Soft Drinks in Uzbekistan

Soft drinks in 2021: The big picture

Uzbekistan’s soft drink industry mounted a strong recovery over the course of 2021 as off-trade sales continued to rise in most categories and on-trade sales rebounded strongly from the negative sales growth that was recorded at the peak of the COVID-19 pandemic during 2020. However, it should be noted that on-trade sales have not yet returned to pre-COVID-19 levels and this can be attributed to the reluctance that many consumers still harbour about socialising outside of the home due to lingering fears of contagion.

2021 key trends

The influence of the COVID-19 pandemic remained the main story in Uzbekistan’s soft drinks market in 2021, with the key trend across industry during the year the recovery of on-trade sales as the consumer foodservice industry reopened after several months of social distancing restrictions led to strong on-trade sales declines across all categories during 2020. In the off-trade meanwhile, sales continued to increase due to expanding demand and a recovery of consumption occasions as many public events, social gatherings, parties and celebrations were held after virtually all such happenings were postponed during 2020 due to the COVID-19 pandemic.

Competitive landscape

The competitive landscape in soft drinks remained virtually unchanged in 2021 as the majority of the leading brands in each of the relevant categories managed to maintain their positions and value shares. The success of the leading names in carbonates, bottled water, juice, RTD tea and energy drinks during 2021 can be attributed mainly to the superior consumer awareness of brand names, effective pricing strategies and the robust approach that the producers of these brands have taken to marketing activity.

Retailing developments

The distribution of soft drinks via modern grocery retailers continues to improve in Uzbekistan and this is entirely due to the expansion of the outlet networks of the country’s leading chains of supermarkets and convenience stores. This expansion means that the leading chained grocery retailers now have better coverage in the most densely populated parts of Uzbekistan, with new convenience stores and supermarkets being opened in neighbourhoods across Tashkent and other major towns and cities on a very regular basis.

Foodservice vs retail split

2021 saw a partial recovery in on-trade sales of soft drinks as Uzbekistan’s horeca industry reopened at full capacity. Throughout 2020, the imposition of social distancing regulations meant that restaurants, bars and cafés throughout the country were unable to operate at full capacity, with on-premises service banned for extended periods and restrictions in place that made it impossible for foodservice establishments to operate at full capacity for much of the year.

What next for soft drinks?

Soft drinks is slated for further positive sales growth over the forecast period, a reflection of the rather underdeveloped state of the market generally and relatively low levels of per capita consumption, which means that there is still significant room for further growth and development across all categories. With the economic situation forecast to gradually improve, higher disposable income levels are set to have a positive impact on demand across all categories of soft drinks, with affluent urban consumers in particular expected to become more sophisticated and willing to experiment with their soft drinks choices as their financial circumstances improve.