According to industry analysts at Euromonitor International, the food and beverage (F&B) industry in Asia Pacific is estimated to accumulate total revenue of US$3.23 trillion in 2016. Despite the slowing economy, China, Japan and Indonesia are recognized as leading F&B producers in Asia Pacific.
Source: Asia Pacific Food Industry
From the above chart, the top three categories – grain mill products, oils and fats, meat and meat products – account for at least half of Asia Pacific’s US$4.86 trillion food industry revenue in 2016. These are labeled as Asia’s leading food drivers.
Source: Asia Pacific Food Industry
Asia Pacific beverage industry’s revenue will make up 11% of the combined F&B industry in 2016, after hitting US$365 billion. Health awareness will expedite the expansion of functional beverages – drinks that have vitamins, minerals, amino acids or raw fruits. The growth for carbonated drinks might decline as health conscious consumers switch to beverages with lower sugar content.
The adoption of a “healthy lifestyle” is another factor impacting the consumption of food and beverages. This becomes fuel for producers to constantly innovate across supply chains to provide healthier options to consumers. Asian consumers are more educated and conscious in healthy eating. They are willing to pay more for organic, gluten-free and low-caloric foods. Customers are therefore less price sensitive when dining in restaurants that pride in serving their diners healthier options.
Consumers are also becoming more environmentally conscious and eco-friendly. Restaurants that have a strong corporate social responsibility (CSR) are more appealing to customers. These include donating excess edible food to the destitute, reducing food wastage, killing of animals in a humane manner and using recycled napkins etc. From the Journal of Business Ethics (2014), studies revealed that consumer evaluations are enriched when they know restaurateurs have an existing reputation for CSR and provide healthy product offerings for diners.
Singapore’s F&B industry remains unfazed despite facing turbulence in the retail sector. Many new entrants continue to sprout in the F&B industry. A survey conducted by Commercial Real Estate Services (CBRE) reveals that Singapore comes in second in Asia Pacific for the number of newly established cafes and restaurants. The inference being that there are still opportunities for international retailers to enter the retail market as rents decrease, creating a positive outlook in the F&B industry.
Despite increasing demand by consumers for healthy food, consumers in Asia Pacific will be price sensitive as the economy is slowing down. Therefore, restaurants should overcome this obstacle by seeking unique ways where they can implement a healthier menu in order to stay competitive, attract more consumers and be cost-effective.