

- supply-side issues, notably the loss of distribution by major suppliers of imported water cups (e.g. GULFA)

Glass bottles are used almost exclusively for sparkling water, all brands of which are imported.


B3. PACKAGED WATER

B3.3 SOURCING


83

Table B23: Packaged Water, Local v Imports, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Local bottles 50.8 64.0 75.0 70.5 75.1 10.3 93.2 26.0 17.2 (6.0) 6.5
Import bottles 39.8 34.5 31.1 41.3 52.7 7.3 (18.1) (10.8) (9.9) 32.8 27.7
Dispenser (local) 31.2 34.4 37.3 42.7 43.0 8.3 23.8 10.3 8.4 14.5 0.6
Total 121.8 132.9 143.4 154.5 170.8 8.8 21.7 9.1 7.9 7.7 10.6

Key Points:

Historically, the Governments reluctance to issue additional local production licences encouraged suppliers from outside
Oman, and most notably in the UAE, to develop their sales in the Omani market, so that imported brands dominated the
market. Only once a second local licence was granted did the share of the market held by local production overtake
imports in 2001.

By 2005, locally packaged water had a 69% market share in total (i.e. including dispenser water, all of which is local).
Locally bottled water had a 59% share of the bottled water market, which is down from a peak of 71% in 2003.

B3. PACKAGED WATER

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84

There are two main reasons for the loss in share of locally bottled water:

o Pepsis AQUAFINA has been expanding its distribution and presence in the market, particularly in the foodservice
sector. It is imported to Oman from Dubai.

o In mid 2004, Coca-Cola switched sourcing of its bottled water from contract packing locally by National Mineral Water
to imports (this tied in with a re-branding exercise from RIWA to ARWA).

Other imported brands lost ground, but their decline in importance was more than offset by the additional imported
volumes from AQUAFINA and ARWA.


B3. PACKAGED WATER

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85

(i) National Mineral Water Company (NMW)

Brands: TANUF, EL JABAL EL AKHDAR, ASSAHA (bottled water and cups)
SALSABEEL (5 gallon water, 2 litre and 6 litre PET)

Lines: PET: 500 ml, 1.5 litre, 2 litre, 6 litre
cups: 250 ml (PET cups)
5 gallon polycarbonate

NMW is by far the largest, and longest established, producer of drinking water in the country, supplying over 40% of all
packaged water consumed in Oman in 2004. The company relocated to new premises in the Ghala area of Muscat in
August 2004.

NMW markets water under four separate brands.

Its leading brand, indeed still overall market leader in bottled water, is EL JABAL EL AKHDAR. This is a natural spring
water with a slightly sweet taste which is liked by Omani consumers. It is available in 250 ml cups and 500 ml and 1.5 L
PET bottles. EL JABAL EL AKHDAR also has the contract to supply all international airlines departing from Muscat.


B3. PACKAGED WATER

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86

ASSAHA (500 ml and 1.5 L PET bottles only) is a fighting brand and is sold predominantly in the Omani interior. Due to
its focus on the interior, ASSAHA has become NMWs fastest growing brand, although this has been at the expense of a
squeeze on profit margins.

The flagship TANUF water is positioned as a premium brand, and is concentrated on the urban markets of the Capital
Area and Salalah but is also used for exports. It is claimed that TANUF is the preferred choice of brand for the Royal
Palace. Like EL JABAL EL AKHDAR, it is a natural spring water and is packed in 250 ml cups, 500 ml and 1.5 L PET
bottles. However, in the price competitive environment of 2005 TANUF has seen a slight loss in market share.

SALSABEEL was NMWs brand for dispenser water only until January 2001, when a 5 litre PET pack was introduced. In
July 2003 this product was upsized to 6 litres and a new 2 litre line of the brand was also introduced. NMW believes that
these larger sizes hold the greatest potential for increasing future sales and is increasingly switching its emphasis to
them.

Until mid-2004, NMW were packing RIWA, Coca-Colas own brand of water, under contract. However, Coca-Cola decided
to re-brand this product as ARWA and in tandem with this switched to importing the product. Al Ahlia, Coca-Colas sales
distributor in Oman, handles the distribution and promotion of ARWA.


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87

(ii) Oasis Water Co

Brand: OASIS

Line: 6 litre PET, 5 gallon polycarbonate

Oasis Water Company, a subsidiary of Zubair Corporation, is not linked to the company of the same name which forms
part of NFPC/Lacnor in the UAE. It is understood that there was an earlier agreement between the two companies in
place, but that there is no longer any tie-up.

OASIS water is purified water, as opposed to NMWs SALSABEEL, which is marketed as spring water. Nevertheless, the
fact that OASIS purifies water has provided the company with a cost advantage over its main competitors.

Since 1999, Oasis has pursued an aggressive sales strategy. By 2001, OASIS was firmly established as the market leader
in the 5 gallon segment, and the brand has retained that position.

After being only involved in dispenser water for many years, the company made an entrance into the bottled water
segment with a 6 litre pack.


B3. PACKAGED WATER

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88

(iii) Al Mazyona Mineral Water Co (AMW)

Brand: MAJAN
DARBAT (for Dhofar Beverages)
DIMA (for National Beverage Co.)
SULTAN, MADINA (for W. J. Towell; discontinued May 2005)

Lines: PET: 330 ml, 500 ml, 625 ml, 1.5 litre
cups: 100 ml (airlines only), 125 ml, 200 ml
5 gallon polycarbonate

The independent AMW was established in November 2000 after having been granted the second licence to bottle spring
water in Oman (the first one is held by NMW).

AMW started production of its MAJAN brand in 1.5 L and 500 ml PET bottles, and while other sizes have been added (e.g.
330 ml, cups) these two sizes still account for the bulk of sales.

MAJAN is also used for 5 gallon containers. However, production of this product was halted for several months in 2005
and was only recommenced (at significantly reduced volumes) late in the year. A second smaller brand, WADI AL ZORDI,
was discontinued in 2005.

DARBAT 500 ml and 1.5 L PET bottles are packed for Dhofar Beverages (which produces its own 200 ml cups see
below).

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89
DIMA 500 ml and 1.5 L PET bottles are packed for National Beverages.

SULTAN (500 ml and 1.5 L) and MADINA in (1.5 L) bottles were packed for WJ Towell, but AMW discontinued production
of these products in May 2005 due to capacity constraints.

(iv) Dhofar Beverage Company (DBC)

Brand: DARBAT, JARZEEZ

Line: Cups: 200 ml

DBC, the only soft drinks company situated in the Salalah area, is primarily a producer of juice drinks and, less
importantly, carbonated soft drinks under the AL KHALEEJ brand.

Through those ventures, DBC are in the possession of a water production licence as water treatment is one of the
production stages for beverages. DBC therefore decided to introduce their own water brand in cups, which was launched
under the DARBAT brand (the name of a local waterfall) in 200 ml cups in October 1999. In 2004 a further brand of cup
water (JARZEEZ) was introduced.

Since April 2003, DARBAT has also been bottled in 1.5 litre PET, and later 500 ml PET, under contract by AMW.

DBC used to be the official distributor for GULFA bottled water from the UAE until mid 2003. The company decided to
stop importing GULFA in order to focus on the development of their own brand, DARBAT, a move which significantly
boosted the latter while the former declined sharply. After negotiations about the future of GULFA in early 2005, DBC
have decided not to resume imports and will remain focused on their own water brands.

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90

(v) National Beverages Company (NBC)

Brand: DIMA

Lines: 500 ml and 1.5 L PET

NBC was the distributor for MASAFI (imported from the UAE) until March 2005. It launched DIMA in May 2005 which is
packed by AMW.

NBC bottles and distributes carbonates (ROYAL CROWN) and juice drinks (SUNTOP) and its primary focus is on these.
However, the distribution strength that results, alongside its previous experience in distributing MASAFI, led it to launch
its own brand DIMA.

(vi) Other Suppliers

There are at least 10 new suppliers of dispenser water in the market, although none has built a significant market share,
and indeed some entrants have subsequently disappeared again. They are very much concentrated in the Capital Area.
As previously noted, the major producers claim that the quality of their water is suspect but that representations on this
point to the authorities have been ignored because Government is more concerned with the job creation prospects of
these companies than a perceived but unproven health risk.

B3. PACKAGED WATER

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91

(i) Pepsi Beverages/ Oman Refreshment Company

Brand: AQUAFINA

Lines: 600 ml, 1.5 L PET

In January 2004 Pepsi launched its AQUAFINA bottled water via its local partner Oman Refreshment Company (ORC).

For three years prior to this, ORC had distributed JEEMA water imported from the UAE and the loss of this arrangement
has hit JEEMA volumes very substantially.

Given ORCs distribution strength it is no surprise that AQUAFINA initially did well, although competitors claim that
consumers do not like its taste, preferring natural mineral water. Then in April 2004 a malicious text message was
circulated in Oman claiming that AQUAFINA was produced from recycled water. ORC claim to know that the origin of this
was a competitor (unnamed).

Pepsi and ORC decided that there was little point in seeking legal redress for this libel (although they did get the Ministry
of Health to support them in refuting the claims) and focused instead on a commercial response. This took the form of
giving AQUAFINA away to the trade as a bonus on purchases of Pepsi carbonates on a 10 + 2 basis (buy 10 cases of
Pepsi carbonates get two cases of AQUAFINA free). Given Pepsis dominance in the carbonates market, this meant that
the trade was quickly loaded up with AQUAFINA which began to be sold on to consumers at much reduced prices. This
naturally squeezed competitors sales very hard and they were forced to also cut prices.

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In 2005, AQUAFINA was given strong promotional support, leading it to increase its market share of the bottled water
market from 13% to nearly 17%.

