Although the category recorded substantial growth in 2011, the volume growth has been minimal since 2012. Even though the category volume grew and value increased from 2014 to 2015, this relatively substantial value increase was primarily attributed to the increase in malt beer pricing rather than volume growth.
This trend is expected to continue in the short to medium term as production costs, raw material costs, fuel costs and the electricity price all increase collectively, hampering further potential growth.
The on-consumption channel (66.6%) continued to dominate the volume distribution, but some of the sectors are said to have lost part of their volume share to the off-consumption channels. The larger retailers have opened more liquor stores and are able to attract increased sales through extensive promotional activities. This trend should continue in the short term, as these new stores establish themselves in the market.
The three major metropolitan regions (Gauteng, KwaZulu-Natal and Western Cape) continued to dominate the industry volume, accounting for the majority of total volume sold in 2015 (63.5%). It is believed that the volume of smaller pack sizes distributed in these regions was notable compared to the non-metropolitan regions.
The 600ml-750ml glass bottles continued to dominate the packaging demand for the category, but experienced limited growth as the category remains under pressure. The 440ml can showed significant growth (albeit off a small base), as some brands added the 440ml can to their product offering, thus appealing to consumers pursuing value for money options.
The market is expected to remain under pressure as the economy struggles to recover and disposable income remains low in the short to medium term.
