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The global boss of SodaStream says demand for at-home sparkling-water machines is still growing despite the recent failure of local competitor SodaKING and the broader slump in consumer spending.

Victoria-based SodaKING, founded in 2014 to sell the machines and gas cylinders, was placed into administration in early June, although it continues to trade.

SodaStream chief executive Eyal Shohat described SodaKING as a worthy competitor and said he was not happy to hear of its situation.

“I think what happened to them is quite unfortunate,” Shohat said during a visit to Australia last week. “It’s not a softening of the category. I know the numbers; the category’s not going down.”

SodaKING administrators are seeking a buyer for the business.

Shohat said being alone in the category would not be the best thing.

“The greatest form of flattery is competition ... We welcome competition. It also keeps us on our toes,” he said.

Data shows consumers are “trading down” branded items to home-brand and private-label goods given the rising cost of living and reducing spending on restaurant meals, takeaway food and coffees.

Shohat acknowledged the challenges to household budgets but indicated sales had increased since the start of the year.

“In the last year to date, so from January to today, we see growth,” he said. “We started to see a recovery in Australia; it’s actually quite an amazing recovery.”

SodaStream declined to provide sales or revenue figures.

It entered Australia in the late 1970s and has retained market dominance since. Local sales have also been supported by a global branding refresh the Israel-headquartered company launched late last year to reposition itself as a more upmarket product.

Its most recent financial report lodged with the Australian Securities and Investments Commission shows SodaStream’s profits after tax were $2.3 million in 2021, falling from $2.5 million the year prior.

As part of his visit to Australia, Shohat has been touring stores around the country selling SodaStream and said he was impressed by brand repositioning “coming to life” in retailers such as JB Hi-Fi, the Good Guys, Woolworths and Coles.

“I think Australia is the most advanced market in the SodaStream world to implement our new repositioning to elevate the brand to create this holistic ecosystem of beverage for consumers,” he said.

“This market here for SodaStream has been massively growing. We’re getting into more and more and more households all across Australia. Coming here and seeing this, it’s amazing.”

To capture consumer interest and spending dollars, SodaStream recently launched a global marketing campaign aimed at encouraging users to be more creative and experimental with their SodaStream flavours.

Australian infant formula Company, Bubs Australia, has reported a group gross revenue of $20 million for the fourth quarter, marking a 27 per cent increase compared to the previous quarter and continuing the sales growth momentum.

Gross revenue for branded products – excluding B2B and bulk powder sales – amounted to $19.9 million, down 59 per cent on the previous corresponding period (PCP) but up 27 per cent in the third quarter. Its infant milk formula (IMF) also showed promising growth, with group gross revenue up 49 per cent in the third quarter.

Despite being down 59 per cent on the previous corresponding period (PCP), the company remains optimistic about its performance.

In Australia, Bubs fourth-quarter gross revenue of $51.1 million was up 7 per cent year on year and down 3 per cent on the third quarter. The company said with continued shared market growth and additional stockists – including Baby Bunting and Big W – it finished the year strongly with full-year net revenue up 19 per cent and finishing above the guidance range at $15.2 million.

The company’s expansion in the US showed strong results, with gross revenue of $11.8 million for the fourth quarter, up 45 per cent on year and 97 per cent on the third quarter.

Bubs achieved its first $1 million month on the e-commerce platform Amazon in May and continued to see sales growth in June. The company said it remains on track to meet all regulatory requirements for permanent access to the US market. 

Meanwhile, its China business faced challenges due to a dispute with entities affiliated with AZ Global, resulting in excess stock in trade and subdued sales. Fourth quarter gross revenue in the country plummeted 96 per cent on PCP and 55 per cent against the third quarter. 

However, Bubs says it remains hopeful as it sees modest growth and sell-through in cross-border e-commerce for Caprilac, with its sales volume stabilised.

The company has also outlined a multi-channel growth strategy with new leadership and trade partners in China.

Australian tanning and skincare brand Bondi Sands will be acquired by Kao Corporation, a $26 billion Tokyo-listed chemicals and cosmetics giant.

Bondi Sands, the country’s most recognisable self-tanning brand, was founded in Melbourne in 2012 and is now sold in more than 32 countries, including the US and the UK.

Kao Corporation subsidiaries Kao Australia and Kao USA are set to own the Australian brand in a cash deal estimated to be worth $450 million, according to The Australian Financial Review.

Bondi Sands co-founder and chief executive Shaun Wilson said his brand shared values and principles with the Japanese company, which would help it grow globally.

“The integration of Kao’s renowned scientific and technological resources into our operations is an unparalleled opportunity that will significantly contribute to the exponential growth of our brand, empowering us to further expand our product offerings and advance our research and development initiatives,” Wilson said in a statement issued by Kao.

