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Sweet drinks companies offer alternative products to overcome the impact of the "selective tax"

2019-12-14T22:08:39.657Z

Recently, after the application of the selective tax, the retail markets in the country witnessed the expansion of companies to produce sweetened drinks by offering new juice products without sugar, in addition to fresh juice products in stores and cooperative societies. Officials told «Emirates Today» that they are implementing plans to



Finally, after the application of the selective tax, the retail markets in the country witnessed the expansion of companies to produce sweetened drinks by offering new juice products without sugar, in addition to fresh juice products in stores and cooperative societies.

Officials told «Emirates Today» that they are implementing plans to rely on alternative products, focused on expanding to offer products with 100% fruit contents, and new products will be launched in the future, in addition to offering promotional offers on taxable products, in the framework of facing the effects of the application « Selective Tax », since the beginning of this December, on sweetened drinks in the markets.

In detail, a field tour of "Emirates Today" on major retail outlets in Dubai and Sharjah monitored the expansion of companies in producing sweetened drinks to meet the selective tax, by introducing new juice products without sugar additives, and increasing the supply in stores and associations of products for multiple brands of juices Fresh, while the markets witnessed the proliferation of fresh juice products that extend their mandate for long periods.

The tour showed that some companies have resorted to developing classifications of sugar levels in juices, under the names of low sugar or low sugar, while other companies have resorted to intensifying offers of promotional downloads on juice products that included added sugar and are subject to tax, by selling two or three packages of juice at low prices compared At prices sold separately.

In turn, the CEO of "Foods" group, Tariq Ahmed Al-Wahidi, said that "applying the tax on sweetened drinks to reduce people's consumption of products that contain sugar in large quantities is one of the initiatives that have beneficial health effects, and they are applied in different countries around the world", indicating “With the effects of applying the tax on the market, the trend is more towards sugar-free products, especially after the rise in prices of sugar-added products, after the tax, and within that framework the group worked to focus and expand the supply of fresh products and other products classified as containing 100% fruit juice ».

He pointed out that "the group proposed an initiative for fresh juices, but by using high-pressure pasteurization systems, not by the heat system, which juices lose vitamins and their taste, and therefore fresh juices were provided that extend their powers for a longer period compared to other fresh juices", indicating that it is expected that the market will witness demand On products with 100% juices and fresh juices during the coming period.

For his part, Chief Executive Officer of Al-Rawabi Juices and Dairy Company, Dr. Ahmad Al-Tijani, said, “It is natural that the application of the selective tax on the sweetened beverage sector will have impacts on the demand for sales of juices and dairy added sugar, which motivated companies to resort to alternative products or plans. Development, and those who will not keep pace with these changes in the markets will be exposed to negative effects in sales ».

He added that «the company has worked to expand the offering of juice products without added sugar, and depends on 100% fruit juices, in the context of operations to confront selective tax variables, and at the same time there are continuous research and development plans to study alternative products that depend on natural sweetening and without changing the taste For juices and not subject to tax ».

He pointed out that «consumer demand is expected to move more towards non-taxable juices, in which the juice percentage is 100%», pointing out that “companies tend to develop alternative products that may have an additional cost whose effects are reflected in the margins of profit rates for companies from These products, especially with an attempt to avoid the effects of demand tax in the early stages of implementation.

In the same context, General Manager of the National Foodstuff Company, Milco, Achim Wollner, said that the company is facing variables in applying the selective tax on sweetened drinks since the beginning of this month, by expanding the supply of products containing 100% fruit juices without sugar, in addition To make development plans that focus on how to introduce additional alternative products that are appropriate to the new situation on the market, and at the same time be without added sugar, and of natural sweetening to suit the tastes of consumers ».

He pointed out that «the demand is expected to grow more in the markets during the coming period for sales of juices with components of 100% of fruit juice without sugar, with the rise in prices of traditional juices that make the price differences close», pointing out that it is natural for prices to be Juices with a concentration of 100% higher than products with a concentration of juices in them by 10% on the market or "nectar" juices that contain juice concentrations of 30% or higher.

He added that «the development of alternatives to juice products without added sugar and a good taste for consumers is difficult, because most consumers in the markets are used to juices with added sugar, and it is preferable to sweet taste, especially since some types of fruit are characterized by sour taste and need to be sweetened in different types.

Source: emara

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