(ii) Masafi Mineral Water/ Matrah Cold Stores

Brand: MASAFI

Lines: Cups: 125 ml, 200 ml, 250 ml
PET: 330 ml, 500 ml, 1,5 Litre

Imported from the UAE, MASAFI is premium positioned natural mineral water, and volumes are in decline under price
pressure and increased competition from local brands. Until recently it had been the leading imported brand in Oman,
but has now been overtaken by Pepsis AQUAFINA.

Matrah Cold Stores took over the distribution of MASAFI from National Beverages Company in March 2005.


B3. PACKAGED WATER

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93

(iii) Coca-Cola/Al Ahlia Gulf Line

Brand: ARWA (formerly RIWA)

Sizes: 500 ml, 1.5 L PET

Coca-Cola was ahead of rival Pepsi in launching its water brand RIWA into the Omani market. The product was originally
packed under contract by National Mineral Water, but in mid-2004 Coca-Cola re-branded the product as ARWA and at the
same time moved production to the UAE. Despite some disruption caused by this, the brand retains a significant market
share.


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94
Table B24: Packaged Water, Total Supplier Shares, 2001-2005

Supplier Shares (%)
2001 2002 2003 2004 2005
National Mineral
Water
42.4 44.3 45.5 40.3 39.2
Al Mazyona 5.5 9.8 12.5 16.3 15.0
Pepsi/ORC 0.0 0.0 0.0 9.6 12.6
Oasis 15.5 14.2 12.8 12.3 12.6
Masafi/MCS 14.9 13.2 12.8 10.7 8.3
Coke/Al Ahlia 3.8 5.6 7.3 6.5 7.0
Other imports 17.8 12.8 9.0 3.1 3.0
Other local 0.1 0.1 0.1 1.2 2.3
Total 100 100 100 100 100

Total (m litres) 121.8 132.9 143.4 154.5 170.8

Key Points:
National Mineral Water has been for many years the
dominant force in the market. It reached a peak market
share in 2003, but with such a large share it is
unsurprising that new entrants have taken from it in
2004. Its EL JEBAL EL AKHDAR is the leading brand in the
bottled market while SALSABEEL is number two in
dispensers.
Oasis is the clear leader in dispenser water and decided to
enter the bottled water market i n early 2006 with a 6L
pack.
Al Mazyona has lost some share to Pepsis AQUAFINA and
Cokes ARWA over the year. Previous growth in 2003 and
2004 was spurred by the growth of DARBAT, packed for
Dhofar Beverages.
Masafi until recently the leading imported water
changed distributor in early 2005. Its position as a
premium product is inevitably being eroded by cheaper
local competitors.
The introduction of own brands from the large retail
outlets has caused a slight increase in other imports.

B3. PACKAGED WATER



95
Table B25: Bottled Water, Brand Shares, 2001-2005

Supplier Shares (%)
2001 2002 2003 2004 2005
NMW brands
43.4 46.3 48.2 43.3 39.4
AQUAFINA 0.0 0.0 0.0 13.3 16.8
DARBAT 0.1 0.1 3.7 10.7 10.4
MASAFI 20.0 17.8 17.3 14.8 11.1
ARWA 5.1 7.6 9.9 8.9 9.4
DIMA - - - - 4.5
MAJAN 7.2 10.6 8.3 4.1 4.3
Other imports 23.9 17.3 12.2 4.3 3.9
Other local 0.3 0.3 0.4 0.6 0.2
Total 100 100 100 100 100

Total (m litres) 90.6 98.5 106.1 111.8 127.8

Key Points:
Although exact splits between the NMW brands are
not available, it is clear that EL JEBEL EL AKHDAR was
the leading single brand in the Oman market with a
share exceeding 20% in 2005.
AQUAFINA moved up to second place, and is
competing strongly with EL JEBEL EL AKDHAR to be
the leading single brand.
Despite having a slightly lower share that last year,
DARBAT moved up to third place, capitalising on the
decline in sales of MASAFI. MASAFIs change in
distributor had a significant impact on sales, and is in
decline due to its premium price.
ARWA has recorded a slight gain in share for 2005,
helped by its promotional activity.
MAJAN has declined from its peak, although Al
Mazyona has benefited from the success of DARBAT
which it fills under contract.
Launched in May 2005, DIMA has captured a
significant share of the market, benefiting from NBCs
previous experience in distributing MASAFI.
Other imports saw a slight rise as many of the large
retail outlets (e.g. Carrefour, Lulu) started offering
their own brands at very low prices.

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96

Table B26: Dispenser Water, Brand Shares, 2001-2005

Brand Shares (%)
2001 2002 2003 2004 2005
OASIS
60.6 55.7 50.3 44.3 50.0
SALSABEEL 39.4 38.5 37.6 33.5 38.6
MAJAN 0.0 5.8 11.8 17.7 2.2
Other local 0.0 0.0 0.2 4.4 9.3
Total 100 100 100 100 100

Total (m litres) 31.2 34.4 37.3 42.7 43.0

Key Points

OASIS replaced SALSABEEL as the leading dispenser
brand in 2000 and has retained that position ever
since.

MAJAN saw a significant decline in its shares due to a
temporary stop in production for the first five months
of the year.

Other local brands have seen a significant increase
their market share. Some of these brands do not
have their own production facility and are simply
collecting empty carboys from the larger brands and
refilling them with tap water and selling them at a
cheap price.

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97

Table B27: Bottled Water, Reference Brands Selected SKU Pricing, 2001-2005 (OR)

2001 2002 2003 2004 2005
EL JEBEL AL 1.5 L bottle 0.100 0.100 0.100 0.100 0.100
AKHDAR 500 ml bottle 0.060 0.060 0.060 0.060 0.060
MASAFI 1.5 L bottle 0.150 0.125 0.125 0.125 0.125
500 ml 0.080 0.080 0.080 0.080 0.080
AQUAFINA 1.5 L bottle - - - - 0.100
24 x 600 ml case - - - - 1.275
various 250 ml cups 0.050 0.050 0.050 0.050 0.050
SALSABEEL 6 L bottle - - - - 0.280
OASIS 5 gallon 0.850-0.900 0.900 0.900 0.900 0.900


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98

Key Points:

The above prices are based on two major retailers (Carrefour and Lulu hypermarkets) in the Capital Area.

The retail prices of water, particularly 1.5 litre bottles, have been under significant pressure as Pepsis tactic of offering
free bottles of AQUAFINA as a bonus on sales of carbonates caused the trade to become stocked up with the product.
The retail case price fell accordingly, reportedly as low as OR 0.450 for a 12 x 1.5 litre case in some outlets at Salalah.

Prices of smaller sizes were less affected, although as price differentials narrowed sales of these smaller sizes came
under pressure.

Bottled water is very widely distributed throughout the country, even into the Interior, and can be found even in the
smallest bagalas. It is naturally the cheaper brands that tend to be favoured outside the Capital Area, while premium
brands tend to be more limited to it.

Dispenser water is either distributed by the suppliers trucks directly to users, or via local shops which provide home
delivery as a customer service. At present, dispenser water is very much focused in the main urban areas (Capital Area
and to a lesser extent Salalah) and has yet to penetrate the interior.


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99
Table B28: Packaged Water, Five-Year Forecasts, 2005-2010

2005 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010
Bottled still 127.7 134. 3 140.8 146.7 151.8 156.7 5.2 4.8 4.2 3.5 3.2
Bottled sparkling 0.1 0.1 0.1 0.1 0.1 0.2 10.0 10.0 10.0 10.0 10.0
Dispenser 43.0 45.6 48.8 52.3 55.7 59.1 6.2 7.0 7.2 6.4 6.2
Total 170.8 180.1 189.7 199.1 207.5 216.0 5.4 5.4 5.0 4.3 4.0

Key Points:

Sales of water will continue to grow ahead of the population, although rates of growth will slow as the market matures.
There are two main drivers behind this:

o intense competition between heavily supported imported brands (e.g. AQUAFINA) and local suppliers will hold down
prices

o the wider availability of larger pack sizes, and particularly 5 gallon containers, will cause average prices per litre to
fall and thus makes the product more attractive to marginal consumers.

Growth will be strongest in larger pack sizes, and particularly 5 gallon containers.

As tourist numbers grow then so will consumption of sparkling water, but volumes are and will remain very small in total.

B4. LIQUID DILUTE DRINKS



100
Table B29 to B30 below summarise the development of the Oman liquid dilute drinks market during the period 2001-2005.

Table B29: Liquid Dilute Drinks, Million Litres, 2001-2005

2001 2002 2003 2004 2005 2001 2002 2003 2004 2005
Consumption 1.0 1.0 1.1 1.3
1
1.5 - - 10.0 18.2 15.4
Consumption SSE 6.4 6.7 7.0 8.0 9.3 (4.5) 4.6 4.5 14.3 16.3
Litres per capita 2.77 2.89 3.00 3.38 3.88 (6.1) 4.3 3.8 12.7 14.8

Table B30: Liquid Dilute Drinks, Retail Value, 2001-2005

2001 2002 2003 2004 2005 2001 2002 2003 2004 2005
Market value 1.9 2.0 2.1 2.4 2.7 (5.0) 5.3 5.0 14.3 12.5
Sales per capita 0.82 0.86 0.90 1.01 1.13 (6.8) 4.9 4.7 12.2 11.9

1
2004 consumption figures have been revised in light of new information from one of the key suppliers.




