By 2017, Zambia is predicted to drive Nampak’s African growth strategy by generating at least 25 per cent of its revenue from the rest of Africa. Angola, Kenya and Nigeria are among the main priority areas, but Nampak chief executive officer, Andrew Marshall, believes that Zambia is key to a number of strategic opportunities.
The packaging company plans to build on the success of its ‘mini Nampak’ model in Zambia, which includes a wide range of packaging goods and services from the business’s diverse portfolio, such as metal cans, drums and crowns, folding cartons, paper labels and self-opening bags, as well as PET jars, HDPE bottles, crates, caps and closures. Presently, Nampak has two manufacturing sites in Zambia, in Lusaka and Ndola.
Nampak is also gearing up to export liquid cartons for opaque beer, which are manufactured in Zambia, to other countries in the region. The company has an impressive track record in the category, having helped grow opaque beer sales in the country since 2000. But, the company’s history in the country dates back to the mid-1990s, when two filling machines were installed. At that time, the cartons were manufactured in South Africa and exported to Zambia. However, duties and transport logistics added costs, and sales were approximately 16 million units per year. Volumes remained flat due to price.
In 2000, Nampak Zambia acquired a flexographic printer and flame sealer, which increased sales to 60 million units within the first year. Nine years later, sales reached 180 million units and a second printer and flame-sealer were installed. Today, Nampak Zambia has capacity to manufacture 380 million units per year and has more than 30 filling machines locally. The company also services the filling machines and supplies spares.
Nampak’s presence in Zambia is a major drawcard for the local SABMiller opaque beer operation, National Breweries Limited (NBL) and their success has prompted the beverage company to develop opaque beer businesses in more than 10 African countries over the next three years. NBL believes that the informal beer market is about four times the size of the clear beer market, and has a place among a specific consumer segment.
Business development director Derek Perryman says that ‘Nampak is making significant progress, despite certain current constraints regarding access to the latest technology and skills. We are leveraging the available resources and developing local people, so they are empowered to make world-class packaging for Africa, now and in the future.’
Adds Marshall, ