Category : Industry
Date : Jul-05-2010 17:04
In a bid to establish a single point of interaction for the industry with the government, rivals and industry giants Coca-Cola and PepsiCo have joined hands along with other beverages makers and bottlers to establish the "Indian Beverage Association (IBA)". The association will also help beverage makers and bottlers in compliance issue related to food safety guidelines and other industry regulations.Apart from the two beverage giants Pepsi and coke other majors who have joined in on the initiative include Juices maker Dabur, packaging company Tetra Pak, bottling companies Pearl Drinks and Bengal Beverages, energy drink maker Red Bull, and drip & sprinkler systems firm Jain Irrigation Systems. In addition to the above companies the list includes other 30-40 companies including bottlers, vendors and suppliers are expected to join the association in due course including the likes of Bisleri International, Parle Agro, Amul and Godrej. Speaking on the matter Mr. Arvind Varma, secretary general of the association said, “Non-alcoholic beverages are on a growth trajectory but so far there has not been a comprehensive organization representing the industry. We felt it"s time”. Adding further he said that IBA will act as the point of interaction with the food safety authority and health ministry for the non-alcoholic beverages industry. The IBA will help its members deal with issues like compliance with guidelines of food safety authority, double taxation, VAT, sugar imports and spurious drinks. The IBA will also serve as a unified industry front for dealing with state-level controversies like allegations of water depletion (as is the case with Coca-Cola and PepsiCo). Meanwhile a direct official of the association on condition of anonymity said, “IBA"s formation has been triggered by the two cola companies, Coca-Cola and PepsiCo, since they are the one"s facing maximum flak from regulators — whether it"s VAT in Delhi, charges of water depletion in Kerala or being perceived as only making sugary fizzy drinks by health activists”. The need for such a platform was especially highlighted after a recent decision by the Delhi government to hike the VAT on soft drinks from 12.5% to 20%, earlier this year. The companies have ever since been lobbying with Delhi CM Shiela Dixit to withdraw the hiked taxation under the contention that the same will "reverse their growth cycle". It is worth noting that beverage makers have been reeling under reduced margins ever since the hike as they have not increased prices under the fear that doing so may impact demand for their products. Meanwhile many beverage makers, bottlers and suppliers have expressed their intent on joining the IBA. Meanwhile it is worth noting that the Indian Soft Drinks Manufacturers Association (ISDMA), which is a representation of PepsiCo and Coca-Cola, is also being merged with the IBA. Speaking on the matter Mr. CK Jaipuria, president of IBA"s managing committee and a leading bottler of PepsiCo said, “We are in the process of inviting all affiliates and stakeholders of the non-alcoholic beverages industry to join us”. Meanwhile the IBA will be established on the lines of global organizations such as American Beverage Association (which represents 220,000 people accounting for over $110 billion of sales) and British Soft Drinks Association. The American Beverage Association (ABA) is a representation of beverage producers, distributors, franchise companies and support industries. The scope of the association covers companies related to regular and diet soft drinks, packaged water, juices and juice drinks, sports and energy drinks and ready-to-drink teas. Meanwhile the Indian packaged Juices makers are looking to make use of the IBA for the purpose of expanding their market.Meanwhile expressing his views on the matter Dabur CEO Mr. Sunil Duggal said, “We hope fiscal benefits to the packaged juices sector will continue. Tapping the potential in packaged juices is a long-term effort and we need the government support to do so”. So far packaged juices have only been able to capture a market of 90 million cases a year out of the estimated juice and juice-drinks market of about 660 million cases by volume. Meanwhile the Energy drinks makers of the country are also likely to benefit out of IBA as they need a lobby which can push the authorities for creating industry guidelines for the segment which is currently badly regulated.
Date : Jul-05-2010 17:04
In a bid to establish a single point of interaction for the industry with the government, rivals and industry giants Coca-Cola and PepsiCo have joined hands along with other beverages makers and bottlers to establish the "Indian Beverage Association (IBA)". The association will also help beverage makers and bottlers in compliance issue related to food safety guidelines and other industry regulations.Apart from the two beverage giants Pepsi and coke other majors who have joined in on the initiative include Juices maker Dabur, packaging company Tetra Pak, bottling companies Pearl Drinks and Bengal Beverages, energy drink maker Red Bull, and drip & sprinkler systems firm Jain Irrigation Systems. In addition to the above companies the list includes other 30-40 companies including bottlers, vendors and suppliers are expected to join the association in due course including the likes of Bisleri International, Parle Agro, Amul and Godrej. Speaking on the matter Mr. Arvind Varma, secretary general of the association said, “Non-alcoholic beverages are on a growth trajectory but so far there has not been a comprehensive organization representing the industry. We felt it"s time”. Adding further he said that IBA will act as the point of interaction with the food safety authority and health ministry for the non-alcoholic beverages industry. The IBA will help its members deal with issues like compliance with guidelines of food safety authority, double taxation, VAT, sugar imports and spurious drinks. The IBA will also serve as a unified industry front for dealing with state-level controversies like allegations of water depletion (as is the case with Coca-Cola and PepsiCo). Meanwhile a direct official of the association on condition of anonymity said, “IBA"s formation has been triggered by the two cola companies, Coca-Cola and PepsiCo, since they are the one"s facing maximum flak from regulators — whether it"s VAT in Delhi, charges of water depletion in Kerala or being perceived as only making sugary fizzy drinks by health activists”. The need for such a platform was especially highlighted after a recent decision by the Delhi government to hike the VAT on soft drinks from 12.5% to 20%, earlier this year. The companies have ever since been lobbying with Delhi CM Shiela Dixit to withdraw the hiked taxation under the contention that the same will "reverse their growth cycle". It is worth noting that beverage makers have been reeling under reduced margins ever since the hike as they have not increased prices under the fear that doing so may impact demand for their products. Meanwhile many beverage makers, bottlers and suppliers have expressed their intent on joining the IBA. Meanwhile it is worth noting that the Indian Soft Drinks Manufacturers Association (ISDMA), which is a representation of PepsiCo and Coca-Cola, is also being merged with the IBA. Speaking on the matter Mr. CK Jaipuria, president of IBA"s managing committee and a leading bottler of PepsiCo said, “We are in the process of inviting all affiliates and stakeholders of the non-alcoholic beverages industry to join us”. Meanwhile the IBA will be established on the lines of global organizations such as American Beverage Association (which represents 220,000 people accounting for over $110 billion of sales) and British Soft Drinks Association. The American Beverage Association (ABA) is a representation of beverage producers, distributors, franchise companies and support industries. The scope of the association covers companies related to regular and diet soft drinks, packaged water, juices and juice drinks, sports and energy drinks and ready-to-drink teas. Meanwhile the Indian packaged Juices makers are looking to make use of the IBA for the purpose of expanding their market.Meanwhile expressing his views on the matter Dabur CEO Mr. Sunil Duggal said, “We hope fiscal benefits to the packaged juices sector will continue. Tapping the potential in packaged juices is a long-term effort and we need the government support to do so”. So far packaged juices have only been able to capture a market of 90 million cases a year out of the estimated juice and juice-drinks market of about 660 million cases by volume. Meanwhile the Energy drinks makers of the country are also likely to benefit out of IBA as they need a lobby which can push the authorities for creating industry guidelines for the segment which is currently badly regulated.
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