Britvic Soft Drinks's acquisition of Orchid Drinks could lead to a spate of new launches in the adult lifestyle and organic drinks sectors.
The company is likely to leverage Orchid's expertise in herbal drinks such as Amé, Aqua Libra, Purdey's and Norfolk Punch and exploit its knowhow in organics. The Orchid factory that makes organic drinks for the Duchy Originals brand has Soil Association approval.
Britvic has already identified the adult market as a key opportunity for growth in its Right Choice category management programme. Marketing director Andrew Marsden said the acquisition was a logical fit that would help consolidate and drive Britvic's presence in this sector. Other Britvic products targeted at adults include R Whites lemonade and Robinson's Barley Water and High Juice.
Marsden said the Orchid brands had been underutilised and he aimed to move them from being niche products (albeit with a loyal following) to mass market products.
In particular Britvic aims to push distribution of the Orchid portfolio in the impulse sector and in the on-trade. Current distribution is primarily through multiple retailers.
"We bring resources and scale, as well as a strong brand focus, and we will apply our marketing nous to really make this category hum," said Marsden.
The Orchid porfolio is worth £16m with year on year value growth of 28%. Marsden said the aim is to double sales though he did not reveal a timescale on this.
"We wouldn't buy it if we couldn't drive it," he said.
The adult soft drinks category is a profitable one for retailers, often offering up to 50% better margins than the average soft drink. Amé and Aqua Libra retail at £1.99 and Purdey's at 99p.
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