The industry in Turkey has suffered since rules in 2013 banned alcohol advertising and tightened restrictions on its sale.
The laws, introduced when current president Tayyip Erdogan was prime minister, included a ban on shops selling alcohol from 10pm to 6am, with fines of up to 500,000 lira ($270,000) for owners and operators of venues that violate the law, and a possible one-year jail sentence for selling to minors.
Since then, there has also been successive tax rise.
In July a 7.8% tax hike led to an average 4 lira increase on the price of a bottle of the Turkish national drink Raki, with beer prices rising from around 1.5 to 2 lira per bottle.
Other regulations in force include bans on advertising for alcohol in supermarkets and shops, as well as restaurants and bars, while beverage firms are barred from sponsoring events if they use a visible band logo.
Add into the mix a stuttering economy up to last year, when GDP increased by over 11% after 2016’s 0.8% reduction, it’s not hard to see why beverage companies have struggled.
According to the latest figures from analysts at Euromonitor, overall alcoholic drink sales in Turkey declined in total volume terms, with whisky being the only category to posit a marginal increase.
It added that the alcoholic drinks industry has been badly affected by the adverse economic and political conditions in the country.
Unit price rises
“Another factor that resulted in alcoholic drinks being less affordable was excise tax rises from the government twice a year in both 2015 and 2016, which led to unit price increases," they noted.
“Terrorist attacks in the country also negatively affected the tourism and foodservice industries in the country, which translated into a strong total volume decline of alcoholic drinks through on-trade in particular.”
However, it is hoped a longer-term more positive outlook for the economy and tourism will bolster the sector from this year.
According to the OECD, economic growth of around 5% is expected in 2018 and 2019, while Euromonitor noted: “The economic and political conditions in the country are expected to improve from 2018 onwards, thus increasing consumer demand and driving growth of the tourism and foodservice industries in the country, which will in turn positively affect the performance of alcoholic drinks.”
In terms of the best-performing companies in Turkey, Efes Pilsen remains in the top spot, but it has been losing value share to Türk Tuborg Bira ve Malt Sanayii.