UK: Nestle pulls Boosted Smoothies in credit crunch
A weakening UK economy has forced Nestle to pull its functional smoothie range, Boosted smoothies, only four months after launch in the country, it has said.
Nestle said that, from this month, it has discontinued Boosted smoothies, launched in conjunction with Boost juice bars, because of poor sales.
Speculation grew last week that the functional smoothie range, launched in April to help spearhead Nestle's new 'wellness' division in the UK, had struggled to gain supermarket listings.
Jon Walsh, Nestle UK's managing director of new business, said: "Boosted smoothies launched in Spring 2008 with the intention of adding incremental growth to an expanding smoothies category. The economic downturn has seen the category move into decline and consumers switching to cheaper options such as chilled juice and it has been difficult to establish functionality - our key point of difference - in the market."
Smoothies have been a major success story for the UK soft drinks sector in the last couple of years. Smoothie volume sales in the UK rose by 44% to 75m litres in 2007, according to the Britvic Soft Drinks Report, published in April.
Falling consumer confidence has intensified competition on the market, however.
UK chancellor Alistair Darling said in an interview last weekend that the UK faced its worst economic crisis for 60 years.
A separate report from the Paris-based OECD this week predicted the UK would succumb to a technical recession, or two quarters of gross domestic product (GDP) decline, this year.
Walsh said Nestle remained committed to launching more new products in 2009, and also intended to focus more resources on RTD coffee brand Nesfrappé, which debuted this spring.
The forced withdrawal is a disappointment for Nestle and Boost juice bars, which had hoped to challenge the dominant market position of Innocent in the UK.
Boost founder Janine Allis said: "Despite the discontinuation of the bottled juice range, the expansion of the Boost juice bars business in the UK is gaining strong momentum with eight stores now open, and a ninth store scheduled to open shortly in the new White City Westfield development (in West London)."
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