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The table top retail channel still the most popular

27-03-2015 Hits:52 My Article Editorial Team - avatar Editorial Team

The table top retail channel still the most popular

While major regional and multinational retailers are making well-publicised forays into African consumer markets, the most common shopping channel on the continent remains the 'table top', the emerging-market equivalent of the convenience store. According to a Nielsen report – entitled 'Africa: How to Navigate the Retail Distribution Labyrinth' – research in 14 sub-Saharan countries found that 80% of consumers shopped...

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Beauty booms on the continent

26-03-2015 Hits:141 My Article Editorial Team - avatar Editorial Team

Beauty booms on the continent

Africa's beauty market is one to watch, thanks to a forecast compound annual growth rate of more than 8% through until 2019."Demand for high-quality products at reasonable prices is one of the key trends emerging in this market," note the authors of the 'Beauty and Personal Care Market in Africa Report: 2015 to 2019', published by global insights firm Research...

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Can 'day of joy' campaign help to revive McDonald's sales?

25-03-2015 Hits:216 My Article Editorial Team - avatar Editorial Team

Can 'day of joy' campaign help to revive McDonald's sales?

In the wake of its worst sales performance in more than a decade, global fast food giant McDonald's yesterday rolled out an international 'day of joy' campaign. Aimed at celebrating 24 moments of joy in 24 hours with consumers in 24 cities around the globe, the promotion involved the staging of fun events in various locations, as well as popular...

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Africa's super-rich set to increase

24-03-2015 Hits:301 My Article Editorial Team - avatar Editorial Team

Africa's super-rich set to increase

While South Africa remains the country on the continent with the highest number of super-wealthy individuals, other African countries – most notably Nigeria and Ivory Coast – are producing increasing numbers of businesspeople and entrepreneurs with a net worth of at least US$30-million. This is according to the 2015 edition of The Wealth Report, which was launched last week in Johannesburg...

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Reputation's role in unlocking brand value

23-03-2015 Hits:396 My Article Editorial Team - avatar Editorial Team

Reputation's role in unlocking brand value

In addition to having extensive product choice, consumers today have almost as many options when it comes to the companies they choose to buy from. And while factors like price, availability and selection are often big drivers along the path to purchase, the importance of a company's reputation is vital. Indeed, says a study by international research house Nielsen, reputation is...

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Is there an opportunity, both within the continent and further afield, to grow the market for Africa’s red meat products?

While McKinsey’s focus was on cultivation and farming, a recent article carried on the GlobalMeatNews website, a resource for decision-makers in the global meat industry, raised the question of Africa’s potential as a source of meat products that could meet growing international consumer demand.

In the article Elizabeth Bonsall, a consultant with agri food supply chain consultancy Promar International, wrote: “Traditionally, Africa accounts for just 5% of the world’s beef, sheep, chicken, pork and goat meat production – equivalent to some 14-million tons. The largest producer in Africa is, by some margin, South Africa at 20% of the total, followed by Egypt at around 10%.”

Internationally, noted Bonsall, Africa has a fairly low level of domestic meat production, so exports are minimal at around 125 000 tons a year. “In contrast, the growth of Africa’s meat imports has been significant – increasing by some 300% over the last 10 years, rising to around 1,8-million tons.”

Driving this growth in meat consumption is the well-documented rise of the African middle class; a population which has the disposable income and the taste for costlier, high-end food products like meat.

In a 2013 article in South Africa’s Mail & Guardian newspaper, this consumer trend was highlighted and drew parallels between the rise in average incomes and the rate of meat consumption. According to the paper: “In 1992, the average person ate a total of 15,8kg of white meat a year, according to the Department of Agriculture, Forestry and Fisheries. The nominal GDP per capita was US$3,39 at the time. Twelve years later (2004), the average South African ate 23,3kg of white meat a year — an increase of 48%. According to the International Monetary Fund, the GDP per capita in that year had risen to US$4,47.”

The article further noted that by 2012, “the consumption of white meat had increased by another 54% to 35,8kg a person a year. In the same year, the nominal GDP per capita had risen to US$7,51.”

On a global scale, the Food and Agriculture Organisation of the United Nations conducted a study three years ago entitled ‘World Livestock 2011’, in which it projected that, by 2050, meat consumption would increase by some 73% and dairy consumption by 58%.

As this global – and African – demand rises, so does the potential for the meat production industry on the continent to feed not only a meat-hungry domestic market, but also international consumers. As Bonsall noted: “With demand for food [likely] to increase as the world’s population becomes richer and more focused on Western diets, access to farm land and increasing [the] productivity of existing farm land is very much on the agenda. Organisations such as the World Bank now suggest that Africa may hold the key to balancing future global food demand with actual production.”

This bullish view was echoed by Kurt Davis Jr – a private equity investor and early business consultant with experience in Africa, Asia, Europe and the USA – in a blog entitled ‘The Cash Cow of Africa’ that was carried on the Africa.com news and views website. Focusing on both the meat and dairy industries, Davis noted: “The story of the cash cow in Africa overall is less one of major growth when compared to chicken and eggs; rather, it is one of more efficiency and value chain alignment in the face of low productivity, high demand and differing, but high, prices in certain countries. The potential for fatter and healthier beef through better management of farms, particularly on the feeding side, along with a growing demand, is the second part of the boom. Throw in manure as an added windfall and the potential for a commercial dairy and beef investment goes through the roof.”

The announcement in February this year that the international ban on South African red meat exports had been lifted holds hope for the longevity and future growth of this industry in Africa. The ban, which had been in place since 2011 after the outbreak of foot and mouth disease in the country, cost the national economy some R3-billion (US$28-million) in revenue.

Quoting Tina Joemat-Pettersson, who was South African Agriculture Minister at the time, Eyewitness News said bio-security controls had since been put in place, including deploying mobile veterinary clinics to high risk areas within the country and to the country’s borders.

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