Earlier this year the Bolst Global team attended the annual Gulfood exhibition at the Dubai World Trade Center to represent our clients and develop their businesses internationally, as well as to build on our business insights into the global food and drink industry.
In addition to Gulfood we have undertaken additional UAE market visits over the past few months for business development and market research purposes. We wanted to share our insights via this photo blog and so take a look and see what the UAE could bring you opportunity wise!
The growing appetite for healthier choices has been the main driving force for the increase in health food and beverage sales in the UAE over the past few years. Health drinks have been performing particularly well across all categories, both reported by Euromonitor and seen by us.
The increased awareness of health problems and the new search for healthier lifestyles amongst both the large 90% ex pat population and the Emirati community has triggered success for nuts, seeds and trail mixes as well as for vegetable, pulse and bread chips with both product categories posting the retail current value growth rates of 20% in 2017, as they are seen as healthier options to more traditional savoury snacks.
Local health snack brands such as Munchbox and HunterFoods are doing very well on the market, providing conveniently packaged healthy snacks, such as energy balls, nut bags, pretzels and healthy baklava.
Regarding food and drink retail landscape, hypermarkets and supermarkets are the leading force as distribution channels for foreign brands exporting in the United Arab Emirates. There is a consumer preference for one-stop grocery stores for all food and drink subcategories, which has caused a continuous growth in retail outlet numbers.
The sales of health and wellness products by category between 2011 and 2016 had increased as follows: In the Better For You segment from 5.8% to 40.8% value growth; Fortified/Functional from 8.2% to 48.4%; Free From from 19.1% to 115.0%; Naturally Healthy from 8.4% to 54.4%; Organic from 11.6% to 90.9% and Health and Wellness segment from 8.2 to 51.7% value growth according to Euromonitor.
There is therefore a clear opportunity for organic products in the UAE as well as free from items and if your product can fall into various categories then you have even greater chances of success and uptake by the UAE retailers, distributors and consumers.
Sauces, dressings and condiments registers retail value growth of 8% to reach 115.81 million GBP in 2017. This market is mainly driven by expatriates (approximately 80% of the population in the UAE) diversifying their food recipes with these products, which explains the success of sauces like chili sauces and sauces used in Asian cuisine such as soy sauces.
This high levels of diabetes in the country have triggered a strong shift in consumer attitudes towards sugar. The government is considering putting a sugar tax into place in 2018 to regulate the soft drinks industry and has adopted stricter regulations relating to the types of health claims that can be printed on the packaging of beverages. According to Euromonitor UAE’s hot drinks, packaged food and soft drinks sub-sectors are going to grow annually by 8, 9 and 5.4 per cent 2021-22. With the consumer shift towards healthier beverage choices, sales of RTD tea have increased consistently since 2003, with the current growth rate of 8%, reports Euromonitor. The UK brand Lipton Tea holds the biggest market share of 57,1% of the UAE ready-to-drink tea. Food service could be a good angle for brands looking to enter the UAE market as a channel where less competition can sometimes be found.
Sports nutrition and health and wellness products are experiencing a boom in the UAE due to increasing awareness of health problems such as diabetes and obesity. Health and Wellness beverages in particular are expected to grow by 31,6% between 2017 and 2022. Fortified/functional bottled water registered the highest growth rates in 2016, rising in current value by 13% from a low base.Among sports nutrition, protein products are the most successful. Protein bars recorded a value growth of 363.3% between 2012 and 2017 and are expected to grow a further 22.7% value between 2017 and 2022. The 2015 Nielsen Global Health and Wellness survey showed that the Middle Eastern respondents are interested in purchasing packaged foods that contain a high percentage of protein and that are filled with nutritious minerals and vitamins. The consumers’ responses showed that they would be willing to pay a premium price for these high-end wellness products and generally most protein products retail in excess of 2 per unit, often nearing 3 depending on the size of the product and the retail outlet or gym distribution channel.
According to FBMG, the UAE’s F&B market will grow from 7.75 billion GBP in 2015 to 9.05 billion GBP in 2018. Free from, organic and vegetarian-friendly products are also on the rise no matter their category which is one more indicator of potential success for the foreign brand exporters. Having said that there equally needs to be a balance between the product offering and the price that is asked for as retailers and consumers are looking for gaining quality but for the most affordable prices possible.
Like what you see here and would like to export your product to the UAE with the help of Bolst Global?
We can also carry out specific project led work in the UAE for you. Contact us here with a few more details of what you need help with.
Or for how we can be your outsourced export department, or an extension of your existing one then check out our dedicated Export Management Service here.