E-Malt.com News article: Tanzania: SABMiller increases supply of canned beer to regain a toehold in Tanzania

SABMiller has stepped up the supply of its canned brands in Tanzania as it seeks to regain a toehold in the country three months after officially ending a distribution agreement with East African Breweries, Business Daily reported on November, 17.

The London-listed firm has been distributing two brands sourced from Tanzania through its local subsidiary — Crown Beverages — which it acquired late last year after taking control of family-owned Crown Foods, the bottlers of Keringet drinking water.

Termination of the brewing and distribution arrangement for Redds and Castle Lager led to a severe shortage of the products with some outlets running out of stock.

“Our marketshare is in low —single digits — not significantly different from when EABL was distributing the product,” said Beth Longcroft, the business media relations manager at SABMiller.

The brewer has announced a promotion for the two products rewarding distributors and bar owners who buy in bulk. In the drive set to end later this month, purchases of more than 20 crates of Castle Lager and 25 crates of Redds are each rewarded with a free crate.

“We are trying to maintain the supply momentum that we have acquired now especially after the challenges faced a few months ago after the distribution agreement ended,” said Charles Gitau, the brand manager at Crown Beverages.

The East African market is increasingly becoming a battle zone between SABMiller and Diageo, majority owners of EABL as both firm’s race to grow their regional footprint.

SAB Kenyan subsidiary Castle Brewing shut down in 2002, forcing them to enter an uneasy distribution agreement with EABL after the SABMiller predecessor bought 20 per cent stake in EABL in a share swap.

SABMiller’s re-entry into the local market after a nine-year absence is expected to spark off intensified rivalry with leading manufacturer EABL.

“Given the termination of the brewing and distribution agreement with SABMiller, we expect that they will become a fourth key competitor in Kenya,” said EABL corporate affairs director Brenda Mbathi.


18 November, 2011