“With this partnership, we can now confidently explore untapped markets, reach more customers around the world and continue to fulfil our company mission.”

Kao’s interest in Bondi Sands lies in the brand’s extensive range of broad spectrum sunscreens, most of which are SPF 50+.

The Japanese giant said it had nominated skincare as a medium-term growth driver and was seeking “aggressive investments” to grow through skin protection and sun-care products. Bondi Sands will give the Tokyo-based giant solid footing in the self-tanning market.

Karen Frank, president of Kao’s consumer care business in the Americas, Europe, Middle East and Africa, said Bondi Sands would be a perfect fit for its portfolio, which includes John Freida, Biore, Jergens, Curel and more.

“Quality, innovation, environmental responsibility, accessibility and community are at the forefront of everything it does, ideally aligning Bondi Sands to our own brand values and corporate philosophy,” Frank said.

“The addition of Bondi Sands to our consumer family of brands will greatly advance our mission to be the pre-eminent leader in the global skin protection business and continue our journey of offering diverse products that promote a ‘kirei’ [clean and beautiful] lifestyle that is healthy, inclusive and sustainable for all.”

Bondi Sands and Shaun Wilson have been contacted for comment.

The deal is subject to “normal regulatory review and approval” according to Kao’s statement.

Last year, Bondi Sands faced a US class action for alleged greenwashing over its claims that its sunscreens were “reef friendly”. The self-tanning brand’s first batch of products turned customers green and had to be recalled.

“It was not the greatest start,” Wilson said in January 2020. “The quality control of one of the ingredients was not up to scratch and we had to do a recall. We faced up to it and were honest with our wholesaler Priceline and they gave us another chance.”

Bondi Sands is the latest in a string of Australian brands that have been sold to international conglomerates.

Craft gin distillery Four Pillars was sold to Japanese-owned beverages giant Lion in early July, while Melbourne-born luxury cosmetics brand Aesop was snapped up in April by Brazilian owner Natura & Co Holding for $US2.53 billion ($3.7 billion) in the biggest deal for a luxury brand in Australian history.

Japanese giant Suntory will merge its two drinks businesses in Australasia to create a $3 billion-a-year company that will see alcohol brands including Jim Beam and the No.2 ready-to-drink spirits brand -196 brought under the same roof as non-alcohol products.

The non-alcohol brands include Australia’s biggest selling energy drink, V Energy, which is outpacing fierce rival Red Bull. It also sells Maximus and Boss Coffee.

The new Suntory Oceania entity will be up and running by mid-2025, and means Coca-Cola Europacific Partners will hand back a contract after 16 years of Coca-Cola entities operating the local manufacturing, sales and distribution of the Suntory Beam alcohol brands.

Coca-Cola Amatil, the former ASX-listed Coca-Cola bottler in Australia which previously held the rights since 2009, was swallowed by Coca-Cola Europacific Partners in a $9.8 billion buyout in 2021.

Darren Fullerton, chief executive of Frucor Suntory, said the non-alcohol business had generated sales growth of 10 per cent-plus in calendar 2022 and sales continued to be solid. The alcohol brands had also been generating good growth of high single digits. “Both of these businesses are in significant growth,” he said.

Suntory has started building a $400 million manufacturing and distribution facility at Ipswich in Queensland on a 17ha site which will have an initial production capacity of 20 million cases of ready-to-drink products annually. It will give extra impetus to Suntory’s growth plans. There is also a production site in Auckland.

“It’s been a bit of a sleeping giant in this part of the world,” Mr Fullerton said.

Suntory had been weighing up its strategic options and had decided that to take full control of both businesses and merge them into one was the best way to accelerate growth.

“The timing, for a number of reasons, was right,” he said.

‘Hourglass effect’

The two businesses currently operate separately and have a combined workforce of 1100.

Beam Suntory brands include Jim Beam, Maker’s Mark, Canadian Club whisky and Hibiki Japanese Whisky, but one of the biggest profit drivers is the ready-to-drink brands known as -196, a low-sugar product which is hugely popular in Japan.

It first arrived in the Australian market in 2021 and has risen to be the No.2 light RTD in Australia. The name comes from the extremely low temperature at which lemons are frozen before being crushed into a powder used in the drink.

The Frucor Suntory business’ flagship product is V Energy, in a distinctive slim green can. It is the No.1 energy drink in Australia, having overtaken Red Bull.

Mark Hill, managing director of Beam Suntory, said Coca-Cola entities had done a good job in overseeing the alcohol brands, but it was time for Suntory to take control and step up the growth.

