China’s “dual circulation” growth strategy will foster domestic consumption and create investment opportunities in the food and beverage (F&B) industry, Nathan Yu, Portfolio Manager, Eastspring Investments, is convinced. “New trends and changing consumer preferences are benefitting brands that focus on health, convenience and innovation”, Yu writes in a recent insight.
He highlights three areas that are driving change and growth in the F&B industry in China:
- Chinese consumers have begun to prioritise better health and a better quality of life. As a result, products aligned with healthier lifestyles have seen increased demand. At the same time there is an emphasis on premium brands.
- E- commerce is a vital part of consumer shopping behaviour in China. Online habits acquired since the pandemic, improved infrastructure & distribution channels plus brands shifting online are expected to accelerate e-grocery penetration rates in the next few years.
- Innovation in F&B is becoming more important, whether it is in terms of packaging, new products or marketing channels. Instagrammable foods, for example, appeal to younger consumers.
Read more on Eastspring.com/lu.