, NAIROBI, Kenya, Jan 29 – If you have flirted with the idea of starting an alcoholic beverage company and turn it into a success, you probably should take the advice of Charles Ireland, the Group Managing Director of East Africa Breweries Limited (EABL), for two reasons:
First, his company sells the most popular alcohol brands in the region. These include legendary beers such as Tusker, Guinness and Pilsner, and new comers such as Senator and Tusker Lite which seem to be giving older brands a run for their money.
Second, the business model that EABL uses is yielding profits. Just late Thursday, the company announced a total of Sh5.5 billion in profits during its 2016 half year results.
“First of all, you need a great team working with you. The team also needs to be very talented. You therefore need to scout for talent in all areas of your business. This will enable you build a brand because you cannot build a brand on your own,” Ireland, tall with a detectable British accent says.
This leads him to explore the issue of building and maintain a strong brand, such as that of EABL. According to Ireland, a strong brand needs a lot of financial investment. Money, he says, is one of the ingredients of having a strong brand.
Ireland also says that to create a strong brand that is at the same time unique, you need to have love and passion for your product which he says will propel the product forward into even the most stubborn markets.
“You also need to put in a lot of time. None of our brands is what they are without the time factor,” he says.
But most importantly, Ireland says that the customers should be at the core of your product. He says that whatever product you choose to put into the market, it has to have relevance among your customers and meet their desires.
True to his words, EABL has registered an 8 percent increase in its net sales and a double digit growth in five out of eight product segments. Such growth has been witnessed in Senator Keg and Tusker Lite among other brands.
What you need to know before you diversify
Ireland can also teach you on matters diversification. Although Kenya is EABL’s biggest market in the region, by three quarters, the company has a footprint in other East African countries such as Tanzania, Uganda and South Sudan. It also accounts for between forty five to fifty percent in market share in the region.
“One of the things I’ve learnt about taking a business into a new territory is that you need to understand cultural sensitivity and comprehend the specific dynamics for the place you want to launch your business into. These may seem superficially similar but under closer inspection, they are not. For instance, you may assume that Tanzania and Kenya are similar but they are not. What it takes to make it in Tanzania is not necessarily the same thing that will make you find success in Kenya,” he explained.
Ireland also advices that you need to understand that stability is not as guaranteed as it once was.
In EABL’s case, when they took their business to South Sudan, the country had just been formed and it was beaming with hope. Investors were looking at it as the next big place to invest in, until political issues that led to turmoil rocked the country which has in turn posed a great challenge to their business operations there.
In his words, Ireland confesses that EABL had plans to build a manufacturing hub in South Sudan which could have cost billions of shillings, but they did not.
“I am really happy that we did not because we would have spent up to US$200million into it and we would now be regretting doing so,” he says.
Hence he advises companies to trend lightly before putting a lot of money into new territories.
In his shoes, Ireland says that his personal goals are fine tuned with those of the company which include innovating at scale to meet new consumer needs, drive out costs to constantly invest in growth and win in reserve in every market among others.
“I’m very pleased that EABL has been recognized as the continent’s second best employer. I hope this continues to be so and that we can do much better and show our team work to the world,” he says in conclusion.