Root Beer Market: Regulatory Challenges and Opportunities for Growth
The global root beer market size is anticipated to reach USD 1.09 billion by 2030, registering a CAGR of 4.6% over the forecast period, according to a new report by Grand View Research, Inc. Root beer is a North American drink that’s been traditionally made using the root bark of the sassafras tree. Sassafras was banned by the Food and Drug Administration (FDA) in 1960 owing to the presence of safrole, a carcinogenic component. Thus, most commercial root beers available in the market contain the artificial flavoring of sassafras. However, some companies, such as Hansen Beverage, use safrole-free sassafras extract to retain the authenticity of root beer.
The global market is predominantly driven by the increasing demand for low-alcoholic beverages, the growing number of hotels, restaurants, & bars, and the increasing interest of millennials in exotic and new flavored drinks globally. With the changing lifestyle of consumers across the globe and increasing disposable income levels, the demand for services like restaurants, hotels, clubs, and bars is rising. This, in turn, is expected to favor the growth of the global market over the years to come. The outbreak of Coronavirus disrupted the distribution channel and supply chain of the global market owing to the closure and restrictions on bars, restaurants, and hotels. The overall market observed a slight dip in growth in 2020.
Gather more insights about the market drivers, restrains and growth of the Global Root Beer Market
However, the sales from off-trade channels, such as supermarkets and e-commerce, were observed high during the lockdown period. The COVID-19 pandemic shifted consumer preference for root beer over other liquors as it contains no or small amount of alcohol, which makes it a healthier option over other drinks. New product launches, mergers & acquisitions, and geographical expansion are some of the key strategies adopted by market players to strengthen their industry position. For instance, in 2018, JAB Holding Co. entered into a strategic agreement to merge with Dr. Pepper Snapple Group through its Keurig Green Mountain business unit. The merger of both the companies formed “Keurig Dr. Pepper”. The combined companies offer various products under brands, such as A&W Root Beer, 7UP, Dr. Pepper, and more.
Root Beer Market Report Highlights
- The conventional product type segment accounted for the maximum revenue share of the global market in 2021
- The alcoholic product segment is expected to witness the fastest CAGR over the forecast period on account of the increasing consumer inclination towards low-alcoholic drinks
- The off-trade distribution channel segment is projected to register the fastest CAGR over the forecast period
- Supermarkets & hypermarkets, in particular, dominated the off-trade segment in 2021. The COVID-19 pandemic increased the off-trade sales of the product
- Europe is the second-largest regional market in the world. Countries, such as Germany, Italy, and France, are the major contributors to the regional market growth
List of Key Players of Root Beer Market
- Keurig Dr. Pepper
- Anheuser-Busch Companies, LLC
- Blitz-Weinhard Brewing Co.
- Dad's Root Beer
- Sprecher Brewing Co. Inc.
- The Berghoff
- Bundaberg Brewed Drinks
- Whole Foods Market IP, L.P.
Order a free sample PDF of the Root Beer Market Intelligence Study, published by Grand View Research.
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