Monday, September 8, 2008

Worry about Coca-Cola's Taken Over of Chinese Huiyuan Juice

All Chinese are shocked by the lastest news about the Coca-Cola bids for China's Huiyuan. Now, it's already a done deal, and we are losing one of our big native brand. Many native juice makers will be influenced in the long run.

Coke offer for Huiyuan triggers widespread worry

While Coca-Cola and Huiyuan both seem satisfied with the deal, many ordinary Chinese think otherwise. In an online poll posted by major portal, more than 80 percent of the over 76,000 interviewees voted against the acquisition of the leading domestic juice maker. A similar proportion held the opinion that the acquisition, if successful, would verge on a foreign capital's attempt to wipe out domestic pillar brands.

Having just been listed among the top 25 domestic brands last year by China Brand Union Association, Huiyuan had the largest share in the Chinese juice market and was the pride of many Chinese as an example of a domestic brand that competes successfully among its international rivals.

"Huiyuan would become a brand under Coca-Cola, which has achieved a major strategic triumph. It will get not only the top brand in China, but also the market. It would take Coca-Cola back to the top of the Chinese beverage market," said brand marketing expert Li Guangdou.

"But it would mean a heavy loss to Chinese domestic brands, which are under severe crisis now," said Li.

Big Market Potential

By 2025, China's middle-class is projected to exceed 600 million. That's twice the size of the entire population of the United States. And a great many of those people will be drinking Huiyuan products.

Sales of fruit and vegetable juices in China will grow 16% to $12.3 billion this year alone, according to Euromonitor International, whereas carbonated beverage sales are only forecast to rise 7% to $7.94 billion.

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