“It was the end of the agreement. It’s nothing against them,” Mr Hill said. Coca-Cola Amatil had signed in 2015 a new 10-year agreement to make, sell and distribute the alcohol brands in Australasia for the following decade.

He said there had been some softness in parts of the alcohol market in the past few weeks as cost-of-living pressures increased in households.

“We’re only starting to see that in the past couple of months,” he said. “In some areas, there is a bit of an hourglass effect.”

He explained that the high-end premium segment was still strong, with affluent drinkers still spending up, and that the bottom end of value buyers was still solid. But cutbacks in discretionary spending by middle Australia had caused softening in the mid-market.

Across the two businesses of alcohol and non-alcohol brands, the combined retail value of annual sales is around $3 billion for sales in liquor chains, supermarkets, convenience stores and hotels and bars.

The alcohol brands generate solid sales in liquor chains such as Dan Murphy’s and BWS owned by Endeavour Group, and the liquor chains run by Coles Group.

Beverage companies Beam Suntory and Frucor Suntory have announced a $3 billion multi-beverage partnership in Australia and New Zealand for premium spirits and non-alcohol segments.

The combined company will become the fourth-largest ANZ beverage group in Oceania taking over “full end-to-end control” of its portfolio in manufacturing, sales, and distribution.

The deal follows an announcement yesterday by Coca-Cola Europacific Partners (CCEP) and Beam Suntory that they would end their 16-year partnership in Australia and New Zealand, effective upon the expiry of the contracts on June 30 and December 31, 2025, respectively.

Despite the ownership overlap, the two companies are not merging, but partnering up.

Frucor Suntory CEO, Darren Fullerton, said the new venture is about “bringing the best” of Suntory to Oceania.

“With the ability to accelerate our growth trajectory, we strongly believe it will redefine market dynamics and offer more consumer beverage moments from sunrise to sunset, unlocking innovation for our customers across retail and hospitality industries.”

Mark Hill, MD of Beam Suntory Oceania, said the collaboration demonstrates the company’s belief in the growth potential of the Australian and New Zealand markets.

The business has also made a $400 million investment in the construction of a new net zero facility in Ipswich, Queensland which will complement its current manufacturing operations in Auckland.

The new Queensland site will become home to additional beverage processing, packaging, warehousing and distribution operations and will be able to produce 20 million cases initially.

It is expected to be operational by the middle of next year and will assist in manufacturing more than 50 million cases in the future.

Although preparation is currently underway, the partnership will only become effective from mid-2025 in Australia and 2026 in New Zealand.

Health and wellness brand PharmaCare has purchased Bounce from administrators, expanding its natural health foods range.

Bounce is known for its protein balls and other health snacks, however, the company recently collapsed under heavy debt.

The company said Bounce’s acquisition strategically complements its focus on building a portfolio of brands that positively impact people’s lives with “high-quality and delicious” products that are easily accessible.

Glenn Cochran, CEO, PharmaCare, said adding Bounce to the company’s portfolio underscores PharmaCare’s commitment to growth through local acquisitions.

“We have a strong team of experts in the natural health sector who are already putting their collective minds behind the brand’s success to support Bounce customers to achieve a seamless ownership transition,” said Cochran.

Bounce joins PharmaCare’s health foods division together with its Go Natural brand. 

According to the company, its first priority would be driving continuity with Bounce’s existing customer network to support consumer demand. This involves reviewing the product range and focusing on the 11 core products, such as Protein Balls. 

“Our team is excited to continue supplying the beloved Bounce balls and more to Australians across the country who enjoy healthy snacking on the go,” Cochran concluded. 

Bounce is PharmaCare’s 28th brand, joining Nature’s Way, Sambucol, Bioglan, SUP Supplements and others.  

Vodka makers are taking a leaf out of the gin-making playbook, using botanicals and blends to create innovative flavours, says the International Wines and Spirits Record (IWSR).

Despite being “outshone” by other spirits in recent years, things are starting to change for the category as new product launches tap into contemporary and crossovers. 

Pre-mixed and RTDs

Because of increased demand for convenience, the pre-mixed and ready-to-drink (RTD) formats have grown in popularity. 

RTD cocktails, for example, saw global volumes increase by 10 per cent in 2021-22 and are expected to grow at a CAGR of 6 per cent from 2022-27. 

The study said vodka is well-placed to capitalise on these trends as spirits-based RTDs were set to replace the hard seltzer boom a few years ago.

Highlighting the classic cocktail trend include those from Billson’s with its lollipop-inspired Sour Blueberry vodka premix and Mishka’s fruit-flavoured RTD pre-mixed vodka.