101
0.00
0.20
0.40
0.60
0.80
1.00
1.20
1.40
1.60
2001 2002 2003 2004 2005
M
i
l
l
i
o
n

L
i
t
r
e
s





102
Key Points:

Liquid dilutes consumption in Oman has shown high levels of growth in the last two years, although from a very low base
remains small. The sector has grown by an average annual rate of 9.8% since 2001 to reach 9.3 million litres in 2005
in SSE terms. This assumes a dilution factor of 1:9 for squashes and syrups and 1:5 for cordials.

In value terms, this is worth around US$ 2.7 million at retail level.

Market volume has grown faster than market value because of the downward pressure on prices in this category.

The category essentially survives because liquid dilutes are a traditional product around Ramadan, when around two-
thirds of annual sales occur. The only significant driver for growth is marketing activity by Aujan, supplier of the leading
cordial brand VIMTO and this is insufficient to stir an essentially torpid market.




103
B4.2.1 CORDIALS v SQUASHES v SYRUPS

Table B31: Liquid Dilute Drinks, by Type, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Cordials retail
form
0.9 0.9 1.0 1.2 1.4 11.5

- - 11.1 17.6 18.4
Cordials SSE 5.4 5.6 6.0 7.0 8.4 11.5 (5.3) 3.7 7.1 16.7 19.3
Squashes retail
form
0.1 0.1 0.1 0.1 0.1 (0.3)

- - - - (1.0)
Squashes SSE 1.0 1.0 1.0 1.0 1.0 (0.3) - - - -- (1.0)
Syrups retail
form
<0.1 <0.1 <0.1 <0.1 <0.1 -

- - - - -
Syrups - SSE <0.1 <0.1 <0.1 <0.1 <0.1 - - - - - -
Total retail
form
1.0 1.0 1.1 1.3 1.5 10.7

- - 10.0 18.2 15.4
Total SSE 6.4 6.7 7.0 8.0 9.3 9.8 (4.5) 4.7 4.5 1.4 16.3





104

Share of Total (%)
2001 2002 2003 2004 2005
Cordials retail form 90 90 91 92 93
Cordials SSE 84 84 86 88 89
Squashes retail form 10 10 9 8 7
Squashes SSE 16 16 14 13 11
Syrups retail form neg neg neg neg neg
Syrups - SSE neg neg neg neg neg
Total 100 100 100 100 100

Key Points:

Cordials dominate the sector. This is largely due to the long-standing importance of VIMTO, an old English brand with a
70 year presence in the region. Manufactured and distributed by Aujan, and enjoying considerable marketing support,
VIMTO is the only brand with a significant year round presence in the market and consumption outside the Ramadan
period.





105

Unlike in other countries of the region, squashes have never become as strongly established in Oman as cordials.
Volumes remain comparatively small and consumption is very much limited to Ramadan. The leading squash brand
elsewhere in the region (Co-Ros SUNQUICK) is handled in Oman by National Beverages, which is a very important player
in several other sectors and has never really placed any emphasis on developing squash sales.

Syrups are very marginal in importance, although both South Asian and French/Lebanese brands are seen in the market.





106
B4.2.2 PACKAGING

Table B32: Liquid Dilute Drinks, by Pack Type, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
NRB 0.97 0.97 1.05 1.20 1.40 9.6 -1.0 - 8.2 14.3 16.7
Other 0.03 0.03 0.05 0.10 0.10 35.1 50.0 - 66.7 100.0 0.0
Total 1.0 1.0 1.1 1.3 1.5 10.7 - - 10.0 18.2 15.4

Share of Total (%)
2001 2002 2003 2004 2005
NRB 97 97 95 92 93
Other 3 3 5 8 7
Total 100 100 100 100 100





107

Key Points:

This sector is dominated by non-returnable glass bottles. These are mostly of 710 ml size (e.g. VIMTO), although some
syrups come in a slightly smaller size (600 640 ml) and SUNQUICK squash is in 840 ml.

The only other packaging found is PET bottles. BRAVO, the leading squash brand from Malaysia uses a 750 ml PET bottle,
while ROBINSONS from the UK offers a 1 litre PET option. RIBENA also comes in two PET sizes (600 ml and 1 litre)
alongside its traditional non-returnable glass bottle.



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108

Table B33: Liquid Dilute Drinks, Local vs Imports, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Local 0.0 0.0 0.0 0.0 0.0 0.0 - - - - -
Import 1.0 1.0 1.1 1.3 1.5 10.7 - - 10.0 18.2 15.4
Total 1.0 1.0 1.1 1.3 1.5 10.7 - - 10.0 18.2 15.4

Key Points:

There is no local production of dilute drinks in Oman.

The main source of imported products is Saudi Arabia for VIMTO and several lesser brands of cordial such as TONO. The
UK supplies RIBENA.

Squashes come from a variety of sources including Malaysia (BRAVO), Denmark (SUNQUICK) and the UK (ROBINSONS).

Syrups come mainly from South Asia (ROO HAFZA ex Pakistan, RASNA ex India) or Lebanon.





109
Table B34: Liquid Dilute Drinks, Total Supplier Shares, 2001-2005

Supplier Shares (%)
2001 2002 2003 2004 2005
Aujan VIMTO 45 48 49 59 64
Other cordials 45 42 42 34 29
BRAVO 3 3 3 3 3
Other squashes 7 7 6 5 4
Syrups Neg Neg Neg Neg Neg
Total 100 100 100 100 100

Total (m litres) 1.0 1.0 1.1 1.3 1.5

Key Points:

While it has long been the leading brand in the
market, Aujans VIMTO has grown strongly over the
last four years as Aujan has committed more
resources (notably advertising spend) to its
development. It is the only brand that enjoys
significant year-round sales.
Most other cordial brands are essentially cheaper
imitations of VIMTO, adopting a similar fruit flavour
and packaging. The most prominent of these is TONO,
sourced from Arrow Foods in Saudi Arabia and
distributed by Khimji Ramdas. Glaxo SmithKlines
RIBENA is also well distributed.
The much smaller squashes segment is led by
BRAVO, manufactured in Malaysia for Bytco
International in the UAE. Co-Ros SUNQUICK, which is
a market leader elsewhere in the region, is small in
Oman.




110
Table B35: Liquid Dilute Drinks, Reference Brands Selected SKU Pricing, 2001-2005 (OR)

2001 2002 2003 2004 2005
VIMTO 710 ml NRB 0.825 0.825 0.750 0.720 0.720
TONO 710 ml NRB 0.600 0.600 0.600 0.600 0.600
BRAVO 710 ml NRB 0.800 0.450 0.450 0.420 0.380
(750ml
PET)
ROO HAFZA 740 ml NRB 0.600 0.640 0.650 0.650 0.600
ROBINSONS 1 L PET - - - - 0.600

Key Points:

Retail prices remained broadly stable in 2005. Previous years had seen some downward pressure on prices due to
competition from cheaper alternatives but VIMTO seeks to stay above the fray and maintain its price differential while
weaker brands are forced to compete on price.

VIMTO enjoys broad year-round distribution throughout most of the trade. But for most of the year, distribution of other
dilutes is largely limited to larger outlets which have sufficient space to dedicate to them. These outlets tend to focus on
more strongly branded products such as RIBENA and ROBINSONS. However, in the period around Ramadan smaller
outlets take to stocking dilutes and it is during this period that the VIMTO imitations achieve their greatest penetration.
Once Ramadan is over, they tend to disappear from the market for the next ten months.




111

Table B36: Liquid Dilute Drinks, Five-Year Forecasts, 2005-2010

2005 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010
Consumption 1.5 1.7 1.8 1.9 2.0 2.1 13.3 5.9 5.6 5.3 5.0
Consumption SSE 9.3 10.6 11.3 11.9 12.5 13.1 13.5 6.6 5.3 5.0 4.8

Key Points:

Dilute drinks are traditionally consumed at Ramadan and it is thought that the growth of this category will be largely
dictated by the performance of Aujans VIMTO. The high growth rate is expected to continue in 2006, gradually slowing
down as the c ompetitive pressure from alternative beverages (particularly ready to drink juices) increases.


B5. POWDERED FRUIT DRINKS



112

Table B37 to B38 below summarise the development of the Oman powdered fruit drinks market during the period 2001-2005.

Table B37: Powdered Fruit Drinks, Tonnes and Million Litres SSE, 2001-2005

Growth (%)
2001 2002 2003 2004 2005 2001 2002 2003 2004 2005
Tonnes 2,350 2,310 2,330 2,385 2,445 3.5 (2.0) 0.8 2.3 2.5
Million Litres SSE 18.8 18.5 18.6 19.1 19.6 3.5 (2.0) 0.8 2.3 2.5
Litres per capita 8.1 8.0 8.0 8.1 8.1 - - - - -

Table B38: Powdered Fruit Drinks, Retail Value, 2001-2005

2001 2002 2003 2004 2005 2001 2002 2003 2004 2005
Market value 10.0 9.8 9.3 9.5 9.7 3.1 (2.0) (5.1) 2.2 2.5
Sales per capita $ 4.33 4.22 3.99 4.00 4.06 1.4 (2.5) (5.4) 0.3 1.4





113
380
400
420
440
460
480
500
520
2001 2002 2003 2004 2005
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Key Points:

Consumption of powdered fruit drinks in Oman has grown by an average annual rate of 1.0% since 2001 to reach 19.6
million litres in 2005. This equates to 2,445 tonnes of product assuming that one kilo of powder makes eight litres of
liquid. In value terms, this is worth around US$ 9.7 million at retail level.

Per capita consumption is almost unchanged at eight litres throughout the period.

Market value has declined over the period, as i s most clearly seen from the per capita sales value. This decline was
particularly marked in 2003 and reflected two key factors:

o An influx of new low priced brands to the market, often imported on a casual basis, which forced an all round
reduction in prices.
o A large volume of parallel imports of market leader TANG which placed further pressure on that brands premium
prices.

