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Taiwan Food and Drink Report 2008Published by: Business Monitor International Published: Apr. 23, 2008 - 74 Pages Table of Contents
AbstractInvestment activity in Taiwan’s food and drink sector throughout 2007 confirms that the market remains amixed bag for investors. High consumer spending levels, driven by sound economic fundamentals andillustrated in a per capita food consumption level of US$1,992 in 2007, are highly attractive to investors.Food consumption growth is also appealing; to 2012, BMI is forecasting food consumption growth in percapita terms of 16.4% in Taiwan. Nonetheless, as this report makes clear, sector dynamism is no longerquite what it was and consequently the country’s leading food and drink players and increasingly lookingelsewhere for opportunities.Two recent developments ably highlight this trend. In January 2008, local traditional snack food producerWant Want Holdings revealed that it was to pursue a US$700mn initial public offering in a bid to raisefunds for expansion on the Chinese mainland. The company is confident that its combination ofconvenient and premium snack foods and traditional concepts and flavours will prove popular withaspirational Chinese consumers, and it is seeking a Hong Kong listing to facilitate its move.In November 2007, a similar strategy was pursued by leading local food processor Uni-PresidentEnterprises. The company also plans to list in Hong Kong in an effort to raise around US$700mn to helpbuild market share in China’s instant noodle and soft beverage industries. Uni-President’s strategy isparticularly pressing, with the company eager to take advantage of the exposure that Beijing’s hosting ofthe 2008 Olympics will bring. Both companies are also keen to list in Hong Kong in order to overcomelegislation preventing Taiwanese firms from investing more than 40% of their capital on the mainland.The overwhelming prioritisation of China depicts Taiwan as a low opportunity market and yet this is verymuch not the case. Existing sales levels and future growth prospects, coupled with Taiwan’s perceivedlow risk investment environment, have seen the market reach third place in BMI’s Asia Pacific Food &Drink Business Environment Ratings - which assess a market’s investment potential in comparison to itsregional peers. This potential has much to do with the country’s thriving mass grocery retail industry. Here, internationalhypermarket majors, such as Carrefour and Dairy Farm, stand alongside innovative convenience retailmajors, such as the local subsidiaries of Japanese giants 7-Eleven and FamilyMart. As all retailers lookto boost their competitiveness by offering ever-more premium and added-value products and services,food and beverage manufacturers are given ready and widespread distribution for their brands.Taiwan’s high spending levels and dynamic retail sector should ensure that the market remains animportant consideration for regional food and drink investors, even if it can no longer compete with thelikes of China when it comes to long-term growth prospects. Get Full Details About This Report >> |
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