Flavoured expressions

More recently, vodka makers are not just highlighting the flavours in its raw materials but also have begun using additional ingredients – including natural botanicals and extracts – that expand the drink’s flavoured expressions from subtle to overt.

These new flavours bridge the gap between gin and vodka categories and appeal to consumers familiar with botanical spirits and those not interested in sweet or artificial-flavoured vodka. 

In addition, because these spirits are distilled and not generally sweet, they tend to be low in calories and resonate with health-conscious consumers. 

Sustainable spirits

According to IWSR data, sustainability has been a growing trend in the spirits category, with vodka brands presently highlighting their origins.

Aside from their heritage, brands also present transparency on the ingredients used and the vodka’s distillation process.

An example of a sustainable spirits brand is 80 Proof Australia’s Ugly Vodka, with part of its base spirit made from apples that would otherwise be thrown away. The brand’s first batch is said to have saved 20 tonnes of apples from going to waste.

Move to premium

According to the IWSR, vodka, as with the spirits category in general, is leaning towards more premium launches. 

Data shows that the growth of the total vodka market has been “largely flat” and is expected to remain so over the next five years.

However, the global premium-and-above segment has seen more positive growth, expanding in consumption volume by over 6 per cent last year, with an expected CAGR of over 3 per cent during 2022-27.

Tasmanian charity Elsie Cameron Foundation has become the new owner of craft beer company Tribe Breweries, rescuing it from voluntary administration.

The brewery, which produces for brands such as Stockade Brew, Mornington Peninsula Brewery, and Wilde, has also appointed Heath Baker as its new CEO.

Baker told Shout that the completion of the administration process “marks a fresh start” for the brewery.

“We are extremely proud that despite this challenge, we maintained supply to all of our customers throughout the process and now with the business on renewed footing, this enables us to provide more certainty for our employees, customers and suppliers.”

Baker, who was the former GM of Tribe Breweries, has more than 25 years of experience in the corporate drinks and brewery business and was the former head of international alcohol at Coca-Cola Europacific Partners.

In his new role, he will oversee the day-to-day operations of the business and help scale its brands.

Food & Agribusiness Network (FAN) has named Nicole McNaughton as its new CEO after the successful cluster secures additional funding. 

McNaughton joined FAN in 2018 and has collaborated with the team and key stakeholders to acquire considerable financing to implement plans and programs. She worked with approximately 370 members, major partners at all levels of government, and premier academic institutes to improve the region’s food and beverage offerings. 

“Securing significant funding this year, to showcase and build capability in food and agribusiness tourism and roll out a new accelerator program, is the start of the next incredible journey for our regions,” she said. 

“It’s a great example of the work we conduct behind the scenes, where we connect with and work alongside key partners and stakeholders to be the conduit of connections and opportunities for our members and industry.” 

The chair of FAN, Jacqui Price, said Nicole has been acting CEO since late 2022 and has shown “wonderful devotion” to the post, providing more money for capability programs and searching out fresh methods to promote FAN’s work.

The battle for budget groceries is heating up as competitors to supermarket giants Coles and Woolworths, including Costco and Aldi, say their value offers are resonating with cash-strapped shoppers.

A flurry of competition on essential items comes as a UBS investment bank survey of suppliers last week suggested food inflation would moderate significantly but was expected to sit at about 4.8 per cent over the next year.

This inflation rate is expected to “prompt consumers to trade down to smaller pack sizes, private label and/or to Aldi”, UBS said in a note to clients, making Aldi the most likely business to grow market share over the next six months.

The German discount supermarket has been upbeat about its position in the face of the cost of living crisis. The company said last month that many shoppers had been coming to its stores for the first time recently, and it was gradually increasing the size of its shops.

“[Shoppers] might come in for meat, and it might take them a month, or two months, but they start exploring different parts of the range,” Aldi’s director of customer interactions, Adrian Christie, said.

Aldi is not the only grocery challenger looking to capture value-conscious consumers. The managing director of Costco in Australia, Patrick Noone, said the membership and online warehouse was still in expansion mode in Australia, and that food and fuel had been the company’s most popular categories in recent times as shoppers demanded more value on essentials.

“Costco offers a wide range of quality, brand-name items at the best possible prices,” he said. “A lot of these items are everyday essentials that provide the savings members are looking for. We also add a layer of competition to the grocery market and extend the choice of the consumer.”

IGA operator Metcash is also working on ways to deliver for value-conscious consumers, and has been trialling a new store format called Supa Valu, with two sites so far in NSW and one in Victoria.

“The format is designed to offer these shoppers amazing value on their weekly shop through our bulk buying, locking more prices down for longer, along with extra low prices on weekly specials for key items such as meat and produce,” said Metcash Food chief executive Grant Ramage.