The apparent stability of the market in volume terms seen in the figures in fact hides a significant conflict between
opposing forces:

o There is a general market trend, seen throughout the region, towards fresh short-life juice products and away from
long-life products and less convenient products such as powdered fruit drinks
o Kraft, owner of TANG, supports its brand vigorously in order to prevent or delay any significant decline. As TANG holds
such a large market share, this activity benefits the entire category.





115
B5.2.1 PACK TYPE

Table B39: Powdered Fruit Drinks, By Pack Type and Size, 2001-2005

Tonnes Growth (%)
2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Jar < 750g 940 785 720 715 720 (6.4) (7.8) (16.5) (8.3) (0.7) 0.7
Pouch < 750 g 50 70 115 120 120 24.5 - 40.0 64.3 4.4 0.0
Can 1.5 kg 190 185 190 190 195 0.7 (17.4) (2.6) (2.7) 0.0 2.6
Can 2.5 kg 1,170 1,270 1,305 1,360 1,410 4.8 14.7 8.5 2.8 4.2 3.7
Other Neg Neg Neg Neg Neg N/A - - - - -
Total 2,350 2,310 2,330 2,385 2,445 1.0 3.5 (2.0) 0.8 2.3 2.5





116

Share of Total (%)
2001 2002 2003 2004 2005
Jar < 750g 40 34 31 30 29
Pouch < 750 g 2 3 5 5 5
Can 1.5 kg 8 8 8 8 8
Can 2.5 kg 50 55 56 57 58
Other Neg Neg Neg Neg Neg
Total 100 100 100 100 100

Key Points:

Consumer preference has steadily shifted away from the smaller sizes (750g jar and below) in favour of the 2.5 kg can,
which of course offers the lowest price per litre of diluted product. The dominance of the 2.5 kg can is largely due to the
high sales it enjoys during the Ramadan period. In the other months of the year, it is the 750g jar which is the most
dominant.

Foil pouches were launched into Oman by Kraft in 2001. Given their slightly lower price it might be expected that they
would attract considerable usage, but in fact they remain comparatively marginal.


B5.3 SOURCING


117

Table B40: Powdered Fruit Drinks, Local v Imports, 2001-2005

Tonnes Growth (%)
2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Local 5 5 5 5 5 0.0 0.0 0.0 0.0 0.0 0.0
Import 2,345 2,305 2,325 2,380 2,440 1.0 3.5 (2.0) 0.8 2.3 2.5
Total 2,350 2,310 2,330 2,385 2,445 1.0 3.5 (2.0) 0.8 2.3 2.5

Key Points:

As is evident, the market is totally dependent on imports. The primary source of these is the USA where TANG originates.

Other sources of significant volumes include Malta (FOSTER CLARKS), Turkey (MAK-C and TRI-C) and India (RASNA).

There is one locally made brand, ZAMZAM, produced by Alliance Foods and distributed by Muscat Pharmacy. However,
sales volumes are tiny and its impact on the market is negligible.





118
Table B41: Powdered Fruit Drinks, Total Supplier Shares, 2001-2005

Supplier Shares (%)
2001 2002 2003 2004 2005
Kraft TANG 78 75 71 68 68
FOSTER CLARKS 11 11 12 12 12
Other 11 14 17 20 20
Total 100 100 100 100 100

Total (tonnes) 2,350 2,310 2,330 2,385 2,445

Key Points:
Krafts TANG dominates the market. However, as a premium
priced product it has come under pressure from cheaper rivals
and its share has steadily slipped since 2001. To add to its
problems, official distributor Fairtrade has faced competition
from parallel imports of TANG reaching Oman via Dubai, having
been originally bound elsewhere.
In 2004, however, Kraft made a key change in its distribution
by establishing its own sales team in Oman (although remaining
under the banner of Fairtrade for sponsorship). This team works
exclusively on Kraft products including TANG and places greater
emphasis on key accounts, and taking a more structured
approach to reaching all distribution channels, than previously.
More broadly, TANGs share remains so high that its marketing
efforts go some way to supporting the whole category.
FOSTER CLARKS, distributed by Khimji Ramdas, remains the
clear if distant number two at a steady market share.
There are at least 25 other brands now found in the market
sporadically, the most established of which are MAK-C from
Turkey and RASNA from India. These achieve good distribution
(e.g. being available in hypermarkets) and sell on price against
the leading brands. Their combined sales are estimated to have
grown by 5% during 2005, which is double the growth rate of
the overall market.





119

Table B42: Powdered Fruit Drinks, Reference Brands Selected SKU Pricing, 2001-2005

2001 2002 2003 2004 2005
TANG 750g jar 1.200 1.300 1.200 1.100 1.160-1.200
(by flavour)
2.5 kg can 3.600 3.700 3.600 3.400 3.500
FOSTER CLARKS 750g jar 1.000 1.100-1.175 1.000 1.000 1.000
2.5 kg can 3.195 3.195 3.100 3.100 3.100
MAK-C 2.5 kg can 2.200 2.200 2.300 2.300 2.200





120

Key Points:

In recent years there had been continued downward pressure on prices, although in 2004 this was caused as much by
the discounting practices of the hypermarkets as by any competitive pressure. For example, in December 2004 a 750g
jar of TANG orange flavour was retailing at OR 0.990 in Carrefour, whereas the benchmark price for that product was OR
1.100. The retail price of TANG did increase in 2005 however.

One impact of price pressure has been that packs which started out as promotional items (e.g. 15% extra free) have
become standard SKUs for some brands (e.g. FOSTER CLARKS).

As the Omani retail scene changes as previously described (growth of hypermarkets, decline of bagalas) the importance
of these outlets for sales of powdered fruit drinks is naturally also changing. However, in order to ensure that no sector is
neglected Kraft has structured its sales force to address six specific channels: supermarkets (includes hypermarkets),
convenience stores, large grocers, small grocers, wholesale and institutional.

Institutional sales, including the food service sector, account for at least 15% of sales of powdered drinks as the more
cost conscious outlets favour them over more expensive ready-to-drink juices. Historically, the cheaper brands have
faired well in this sector since price is crucial and the ultimate consumer is not aware of the brand, but Kraft has
specifically targeted it (e.g. hospitals, schools) with some success.





121

Table B43: Powdered Fruit Drinks, Five-Year Forecasts, 2005-2010

2005 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010
Tonnes 2,445 2,475 2,505 2,535 2,565 2,595 1.2 1.2 1.2 1.2 1.2
Million Litres (SSE) 19.6 19.8 20.0 20.3 20.5 20.8 1.2 1.2 1.2 1.2 1.2

Key Points:

The future of the powdered fruit drink market seems likely to follow much the same pattern as the recent past. On the
one hand, the growth in population and the marketing efforts of Kraft and its competitors will both work to grow the
market, but on the other hand there is the inexorable pressure of convenience and superior alternatives (i.e. real ready
to drink juice) working against them.

On balance, we feel that further slight growth will yet be achieved before the market eventually goes into inevitable
decline. Compound annual growth of 1.2% is forecast for the next five years.


B6 MALT BEVERAGES



122

Table B44 to B45 below summarise the development of the Oman malt beverages market during the period 2001-2005.

Table B44: Malt Beverages, Million Litres, 2001-2005

2001 2002 2003 2004 2005 2001 2002 2003 2004 2005
Consumption 1.7 1.8 1.9 1.7 1.9 6.2 5.9 5.6 (10.5) 11.8
Litres per capita 0.74 0.78 0.82 0.72 0.83 5.7 5.4 5.1 (12.2) 10.4

Table B45: Malt Beverages, Retail Value, 2001-2005

2001 2002 2003 2004 2005 2001 2002 2003 2004 2005
Market value 2.3 2.5 2.6 2.3 2.7 4.5 8.6 4.0 (11.5) 17.4
Sales per capita $ 1.00 1.08 1.12 0.97 1.05 3.1 8.0 3.7 (13.4) 16.5


B6 MALT BEVERAGES



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1.46
1.60
1.75
1.89
2.04
2001 2002 2003 2004 2005
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Key Points:

Malt beverage consumption in Oman has grown at an average annual rate of 2.8% since 2001 to reach 1.9 million litres
in 2005. In value terms, this is worth around US$ 2.7 million at retail level. There was a sharp drop in consumption in
2004, as supply was disrupted:

o The local brands FALAJ and COLT disappeared from the market as Reem Beverages ceased all beverage production
o As the Euro strengthened dramatically against the dollar, the price of imported brands rose steeply, either
squeezing distributors margins or feeding through to trade or retail price rises.

With leading brands unavailable, some consumers of malt beverages turned to alternative soft drinks rather than just
alternative brands. The market therefore declined by over 10% in 2004. However, the market recovered strongly in
2005, and reached the consumption levels recorded in 2003.

To place this into context, the malt beverage market is less than 1.5% of the size of the carbonates market. Since
alcoholic beer is available in Oman, consumption of non-alcoholic beer is naturally limited. The main consumers are those
looking for a less sweet alternative to carbonates, as evidenced by the significant sales of flavoured malt beverages (see
below). But the higher prices of malt beverages (at least 50% higher than carbonates) restrict even this market.


B6. MALT BEVERAGES



125
B6.2.1 FLAVOUR

Table B46: Malt Beverages, By Flavour, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Regular 1.19 1.22 1.24 1.16 1.27 1.6 3.5 2.5 1.6 (6.5) 9.5
Flavoured 0.51 0.58 0.66 0.54 0.63 5.4 13.3 13.7 13.8 (18.2) 16.7
Total 1.7 1.8 1.9 1.7 1.9 2.8 6.2 5.9 5.6 (10.5) 11.8

Share of Total (%)
2001 2002 2003 2004 2005
Regular 70 68 65 68 67
Flavoured 30 32 35 32 33
Total 100 100 100 100 100


B6. MALT BEVERAGES



126

Key Points:

While the original near beer flavour still accounts for over two-thirds of malt beverage sales, other flavours now hold
around one-third of the market.

