Fifco capitalizes on growing consumption of flavored alcoholic beverages. How about beer?

The added value of these drinks is that they are simpler types of cocktails, they are usually softer and have flavor combinations that appeal to the palate, which makes them ideal for those who don’t like strong flavors or don’t like strong flavors. Another facility they offer is They are ready to drink. Good for its consumption and popularity.

Apart from, These drinks are available It goes hand in hand with the trend of people being more responsible for their diet and health, which is why they look for options with lower alcohol and sugar content per container.

Although Fifco does not reveal specific figures for products in the category due to commercial strategy, the company’s comprehensive report states that drinks such as Adam and Eve, Bamboo or Smirnoff Ice have recorded sales.

Cuba Libre, Seagram’s Escapes and Lipton Hard Tea round out Fifco’s portfolio, although the latter two are more focused on the North American market.

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Furthermore, it must be added that the United States is the market where these preparations are taking off, especially with the Hard Seltzerwhat are these BAS but no sugar The alcohol content is similar to beer.

If you have been to a supermarket recently, you may have noticed a greater availability of such products, but this trend is not unique to Costa Rica. It is replicated in other markets close to us, which is why Fifco plans to take advantage of this situation.

“BAS is a category in Fifco’s portfolio that has been showing growing and sustained behavior. This is likely due to the global trend of a new generation seeking alternative presentations of beverages and different consumption occasions, as well as a preference for drinks with lower alcohol content per presentation,” said the company.

Now, this doesn’t mean that beer consumption is decreasing, quite the contrary. Fifco says the products are still the cornerstone of the segment, but they are not growing as fast as BAS and appear to be rapidly shifting to healthier presentations.

There is no doubt that beer is now facing more intense competition within and outside its niche. This has led brands to also opt for domestic and imported zero-alcohol and zero-calorie products.

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“The flavor of distilled spirits develops with age. If we talk about products such as beer, they have a clear niche. In fact, this type of product (BAS) has managed to capture a niche that is consumed in a mild setting, seeking a delicate flavor without going overboard,” said Ginnette Quesada, professor of business administration at Federica University.

Beverages are key to business expansion

The growing demand for these drinks is not unique to Costa Rica, and it is this high demand that has allowed Fifco to enter other markets. Even in other countries that are larger than Costa Rica, unique flavors and presentations have been introduced.

For example, last year the Costa Rican company began operating in the Dominican Republic, a major market in the Caribbean, with its introduction letter being BAS, specifically the Bamboo and Adam and Eve brands. Fifco produces in Costa Rica and in partnership with Grupo Corripio.

In the United States, business alliances are also key to the implementation of Fifco’s business strategy: they have established links with Diageo and PepsiCo. Through the latter, they have acquired the rights to develop and market Lipton Hard Iced Tea since last year. On the other hand, Seagram’s Escapes remains one of the most popular drinks in this North American country.

The brand ranks second in the category in Mexico. Since mid-2020, the country has also sold three exclusive Smirnoff whiskies: Tamarindo Picosito, Peach Mango and Lemon Lime, as well as the Bamboo Paloma flavor, which is only available in the country.

In the Panamanian market, Cervecería Panameña will take over Fifco’s BAS portfolio to expand coverage in this market.

Beverages, the fastest growing category

Overall, beverage sales increased by 10% in 2023 compared to the previous year. According to the company’s financial statements, the operating profit of this business category was 120.188 billion euros, compared to 108.874 billion euros in 2022.

Fifco’s operating profit totaled 134.217 billion euros last year, a record high, of which 89.5% came from beverages. The second most important segment is real estate, where Fifco derives revenues from the operation of the Westin Reserva Conchal and W Costa Rica hotels in Guanacaste; in this activity it achieved an operating profit of 11.464 billion euros.

Analyzing the figures for the first quarter of this year, Fifco reported net beverage sales of 161,213 million euros and operating profits of 33,993 million euros.

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In addition to alcoholic beverages and spirits, Fifco’s portfolio also includes soft drinks, juices, hydrants and non-alcoholic beer.

When was BAS launched?

Flavoured alcoholic beverages have been on the market for 20 years. Fifco started out with Smirnoff Ice in 2004 and has since expanded its portfolio thanks to an alliance with Diageo.

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Another striking point is that the pandemic has halted most sales of all types of alcoholic beverages in bars and restaurants, but household consumption has increased, which could be beneficial to the growth of BAS.