Since June, The Johannesburg-based company has been the home base to support all countries in Southern Africa, including Namibia, Botswana, Zimbabwe, Zambia, Malawi, Tanzania, Mozambique, Lesotho and Swaziland. Today, Sidel has a large installed base of more than 400 pieces of equipment in Southern Africa. This is a growing market in all types of beverage businesses, where Sidel is mainly involved in CSD, beer, and converters. According to Euromonitor, 3.5 billion liters of beer and 4 billion liters of CSD were consumed in South Africa in 2009. And even more importantly, forecasts for 2010 to 2014 are positive: the compound annual growth rate (CAGR) for beer is forecasted to be 5.4 percent, while for carbonated beverages it is expected to be 1.6 percent.
It was a shrewd move by SABMiller to buy Ethiopia’s water business Ambo from the Ethiopian government in 2008. Although SABMiller insisted on and got the majority stake (68%) in Ambo, the brewer also showed to its partner – the government – that it was not unwilling to share the ownership.
Al Ahram’s wine unit produces about 8 million bottles of wines each year and brings in about a fifth of Al Ahram’s more than 2 billion Egyptian pounds of revenue a year (EUR 260 million), reports claim. Most of the rest is coming from its 1.1 million hl beer business with brands such as Heineken, Stella, Sakara and Meister.
The good news first. In Southern Sudan, an oil-rich break-away republic of 8.5 million people, which still happens to be one of Africa’s conflict hot spots, SABMiller opened a brewery in May 2009 with 180,000 hl of capacity. By the end of 2010, brewery operations will have increased to 350,000 hl.
As we reported, the battle for Serengeti began to heat up last year when SABMiller succeeded in scuppering Diageo’s courting of Serengeti after securing a London court injunction. Eventually, SABMiller and Diageo settled out of court. But the settlement suggests that the 2002 share exchange between the companies, which translated into a “if you leave my market alone, I will not attack yours”, is becoming increasingly redundant. This is certainly better for Diageo than SABMiller. In the past, SABMiller tried to make headway in Kenya but failed.
It is apparent that Africa has “Endless Possibilities” and the thirst is not just for the product but also knowledge, skills and expertise. Therefore opportunities are available not only for the brewers and distillers but also suppliers and academia.
South African regulations prevent a brewer such as SAB from retailing beer and from supplying unlicensed outlets. Still, shebeens – unlicensed taverns – represent a significant part of the market, as sales through the estimated 120,000 of them account for 40 percent of all beer consumed in South Africa.
As the theme of last year’s successful convention “Sustainable Development” generated so much interested, it will be taken up again in 2011 for an assessment of recent developments and achievements.
The only official beer for the World Cup 2010 is Anheuser Busch’s Budweiser. Other brewers are not allowed to advertise within the stadium. The FIFA is known to fiercely protect its marketing interests and react rigorously when someone threatens them.
SABMiller is reportedly investing in fan zones near World Cup stadiums, revamping existing bars in townships and conducting other promotions behind its Castle brand to help hold on to its near 90 percent share of the South African beer market.