There is a broad range of flavours available including lemon, apple, strawberry, peach, raspberry and cherry.

The two leading brands, BARBICAN and MOUSSY, are particularly strong in the flavoured segment and have been central
to its development. Most other brands offer a much smaller range of flavours (e.g. lemon only).


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127
B6.2.2 PACKAGING

Table B47: Malt Beverages, by Pack Type, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Cans 0.68 0.67 0.67 0.60 0.48 (8.3) (39.3) (1.5) - (10.4) (19.8)
Non-ret. glass 1.02 1.13 1.23 1.10 1.42 8.6 112.5 10.8 8.8 (10.6) 29.1
Total 1.7 1.8 1.9 1.7 1.9 2.8 6.2 5.9 5.6 (10.5) 11.8

Share of Total (%)
2001 2002 2003 2004 2005
Cans 40 37 35 35 25
Non-ret glass 60 63 65 65 75
Total 100 100 100 100 100


B6. MALT BEVERAGES



128

Key Points:

Non-returnable glass bottles dominate the market. The main reasons for this are:

o Under Omani food regulations, malt beverages in NRB have a 12 month expiry while cans have just 9 months. Clearly
for relatively slow moving products the longer shelf life is preferred by the trade

o Brand leader BARBICAN is not available in cans

o Former brand leader MOUSSY is no longer available in cans.


B6. MALT BEVERAGES

B6.3 SOURCING


129

Table B48: Malt Beverages, Local vs Imports, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Local 0.24 0.26 0.29 0.06 0.00 (100) (70.0) 8.3 11.5 (79.3) (100)
Import 1.46 1.54 1.61 1.64 1.90 6.8 82.5 5.6 4.5 1.9 15.9
Total 1.7 1.8 1.9 1.7 1.90 2.8 6.2 5.9 5.6 (10.5) 11.8

Key Points:

Oman is the only GCC country in which a licence for local production of malt beverages has been granted, since
production usually requires brewing an alcoholic beer and then removing the alcohol. The licence was granted in 1985
but production only began in 1993. To protect this local industry, imports of malt beverages were banned between 1985
and the bans lifting in 1997.

The local producer, Reem Beverages, got into increasing difficulties in the late 1990s, mainly due to competitive
pressures on its other products (carbonates, juices). It scaled back its activities in all sectors and further opened the door
to malt beverage imports which took an 85% share in 2001. Reem Beverages halted all beverage production in 2003 and
despite claims that it will resume has not yet done so. No other local companies produce malt beverages in Oman and
therefore the market is completely made up of imports.

B6. MALT BEVERAGES

B6.3 SOURCING


130

Almost all imported brands come from Europe, with the Netherlands (BARBICAN, 3 HORSES) and Switzerland (MOUSSY)
being particularly significant sources.

Aujan are expected to start producing BARBICAN in their new factory in Dubai in mid 2006. It is thought that the product
will be exported to Oman from this factory.


B6. MALT BEVERAGES

B6.3 SOURCING


131

(i) Reem Beverages

Reem Beverages (formerly Gulf Beverage Industries) is part of the Omzest Group along with Oman Agricultural
Development Co, a major fresh dairy, the two companies sharing distribution.

From 1993 to 2003, Reem Beverages produced malt beverages under the FALAJ and COLT brands, as well as carbonates
and juice drinks. The products were packed in 330 ml cans, with FALAJ being primarily for the domestic market and COLT
for export (although COLT was launched domestically in 2001).

In the late 1990s, Reems other products came under increasing competitive pressure, so that in 2001 the entire
business was scaled back, and in 2003 production was ended. The company claims that it intends to recommence
production in the future although no date has been set. At the present, therefore there is no production of malt
beverages in Oman.


B6. MALT BEVERAGES

B6.3 SOURCING


132
B6.3.2 IMPORTED BRANDS MAIN SUPPLIER PROFILES

There are two main importers of malt beverages:

(i) Aujan Industries

Brand: BARBICAN

Lines: 330 ml NRB in regular, lemon, apple, raspberry, peach flavours

Aujan purchased BARBICAN in 1999 from its former owners UK brewers Bass who continue to contract pack it in the
Netherlands. Through steady marketing it has grown to become the leading brand in the market, displacing MOUSSY for
the first time in 2004.

(ii) WJ Towell

Brand: MOUSSY

Range: 330 ml NRB in classic (regular), apple, peach, strawberry, raspberry, cherry flavours
330 ml can in classic only (discontinued in the course of 2005)

MOUSSY (part of the Carlsberg Group) is imported to Oman by WJ Towell, which handles leading companies such as
Mars. The company did well to grow the brand to market leadership between 2000 and 2003, but pricing problems due to
the appreciation of the Euro against the dollar caused volumes to fall back and leadership be lost in 2004.
I MES Consulting Group - Middl e East Non- Alcoholic Beverages 2006 - Oman

B6. MALT BEVERAGES



133
Table B49: Malt Beverages, Total Supplier Shares, 2001-2005

Supplier Shares (%)
2001 2002 2003 2004 2005
BARBICAN 12 14 16 23 31
MOUSSY 18 18 18 13 13
3 HORSES 6 6 6 9 9
FALAJ/COLT 14 14 15 4 0
Other 50 48 45 51 47
Total 100 100 100 100 100

Total (m litres) 1.7 1.8 1.9 1.7 1.8

Key Points:

Having been one of the first brands launched after the
import ban was lifted in 1997, BARBICAN attained
market leadership for the first time in 2004 having
steadily strengthened its position year on year since
2001. AUJAN have invested in promoting the
BARBICAN brand through mass media advertising and
are increasingly targeting females.

Both BARBICAN and MOUSSY gained share at the
expense of the FALAJ/COLT brands which ceased
production.

3 HORSES, imported by Al Fair Trading, has
maintained its position. It is priced slightly below the
two leading brands.

FALAJ and COLT, who used to be the market leaders,
did not resume trading in 2005, and are probably
unlikely to do so in future.

B6. MALT BEVERAGES DRINKS



134
Table B50: Malt Beverages, Reference Brands Selected SKU Pricing, 2001-2005 (OR)

2001 2002 2003 2004 2005
BARBICAN 330 ml NRB 0.190 0.175-0.185 0.180 0.180 0.180
MOUSSY 330 ml NRB 0.175 0.175 0.175 0.180 0.220
330 ml can 0.175 0.180 0.180 0.150 -
3 HORSES 330 ml NRB 0.130 1.130-0.150 0.140 0.140 0.170
330 ml can 0.130 0.130-0.150 0.130 0.130 0.140

Key Points:

The rise of the Euro against the dollar has forced all the brands most of which are imported from Europe to raise their
prices.

It is notable that malt beverages retail at around OR 0.150 to 0.220 for a 330 ml unit, which compares to OR 0.100 for a
similar sized carbonate. This price differential is a clear constraint on malt beverage sales.

Considering the limited level of sales, it is surprising to find malt beverages distributed well down the trade (e.g. in
wholesalers) and into the Interior. However, the bulk of sales continue to be through the modern trade in the Capital
Area.
I MES Consulting Group - Middle East Non- Alcoholic Beverages 2006 - Oman

B6. MALT BEVERAGES



135
Table B51: Malt Beverages, Five-Year Forecasts, 2005-2010

2005 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010
Total 1.9 2.0 2.1 2.2 2.3 2.4 5.3 5.0 4.8 4.5 4.3

Key Points:

The 2004 decline in the market was driven by supply factors rather than demand. The market recovered strongly in 2005
and consumption levels reached 2003 levels. Future consumption is forecast to continue above population growth as new
consumers experiment with the product (the fact remains that the vast majority of consumers do not currently drink malt
beverages at all). However, in overall terms the market will remain small.


B7. ENERGY DRINKS



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Table B52 to B53 below summarise the development of the Oman energy drinks market during the period 2001-2005.

Table B52: Energy Drinks, Million Litres, 2001-2005

2001 2002 2003 2004 2005 2001 2002 2003 2004 2005
Consumption 0.100 0.140 0.245 0.375 0.520 333.0 40.0 75.0 53.0 38.7

Table B53: Energy Drinks, Retail Value, 2001-2005

2001 2002 2003 2004 2005 2001 2002 2003 2004 2005
Market value 0.47 0.66 1.15 1.76 2.44 671.0 40.0 75.0 53.0 38.7
Sales per capita $ 0.20 0.28 0.49 0.74 1.02 666.0 39.7 74.2 50.5 36.9


B7. ENERGY DRINKS



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0.00
0.10
0.21
0.31
0.42
0.52
0.63
2001 2002 2003 2004 2005
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Key Points:

Energy drinks were introduced to Oman in 1999 but only really began to take off with the 2001 launch of RED BULL.
Consumption has grown by an average annual rate of 51% since 2001 to reach 520,000 litres in 2005. In value terms,
this is worth around US$ 2.44 million at retail level, reflecting the high price per unit achieved for these products.

Per capita consumption remains tiny at just 220 ml per year in 2005 (i.e. a little less than a 250 ml can per head) as
energy drinks remain very much niche products.

Market value, however, is extremely robust. RED BULL has established a price point of 500 baiza per can, which is five
times the price of a can of a carbonated soft drink. Its competitors are generally priced below this but price is not a key
sensitivity in this niche market and market value has been growing in line with volume.

