What is the firm's strategy to position Pepsi Oman in the region?
Since its inception 42 years ago, Oman Refreshment Company (ORC) has established itself as a market leader in its core product portfolio in Oman. It is focused on maintaining its market leadership in the F&B product segments that it operates, while sustaining its profitability levels and shareholder returns at the current level and grow upon that base. Despite the new challenges emerging from the fundamental economic conditions impacting the business environment in the region and Oman, immediate opportunities for growth will continue to be in its core beverages and food segment (PepsiCo products) with the growing local population as well as government commitment to continue spending on major infrastructure projects that have been announced and are ongoing in the country. Launching innovative products to meet changing consumer preferences and tastes are expected to attract and maintain customer loyalty to ORC.
What has been the demand and evolution of beverage and snack products in Oman?
Our core consumer offer is ready-to-drink (RTD) beverages and ready-to-eat (RTE) salty and sweet snack products. The demand for RTD and RTE products is growing in Oman as consumers are looking for high-quality products to fill diverse consumer needs from youth to advanced age, as is evident from their expanding space and range on the shop shelves. Though consumer preferences and tastes are continually changing, the price sensitivity of Omani consumers is playing an important role in gaining market foothold for new products and new entrants. ORC, with its large category base, is perfectly positioned to cater to Omani consumer needs in the segments where we operate. The strategy of offering good-for-you, fun-for-you, and better-for-you products is imbedded into our plans and we strive to win consumer satisfaction every day though our more than 1,000 associates.
What is the current status of the Omani manufacturing sector?
Although mineral wealth other than oil and gas, demographic factors, and our locational advantage in the Arabian Peninsula present a perfect case for an ever-growing manufacturing sector, real growth on the ground has not been as anticipated due to various factors. Competitive advantages offered by the special economic zones in the neighborhood at times pull potential investors away from Oman. However, new developments in the Port of Duqm and the adjacent special economic zone (SEZAD) are attracting significant foreign and domestic investments. It will be a while before we see their actual contribution to the larger economy. Overall, the macroeconomic indicators appear to be attractive and interesting, and the microeconomic indicators are reflecting the impact of short-term measures initiated to cover the widening budget deficit on account of downturn in international oil prices. The ninth Five-Year Plan, published in 2016, has identified manufacturing, tourism, transport and logistics, mining, and fisheries as the new growth engines of the Omani national economy, diversifying it away from the oil and gas sector. Recently, the government's commitment to diversifying the Omani economy has been more clearly pronounced through the new Tanfeedh program, i.e. the National Program for Enhancing Economic Diversification, which is meant to proactively link the different strategies of the targeted economic sectors of manufacturing, tourism, transport and logistics, mining, and fisheries.
What is the status of your research and development of new product lines?
One of the fallouts of the proposed excise tax on carbonated beverages is that it may reduce new investments in business expansion and enhance related capacities in the carbonated beverages sector. On the other hand, it may act as an incentive for companies to invest in the R&D of new product lines to expand non-CSD beverages and diversify into other products, as well as expand offerings of other food product ranges. Our partners (PepsiCo and others) are working hard to identify new products that address consumer needs at all ages.