The current state of the SA Spirits Industry: An update

The current state of the SA Spirits Industry: An update

During the height of the pandemic in 2020 and 2021, there were major interruptions in the South African spirits industry’s strong momentum. Strict lockdowns implemented by the government, as well as a total ban on alcohol sales, have harmed the industry in many ways. 

Not only did producers take a huge financial hit but plans to roll out new and exciting products were put on hold, leaving the industry stagnant. It is estimated that the bans and restrictions on alcohol cost the broader liquor industry over R45bn between March 2020 to July 2021.

However, two years on, and the local spirits industry is showing positive signs of making good gains once again. But how exactly is the current market faring against the mid-pandemic state as reported in 2021

The current state

Although there is still plenty of work to do to fully recover from the challenges faced during the pandemic, the industry is slowly but surely getting back on its feet.

Considering that the spirits per capita consumption rates in South Africa are higher than the global levels, it may not take long for the industry to reach pre-pandemic status. 

Now that shops can once again sell alcohol without any restrictions and events are taking place throughout the country, craft distilleries can also renew their plans for developing and launching new products. Marketing efforts can also be revived as increasingly more consumers are shifting away from buying global brands to supporting local businesses.

The road ahead

In 2021, the South Africa spirits market was valued at $5.2 billion in 2021. This figure is projected to grow at a compound annual growth rate (CAGR) of more than 6% over the next four years. 

While there are still some challenges, including finding ways to compete with global labels and keeping production costs low, there is a bright future for the industry. The important thing is that producers get the right support from key authoritative role players, as well as consumers, in the coming months. 

Leave a comment

Send a Comment

Your email address will not be published.