Energy drinks are marketed as edgy, individualistic products with stimulant properties, which is an attractive positioning
to young adults especially in a country where there is no access to alcohol for locals. It is this appeal that is driving
growth at present, although in Oman there is a limited number of people who can afford the premium price. There is also
some consumption by tourists as a mixer with alcoholic drinks (e.g. Vodka and RED BULL) and this will expand as tourist
numbers grow.


B7. ENERGY DRINKS



139
B7.2.1 PACKAGING

Table B54: Energy Drinks, by Pack Type, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
250 ml slimline
cans
0.095 0.136 0.243 0.375 0.520 53.0

351.9 43.2 78.7 54.3 38.7
Other 0.005 0.004 0.002 Neg Neg (100.0) 66.7 (20.0) (50.0) (90.0) -
Total 0.100 0.140 0.245 0.375 0.520 51.0 333.0 40.0 75.0 53.0 38.7

Share of Total (%)
2001 2002 2003 2004 2005
250 ml slimline
cans
95 97 99 100 100
Other 5 3 1 Neg Neg
Total 100 100 100 100 100


B7. ENERGY DRINKS



140

Key Points:

The 250 ml slim line can has become almost synonymous with the energy drink category with all leading brands adopting
it.

The only significant brand to use another pack type has been SHARK, which in addition to a 250 ml can has also been
available in a 150 ml glass bottle. This pack type was of measurable significance when SHARK was the main brand in the
market in 2000, but as other brands have overtaken it the 150 ml bottle has declined dramatically in relative importance.


B7. ENERGY DRINKS

B7.3 SOURCING


141

Table B55: Energy Drinks, Local vs Imports, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Local 0.0 0.0 0.010 0.010 0.0 - 0.0 - 0.0 0.0 (100. 0)
Import 0.100 0.140 0.235 0.365 0.510 51.0 333.0 40.0 75.0 53.0 42.5
Total 0.100 0.140 0.245 0.375 0.520 51.0 333.0 40.0 75.0 53.0 38.7

Key Points:

There has not been any local production of energy drinks in Oman since early 2004. There had previously been small
volumes of PEPSI X manufactured by Oman Refreshment Company during 2003 and early 2004 but the product failed to
find a market and was withdrawn.

The main source of imports by far is Austria, the origin of RED BULL as well as competitors such as RED BAT, which
supplies in excess of 75% of the market. Other less important sources include Thailand, Saudi Arabia and the UK.


B7. ENERGY DRINKS



142
Table B56: Energy Drinks, Total Supplier Shares, 2001-2005

Supplier Shares (%)
2001 2002 2003 2004 2005
RED BULL 50 61 67 70 71
SHARK 43 31 23 12 12
Other 7 8 10 18 17
Total 100 100 100 100 100

Total (m litres) 0.100 0.140 0.245 0.375 0.520

Key Points:

Since its launch in 2001 RED BULL has quickly come
to dominate the sector. As global market leader it has
the strongest brand and enjoys heavy marketing
support. Distribution is handled by National Mineral
Water, the leading company in bottled water, which
has great distribution strength. The 2003 launch of a
sugar free variant provided an additional boost, as did
a 2004 campaign to place chiller cabinets in selected
outlets.
Osotspas SHARK was the first energy drink with
regular distribution in the market through Dhofar
Beverages. However it has been unable to respond to
the competition from RED BULL despite a lower
selling price and its distributor is now increasingly
focused on other products such as its water and juice
ranges.
A wide variety of other brands is now found in the
market sporadically, and their combined sales are
now comfortably greater than SHARK, but it is
unlikely that any individual brand reaches a market
share of 5%.

B7. ENERGY DRINKS



143
Table B57: Energy Drinks, Reference Brands Selected SKU Pricing, 2001-2005 (OR)

2001 2002 2003 2004 2005
RED BULL 250 ml can - 0.520 0.500 0.500 0.500
RED BAT + others 250 ml can - - - 0.400-0.450 0.400-0.450
SHARK 250 ml can 0.250 0.240 0.250 0.250 0.250

Key Points:

As the dominant brand, RED BULL has set and maintained a premium price of 500 baiza, although hypermarkets may
discount from this (e.g. OR 0.440). Other sporadically imported brands clearly have to sell at below this price, and tend
to be retailed at around 400 baiza or a little higher. SHARK has always been priced quite distinctly from other energy
drinks.

As premium products, most distribution is in the wealthier Capital Area. Distribution of energy drinks is focused at the
top of the retail trade, with hypermarkets and supermarkets being the key outlets. Convenience stores, especially those
attached to roadside petrol stations such as SHELL SELECT, have also become an important channel as drivers may buy
a stimulant drink. In addition, sales through hotel bars are significant.


B7. ENERGY DRINKS



144

Table B58: Energy Drinks, Forecasts, 2005-2010

2005 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010
Total 0.520 0.702 0.878 1.010 1.111 1.167 35 25 15 10 5

Key Points:

This is a young and still immature market sector which has been exhibiting very high growth rates since its inception. It
is subject to high levels of marketing support, and new consumers continue to adopt the product. However, this state of
affairs cannot continue indefinitely, and growth will inevitably slow as the sector gradually matures. We are therefore
forecasting average annual volume growth of 25% over the next five years, but this will be heavily skewed towards the
early part of the period.


B8. SPORTS AND HEALTH DRINKS



145

Table B59 to B60 below summarise the development of the Oman sports and health drinks market during the period 2001-2005.

Table B59: Sports and Health Drinks, Million Litres, 2001-2005

2001 2002 2003 2004 2005 2001 2002 2003 2004 2005
Consumption 0.44 0.54 0.72 0.91 1.02 120.0 22.7 33.3 26.4 12.1

Table B60: Sports and Health Drinks, Retail Value, 2001-2005

2001 2002 2003 2004 2005 2001 2002 2003 2004 2005
Market value 1.11 1.65 2.03 2.41 2.70 226.5 48.6 23.0 18.7 11.6
Sales per capita $ 0.48 0.71 0.87 1.02 1.12 220.0 47.9 22.5 17.2 9.8





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0.00
0.20
0.40
0.60
0.80
1.00
1.20
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Key Points:

Sports and health drinks consumption in Oman has grown by an average annual rate of 23% since 2001 to reach 1.02
million litres in 2005. In value terms, this is worth around US$ 2.70 million at retail level. Per capita consumption has
grown from 0.19 litres in 2000 to 0.42 litres by 2005.

It is clear from these figures that demand for these products is still very small. Omani consumers are generally less well
off than those in neighbouring countries and the high price of sports and health drinks limits them to a niche market (see
section B8.5).

Nevertheless, Omani society is quite sports oriented, with football in particular widely played by boys and young men
after school and in the evenings. With 80% of sports drink sales taking the form of multi-packs sold through retail
channels, it is evident that this audience is being reached, albeit at very low levels of penetration due to the products
relatively high price.

Health drinks reaches an entirely different audience being widely fed to young children as a health booster. This market
is felt to be more mature.





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B8.2.1 SPORTS v HEALTH DRINKS

Table B61: Sports and Health Drinks, By Product Type, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Sports 0.34 0.34 0.50 0.67 0.75 21.9 70.0 0.0 47.1 33.0 11.9
Health 0.1 0.2 0.22 0.24 0.27 28.2 - 100.0 10.0 9.1 12.5
Total 0.44 0.54 0.72 0.91 1.02 23.4 120.0 22.7 33.3 26.4 12.1

Share of Total (%)
2001 2002 2003 2004 2005
Sports 77 63 69 73 74
Health 23 27 21 27 26
Total 100 100 100 100 100





149

Key Points:

In volume terms, sports drinks outsell health drinks by a factor of nearly 3:1. However, while sports drinks are primarily
sold in 330 ml cans, health drinks are sold in 120 ml glass bottles. It can thus be calculated that in unit terms, sales of
sports and health drinks are very similar.

If value is considered, the much higher price of health drinks on a per litre basis means that they actually marginally
outsell sports drinks overall.




150
B8.2.2 PACKAGING

Table B62: Sports and Health Drinks, by Pack Type, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Cans 0.3 0.3 0.45 0.6 0.66 21.8 50.0 0.0 50.0 33.3 10.0
PET bottles 0.04 0.04 0.05 0.07 0.08 18.9 - 0.0 25.0 40.0 14.3
Non-ret. Glass 0.1 0.2 0.22 0.24 0.27 28.2 - 100.0 10.0 9.1 12.5
Plastic pouch (powder) 0.01 0.01 0.01 0.01 0.01 - - 0.0 0.0 0.0 0.0
Total 0.44 0.54 0.72 0.91 1.02 23.4 120.0 22.7 33.3 26.4 12.1

Share of Total (%)
2001 2002 2003 2004 2005
Cans 68 55 62 66 65
PET bottles 9 7 7 8 8
Non-ret. Glass 22 37 31 26 26
Plastic pouch (powder) 1 1 <1 <1 1
Total 100 100 100 100 100




151

Key Points:

Sports and health drinks are packaged in distinctly different ways.

Ready to drink sports drinks are packed in either 330 ml cans or 500 ml PET bottles (there are also very small volumes of
powders which require mixing with water before consumption). Cans have been established in the market for longer and
are far more popular than PET bottles, despite the latters obvious advantage of being re-sealable. This appears to be
due to the differential in selling price, with the 330 ml can typically retailing at 200 baiza as compared to 300 baiza for
the larger PET bottle.

Health drinks have semi- medicinal image which is bolstered by their packaging a 120 ml brown glass bottle.



