Beverage Industry in Uganda: Soft Drinks, Energy and Water Products by Crown Beverages

Interview with Paddy Muramiira, CEO of Crown Beverages Limited

What is your assessment of the soft drink sector in Uganda? What are the latest trends? Is the sector competitive? What do you bring to the market?

In Uganda, before the onset of PET, soft drinks were bottled in returnable glass. The two major players were Pepsi brands – by Lake Victoria Bottling Company and Coke brands by Century Bottling.

The introduction of PET liberalized the soft drink sector. Now, there are a number of players that come and go. It is easy entrance, easy exit. That has caused the sector to become more competitive than ever before despite the adverse effects of indisciplined PET disposal to the environment.

In the case of Crown Beverages, we are still playing in both glass and PET in the industry although the returnable glass contribution is progressively being eroded by PE category as a result of consumer preference to convenience.

On a global scene, we monitor the performance of Coca-cola and PepsiCo brands but do not have an insight in the rest of the players in the soft drink category, therefore the record I will give you is between ourselves and Coca-cola. We are currently in the lead in Uganda.

Nevertheless, we do not look at the soft drink manufacturers as the only competitors because competition is to whoever is competing for the share of pocket.

We are proud of the equity of our brands, which are well researched from the franchiser, and are accepted by the target groups. We contribute to the economy. We have been growing our numbers and our growth every year has been double digit. The total industry has moved from about 20 million cases 10 years ago to about 60 million cases now and there is still good potential for more growth.

Soft drink consumption per capita is low compared to other economies in the region such as Kenya or Ethiopia.

The drivers for our anticipated growth is a high rate of population growth, a young population, political stability and improved business environment.

If we grow the economy, which the government is focusing on, the disposable income shall improve positively then we shall see a significant growth in the beverage industry. Crown Beverages shall also be playing a part in that growth. One of the things that gives us hope is that there is a lot of input by the government in the agricultural sector. Agriculture is considered a priority, oil is becoming a reality now and focus is on the tourism industry.

How do you distinguish yourself from other companies in the market?

We produce high quality carbonated soft drinks, energy and water products. We are certified by AIB which is a quality monitoring organization hired by PepsiCo. We were recently certified for FSSC 22000 (Food Safety System Certification).

We have an advantage of being a locally owned company. Decision making is very fast. We utilize local talent who understand the dynamics of business in the country. That is very important for us. PepsiCo has been very supportive. They do not send one size fits all policies to us. They develop the local policies together with us to make the business grow faster. We have a very good marketing system for distribution and we present ourselves differently because of the talented labor that we attract and the participation of everybody tends to give a different focus compared to our competitors. When you get people that have commitment which is driven by participatory management, people tend to give their all rather than where you may get some people thinking that there is a different layer that is managing. We all talk together and run together with our local shareholders and that has grown the team to be one thread that is difficult to break.

We have good, quality brands that are also unique and preferred such as Mountain Dew and Mirinda Fruity.

What are some areas where you can improve? What new products or brands would you like to develop?

We are known for introducing a new brand every year. Our new product last year was Nivana Sparkling and Nivana Flavored. We will soon be launching Aquafina here, which is an international water brand of Pepsi. People are beginning to appreciate the zero and low calorie options. Although, that market has not been growing in Uganda where majority of consumers still prefer their high energy brands, we shall be slowly introducing the same. We know that with technology, internet, and communication, there is a lot of new information that cuts across from other markets. So, we will introduce low calorie brands soon.

Can you develop your own local brands?

We can on condition that they are not competing with the PepsiCo brand.

Are you looking for partnerships?

Currently, we are in the beverage sector and that is the area that we know best. We are not opposed to going into another sector with improved resources and a partnership as long as it will not affect the performance of the current business we have or directly compete.

What are your CSR activities?

Our participation in CSR has been majorly in the areas of health and sports through partnerships with other players. We have been partnering with Rotary International and we support them financially in the fight against cancer. We are very active with motocross through our Mountain Dew brand. We sponsor the Champions League and the local University Football League. We are very keen on growing talent using our Mirinda brand, we have been driving with teens. We develop their talents in music, fashion, etc. They can participate at the higher levels in terms of competing and boosting their esteem. We are keen on having girls shine. We participate in health and currently we are sponsoring a hospital in southwest Uganda, planning to buy them a CT scanner. We also partner with Reach A Hand Uganda for sexual and reproductive health and awareness.

What do you do on the environmental side?

As Crown Beverages and PepsiCo, we are very keen on environmental protection. In house, we recycle our waste and we treat our wastewater. In 2020, we want to go outside our premises and do awareness countrywide and participate with our packaging in terms of PET recycling programs for all the industries. We want to partner with all the other companies and do awareness so people will stop littering but instead, they can put PET bottles into bins, we pick them up, and we can recycle them. These bottles especially get into our water bodies. With PepsiCo, we look at waste management on our packaging materials. We have a program to help us continue light-weighting our packaging. We reduce packaging to reduce what goes back into the environment. Another point is to recycle and re-use and make different products from used PET such as tents or bins. There is still more work to be accomplished in this area.

What do you produce?

We produce high quality carbonated soft drinks, energy and water products. We are certified by AIB which is a quality monitoring organization hired by PepsiCo. We were recently certified for FSSC 22000 (Food Safety System Certification). We pride ourselves for performing well in the PepsiCo monitored unannounced audits for the three dimensions in plant, product, and trade quality assessments. We are confident that our product is of good quality and our systems are recognized internationally. We recently were awarded Bottler of the Year for Europe and SSA in the PepsiCo business units. We are proud that we can be recognized worldwide under the PepsiCo family. We also must thank the government for providing a conducive environment for companies to conduct business without hindrance. If the government did not partner with us, it would be very hard to run a successful business.

What is your vision for the company in two to three years’ time?

Our dream is to be the best beverage manufacturer and supplier serving consumers in East and Central Africa. We are looking at acquisitions and growing our business out of Uganda into DRC and South Sudan. We are growing our distribution in Rwanda. We also will move into nutrition and work with PepsiCo in the snacks industry. Many snacks are imported into the country.

What is your international reach?

We export to South Sudan and distribute in Rwanda. But we want to grow in those areas. We want to have industries in South Sudan, DRC, and Rwanda.

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