Spirits in Nigeria

PRE-COVID-19 PERFORMANCE

Strong growth for spirits as consumer confidence improves in 2019

Spirits recorded the strongest total volume growth in 2019 since 2014 as the economy improved and consumer confidence continued to grow, although lower-income consumers remained cautious in their spending and continued to favour less expensive brands. Even so, wealthier consumers increasingly opted for more premium formats, such as premium other blended Scotch whisky, single malt Scotch whisky and premium vodka as their disposable incomes increased.

Legislation looms to stop sales of smaller packs of spirits

The growth in sales of mainstream and lower-priced spirits faces a threat from the possible introduction of a ban on sales of spirits in sachets and small plastic bottles. In 2019, the National Agency for Food and Drug Administration and Control (NAFDAC) announced plans to ban the use of sachets and PET bottles in the packaging of spirits and other alcoholic drinks.

Intercontinental Distillers extends its lead in 2019

Intercontinental Distillers extended its lead in spirits in 2019 largely due to two strong brands, Chelsea London Dry Gin and Action Bitters. These brands are popular and sit within whiskies and bitters, which registered strong total volume growth in 2019.

2020 AND BEYOND

COVID-19 impact

On-trade volume sales of spirits are expected to fall by 27% in 2020 in light of the impact of COVID-19. This compares to an expected 5% rise forecast for 2020 during research conducted in May 2019, ie before the spread of COVID-19.

Affected products within spirits

All types of spirits will register steep double-digit volume declines in the on-trade environment in 2020. Brandy will record steep losses as many of these products are imported and will face issues from the restrictions on travel and border closures, while its high unit prices in on-trade will make it unaffordable for many after the damage to disposable incomes in 2020.

Recovery and opportunities

Total volume sales of spirits will return to minor growth in 2020, followed by accelerating growth over the remainder of the forecast period.

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