B8.3 SOURCING


152

Table B63: Sports and Health Drinks, Local vs Imports, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Local 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0
Import 0.44 0.54 0.72 0.91 1.02 23.4 120.0 22.7 33.3 26.4 12.1
Total 0.44 0.54 0.72 0.91 1.02 23.4 120.0 22.7 33.3 26.4 12.1

Key Points:

There is not now, nor has there ever been, any local production of sports or health drinks in Oman.

Interestingly, there are not even any regionally manufactured sports or health drinks. The main source of sports drinks is
Indonesia, where brand leader POCARI SWEAT is packed in cans, while the leading health drink ORONAMIN C is imported
from Japan.





153
Table B64: Sports and Health Drinks, Total Supplier Shares, 2001-2005

Supplier Shares (%)
2001 2002 2003 2004 2005
POCARI SWEAT 33 36 52 54 56
ISOSTAR 23 14 12 14 12
Other sports 21 13 6 5 5
ORONAMIN C 20 33 27 25 25
Other health 3 4 3 2 2
Total 100 100 100 100 100

Total (m litres) 0.44 0.54 0.72 0.91 1.02

Key Points:
Otsukas POCARI SWEAT is the clear leader in sports
drinks, with around 77% of that segment. It is
distributed by Muscat Pharmacy and is available in
three formats 330 ml can, 500 ml PET bottle and
powder. Sales to families in multi-packs are strong
(80% of volume is sold this way) and it is widely
available throughout the retail trade. In addition to its
intended use as a sports drink, it is also reportedly
prescribed by doctors to remedy fatigue and stomach
upsets.
The only real competition to SWEAT comes from
ISOSTAR, distributed by Matrah Cold Stores. The gap
between ISOSTAR and SWEAT continues to grow
however, as ISOSTAR is consumed mainly by
European expatriates, whose population in Oman is
steadily declining.
In earlier years of the review period, there was
greater competition from brands such as POWERADE
and GATORADE. However, this has faded.
Another Otsuka brand distributed by Muscat
Pharmacy, ORONAMIN C, dominates the health drink
segment, where it faces little serious competition.




154
Table B65: Sports and Health Drinks, Reference Brands Selected SKU Pricing, 2001-2005 (OR)

2001 2002 2003 2004 2005
POCARI SWEAT 330 ml can 0.200 0.200 0.200 0.200 0.200
500 ml PET - - - 0.300 0.300
ORONAMIN C 120 ml NRB 0.250 0.240 0.250 0.250 0.250

Key Points:

It can be calculated from the above that ORONAMIN C typically retails at the equivalent of OR 2.080 per litre and POCARI
SWEAT at OR 0.606 per litre. By comparison, the leading carbonate MOUNTAIN DEW retails at the equivalent of under
OR 0.300 per litre. Thus sports and health drinks are priced at a very substantial premium to mainstream alternatives.

As niche products, sports and health drinks are less prone to price competition than more mainstream sectors, prices
have remained stable over the last two years.

Outlets at the upper end of the market naturally stock both sports and health drinks. Given their small market, however,
it is a surprise to find both sports and health drinks in the wholesale sector and smaller stores. It seems that there are
hardcore consumers who favour these products at all levels of society.

A significant development in the last couple of years has been the expansion in the base of branded chiller cabinets in
both retail stores and sports/health clubs, primarily for POCARI SWEAT. Although volumes sold in this way are currently
small, the distributor hopes to encourage trial and uptake in this way.




155
Table B66: Sports and Health Drinks, Five-Year Forecasts, 2005-2010

2005 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010
Sports 0.75 0.83 0.92 1.01 1.07 1.13 10.7 10.8 9.8 5.9 5.6
Health 0.27 0.29 0.31 0.33 0.35 0.37 7.4 6.9 6.5 6.1 5.7
Total 1.02 1.12 1.23 1.34 1.42 1.50 9.8 9.8 8.9 6.0 5.6

Key Points:

Overall, the sports and health drink sector is forecast to experience average annual growth of 7.6% over the five year
forecast period. In this relatively immature market, growth will be greatest in the early years, with the growth rate
slowing steadily. However, this overall position disguises quite distinct patterns forecast for sports and health drinks.

The main growth is likely to come from sports drinks. There is a large base of potential users (young men playing sport)
who are not currently consuming the product, and recent marketing efforts from the main distributors (e.g. placing
chiller cabinets) should encourage take up. As the market expands, growth will naturally slow.

Health drinks are mainly consumed by children. Given their very high price they are always likely to remain a niche
product, and growth will therefore be driven by a combination of population growth and some new adopters entering the
market. Growth in the sector has already slowed dramatically from earlier rates and is driven mainly by ORONAMIN C,
which was being advertised in the Omani mass media in 2005.

B9. READY-TO-DRINK TEA



156

Table B67 to B68 below summarise the development of the Oman ready-to-drink (RTD) tea market during the period 2001-2005.

Table B67: RTD Tea, Million Litres, 2001-2005

2001 2002 2003 2004 2005 2001 2002 2003 2004 2005
Consumption 0.290 0.320 0.345 0.400 0.325 16.0 10.3 7.8 15.9 (18.8)
Litres per capita 0.13 0.14 0.15 0.17 0.14 14.1 10.2 7.2 14.0 (20.3)

Table B68: RTD Tea, Retail Value, 2001-2005

2001 2002 2003 2004 2005 2001 2002 2003 2004 2005
Market value 0.45 0.50 0.54 0.62 0.51 15.4 11.1 8.0 14.8 (17.7)
Sales per capita $ 0.19 0.22 0.23 0.26 0.21 14.6 10.6 7.5 12.9 18.8





157
0.00
0.05
0.10
0.15
0.20
0.25
0.30
0.35
0.40
0.45
2001 2002 2003 2004 2005
M
i
l
l
i
o
n

L
i
t
r
e
s





158

Key Points:

Consumption of RTD tea in Oman remains at very low levels, with an average annual growth rate of nearly 3% since
2001 to reach 0.325 million litres in 2005. In value terms, this is worth around US$ 0.51 million at retail level. Per
capita consumption has grown from 0.13 litres in 2001 to 0.14 litres by 2005.

The market declined by nearly 19% in 2005. The one brand that dominates the market LIPTON ICE TEA switched
distributor from Aujan to Oman Refreshment Company in January 2006. The probable reason for the decline in the
market size is that Aujan did not give sufficient importance to the product as they knew they would no longer be its
distributor in 2006.

Awareness and consumption of these products among Omani consumers is at very low levels. Indeed, a significant
proportion of existing consumption is among Western expatriates and visitors. It seems that from the Omani perspective,
RTD teas do not offer the familiarity of carbonates, the health benefits of juices or the functionality and imagery of
energy or sports drinks.





159
B9.2.1 FLAVOUR

Table B69: RTD Tea, By Flavour, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Peach 0.128 0.148 0.165 0.200 0.158 5.4 21.9 15.6 11.5 21.2 (21.0)
Lemon 0.140 0.150 0.160 0.180 0.151 1.9 13.8 7.1 6.7 12.5 (16.1)
Other 0.022 0.022 0.020 0.020 0.016 (7.7) - - (9.0) - (20.0)
Total 0.290 0.320 0.345 0.400 0.325 2.9 16.0 10.3 7.8 15.9 (18.8)

Share of Total (%)
2001 2002 2003 2004 2005
Peach 44 46 48 50 49
Lemon 48 47 46 45 46
Other 8 7 6 5 5
Total 100 100 100 100 100




160

Key Points:

As in most Gulf countries, the two flavours that were first introduced lead the market by a substantial margin. Unlike
elsewhere, however, peach is slightly more popular than lemon in Oman as it tastes slightly sweeter and is relatively
more popular with younger local consumers.




161
B9.2.2 PACKAGING

Table B70: RTD Tea, by Pack Type, 2001-2005

2001 2002 2003 2004 2005 CAGR 2001 2002 2003 2004 2005
Cans 0.212 0.192 0.165 0.184 0.303 9.3 (13.5) (9.5) (14.0) 11.5 64.7
NRB 0.073 0.122 0.152 0.176 0.006 (46.5) - 67.1 24.6 15.8 (96.6)
PET - - 0.02 0.040 0.006 - - - - 100.0 (85.0)
Other 0.006 0.006 0.007 0.008 0.010 13.6 20.0 - 16.7 14.3 25.0
Total 0.290 0.320 0.345 0.400 0.325 2.9 16.0 10.3 7.8 15.9 (18.8)

Share of Total (%)
2001 2002 2003 2004 2005
Cans 73 60 48 46 93
NRB 25 38 44 42 2
PET - - 6 10 2
Others 2 2 2 2 3
Total 100 100 100 100 100




162

Key Points:

Approximately 93% of the market is in single serve cans, dominated by LIPTON ICE TEA. Liptons 1.5 litre PET and 330
ml NRB have both been discontinued due to disappointing volumes.


B9.3 SOURCING


163

Key Points:

There is no local production of RTD tea products in Oman; the market is totally dependent on imports.

The two leading supplying countries are Saudi Arabia for LIPTON ICE TEA and Austria for RAUCH EISTEE.





164
Table B71: Ready To Drink Tea, Total Supplier Shares, 2001-2005

Supplier Shares (%)
2001 2002 2003 2004 2005
LIPTON ICE TEA 90 91 93 94 91
RAUCH EISTEE 8 7 5 4 6
Other 2 2 2 2 3
Total 100 100 100 100 100

Total (m litres) 0.290 0.320 0.345 0.400 0.325

Key Points:

This sector was largely created by the launch of
LIPTON ICE TEA and that brand continues to totally
dominate it. The brand was manufactured and
distributed by Aujan in 2005. Oman Refreshment
Company took over the distribution of the product in
January 2006.

