Sechaba Feels Pinch Of Beer Regulations

Isaac Pinielo | Monday November 23, 2015 11:14

 

In the group’s results for the half-year period ending September 30, 2015, the brewer stated that total volumes for the period ended 0.74 percent below the year before.

Clear beer, alcoholic fruit beverages and sparkling soft drinks showed promising growth, while the ongoing water and power shortages affected the performance of the non-alcoholic beverages category, but more especially the traditional beer category.

As a result, traditional beer volumes declined by 18.8 percent against prior year partly to the continuing impact of the traditional beer regulations.

The levy on alcoholic beverages was increased by five percent December last year from 50 percent to 55 percent resulting in the group increasing prices of alcoholic products.

Managing director of Sechaba Brewery, Johan de Kok said the challenges faced by the associate as a result of the traditional beer regulations have continued, adding that the company continues to find the appropriate routes to market within the regulations.

The alcoholic beverages industry has been under pressure since the introduction of the alcohol levy in 2008.

In 2012, government introduced new traditional beer regulations, which resulted in the closure of informal Chibuku outlets. Sechaba said that the strategy to invest in beer gardens seems to be losing momentum due to the unavailability of land.

The effects of the regulation saw the company closing its opaque beer factory in Palapye due to changes in the business environment, mainly the pressures on sales of alcoholic beverages induced by the levy. We want to maintain strategic partnerships we have and attract new partners from the mining sector in order to train more people to work in the industry.” She also urged local companies in non-mining sectors to partner with government to train their existing and new workers. “If companies in other sectors partner with the government to train workers for themselves, then they will improve their competitiveness, which will benefit the country,” she said.  In 2013 the government, BCM and GIZ entered into an agreement to support courses that would help bridge the skills shortage in the mining sector. For years, companies in the mining sector have bemoaned shortage of skills in the country. This has resulted in the mining companies being forced to hire expatriates...