The only other brand of any standing is RAUCH
EISTEE distributed by Khimji Ramdas, which is
available only in a 330 ml can. As the second brand in
the market, RAUCH is particularly affected by
marketing efforts on behalf of LIPTON. In real terms,
its growth was marginal, but it has nevertheless
increased its market share due to the poor
performance of LIPTON.

Other RTD tea products are imported on a casual
basis and may appear in the market temporarily
before disappearing again.




165
Table B72: RTD Tea, Reference Brands Selected SKU Pricing, 2001-2005 (OR)

2001 2002 2003 2004 2005
LIPTON 330 ml can 0.140 0.130 0.130 0.125 0.190
250 ml NRB - - 0.150 0.150 -
1.5 litre PET - - 0.425 0.425 -
RAUCH 330 ml can 0.230 0.195 0.190 0.190 0.190

Key Points:

RTD tea sells at a higher price point of 190 baiza per 330 ml can than a similar size carbonate which sells at 100 baiza.
Thus a consumer must make a positive choice to drink an RTD tea rather than simply trying a straight substitute for a
carbonate.

Liptons 1.5 litre PET bottle and 250 ml NRB are no longer available in the market. LIPTON ICE TEA is now only available
in a 330 ml can.

Being very much niche products, RTD teas are little seen outside the top-end retail outlets in the Capital Area.





166

Table B73: RTD Tea, Five-Year Forecast, 2005-2010

2005 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010
Total 0.325 0.365 0.405 0.442 0.478 0.514 12.3 11.0 9.1 8.9 7.5

Key Points:

In such a small and immature market suppliers activities can have a major impact on market size. In 2005, the
distribution of leading brand LIPTON was transferred to Oman Refreshment Company and this change is thought to have
been the reason behind the decline in the ready to drink tea market. It is anticipated that high levels of activity will
resume in 2006, but the market is not expected to reach 2004 levels until 2007. Unless very much greater growth can be
generated (which we doubt) then the market will remain too small to sustain high levels of investment. We therefore
expect growth to slow as marketing is scaled back later in the forecast period.


B10. DAIRY/JUICE BLENDS


167

Key Points:

Juice/milk blends contain real fruit juice (in some cases up to 80-90% of the contents may be fruit juice), with a small
amount of milk added. In this respect, they are distinct from fruit-flavoured milks, which are primarily milk and normally
contain artificial fruit flavouring with no real fruit content.

Juice/milk blends are already well established in neighbouring Saudi Arabia, where they have been amongst the fastest
growing category in recent years. However, juice/milk blends are not yet a regular feature of the Omani market,
although given the open nature of the Omani market it seems likely that sporadic unofficial imports in very small
volumes may occur.

As these products are showing good growth in the markets where they are present, it seems likely to be only a matter of
time before their formal appearance in Oman.


B11. FLAVOURED WATER


168

Key Points:

Flavoured water is currently a negligible market in Oman, and such volumes as there are have been included within the
main water section.

Despite this, two distinct segments can be defined:

Sparkling flavoured water, in flavours such as apple, lemon and peach, characterised by imported brands such as
APOLLINARIS and CLEARLY CANADIAN. These are normally packed in glass bottles and sold through A class outlets
and the up- market food service sector

Still flavoured water, in traditional local flavours such as rose and palm tree pollen, characterised by local brands
such as Al Mazyonas MAJAN.

In view of international developments in flavoured water, however, we will continue to monitor this sector.


Appendix: Directory of Importers and Local Beverage Producers, 2006


169
Note: Imported brands are shown with country of origin

Company
Carbonated Soft
Drinks
Fruit Juices
and Drinks

Bottled Water

Dilute Drinks
Powdered
Fruit Drinks
Malt
Beverages

Other
Al Accad Trading
Co
PO Box 450
Al Wadi Al Kabir
Tel: 24771047
CAPRI SONNE
(UAE)

Al Ahlia Gulf Line
(Oman)
PO Box 3024
Ruwi
Tel: 24590588
COCA-COLA
COCA-COLA
LIGHT
SPRITE
FANTA
QUWAT JABAL
SCHWEPPES
(UAE)

ARWA (UAE)
Al Fair - Technical
& Consumer
Services Co Ltd
PO Box 418
Madinat Al-Sultan
Qaboos 115
Tel: 24503469
BLUEBIRD (UAE)

BRAVO
(Malaysia)
3 HORSES
(Netherlands)

Al Mazyona
Mineral Water Co
PO Box 800
Barka
Postal Code 320
Tel: 884414
MAJAN
(distributed by
Khimji Ramdas)
MAJAN 5 gallon
Various brands
contract packed




170

Company
Carbonated Soft
Drinks
Fruit Juices
and Drinks

Bottled Water

Dilute Drinks
Powdered
Fruit Drinks
Malt
Beverages

Other
Al Rawabi
PO Box 402
Ruwi 117
Tel: 24561844
AL RAWABI
SAMBA
(UAE)

Ali Shaihani Juice
Filling Industries
PO Box 1842
Ruwi
Tel: 24813010
FIZZI
SHAMI
LULU
SHAMI
GIPSI

Alliance Food
Industries LLC
PO Box 1711
Seeb
Tel: 24816680
ZAMZAM
(distributed by
W J Towell)

Bahwan Foods
(Khalijana) Co
PO Box 711
Ruwi
Tel: 24592492
KDD, FRESCO
(Kuwait)
JOOS/TIFFANY
(UAE)

Dhofar Beverages
Co
PO Box 18390
Salalah
Tel: 23225705
AL KHALEEJ AL KHALEEJ DARBAT
JARZEEZ
GULFA
(UAE)
SHARK
(Thailand)



171

Company
Carbonated Soft
Drinks
Fruit Juices
and Drinks

Bottled Water

Dilute Drinks
Powdered
Fruit Drinks
Malt
Beverages

Other
Dhofar Cattle
Feed Company
PO Box 19220
Salalah
Tel: 23225793
A'SAFWAH
Fairtrade
PO Box 2636
Ruwi 112
Tel: 24701767
STAR
(UAE)
TANG (USA)

Far East Agency
Co
PO Box 180
Sultanate of
Oman 115
Tel: 24597756
ALMARAI
(Saudi Arabia)

Khimji Ramdas
PO Box 19
Muscat 113
Tel: 24592123
RAUCH (Austria)
ARROW (KSA)
FRUTTO/WOW
(KSA)
EMIRATES
(UAE)
TONO (KSA) FOSTER
CLARKS
(Malta)
RAUCH
(Austria)
Matrah Cold
Stores
PO Box 1158
Ruwi 112
Tel: 24707698

MASAFI (UAE)

PERRIER
(France)

ISOSTAR
(Germany/
Netherlands)



172

Company
Carbonated Soft
Drinks
Fruit Juices
and Drinks
Bottled
Water
Dilute Drinks Powdered
Fruit Drinks
Malt
Beverages

Other
Modern Dairy
Factory
PO Box 123
Muttrah 114
Tel: 24810753
AL KAMAYIL
Muscat Pharmacy
PO Box 438
Muscat 113
Sultanate of
Oman
Tel: 24813263
POCARI SWEAT
(Indonesia)
ORONAMIN C
(Japan)
National
Beverages Co
PO Box 84
Muscat 113
Tel: 24482607
RC COLA
RC Q
ROYAL CROWN
SUNTOP
ROYAL MANGO
SUNQUICK
Denmark)

National Food
Products Co LLC
PO Box 669
Ruwi 112
Tel: 24501160
LACNOR
GUMBA
MILCO, ABEER
(all UAE)
OASIS (UAE)



173

Company
Carbonated Soft
Drinks
Fruit Juices and
Drinks

Bottled Water

Dilute Drinks
Powdered
Fruit Drinks
Malt
Beverages

Other
National Mineral
Water Co
PO Box 2740
Ruwi 112
Tel: 24590095
TANUF
ASSAHA
EL JABAL AL
AKHDAR,
SALSABEEL
SALSABEEL
5 gallon
RED BULL
(Austria)

Oasis Water Co
PO Box 87
Code 124
Rusal Industrial
Area
Tel: 24446778
OASIS 5 gallon
Oman Marketing
Centre
PO Box 670
Muscat 117
Tel: 24811963

UNIKAI
AL MOROUJ
AREEJ (all UAE)

Oman National
Dairy Products
Co
PO Box 610
Ruwi 112
Tel: 24591125
ZAIN
TAMAM
FUN NAN
ZINGO




174

Company
Carbonated Soft
Drinks
Fruit Juices and
Drinks
Bottled
Water

Dilute Drinks
Powdered
Fruit Drinks
Malt
Beverages

Other
Oman
Refreshment Co
PO Box 30
Seeb 111
Tel: 24589100
PEPSI
DIET PEPSI
7-UP
DIET 7-UP
MOUNTAIN DEW
MIRINDA
SHANI
EVERVESS
TOP FRUIT AQUAFINA
(UAE)

Oman United
Agencies
PO Box 3985
Ruwi
Tel: 24703034
RIBENA
(Saudi Arabia)

RIBENA (UK),
ROBINSONS
(Jordan, UK)

PURDEYS,
AM,
AQUALIBRA
(all UK)
Teejan & Aujan
Marketing Co LLC
PO Box 1829
Ruwi 112
Tel: 24594641
VIMTO
DIET VIMTO
(Saudi Arabia)
RANI
VIMTO
(all Saudi Arabia)
VIMTO
(Saudi Arabia)
BARBICAN
(Netherlands)
LIPTON ICE TEA
(Oman
Refreshment
took over
distribution in
January 2006)
W J Towell & Co
PO Box 678
Wadi Kabir
Tel:24815224
MOUSSY
(Switzerland)

Source: IMES research.

Oman Softdrinks 2006

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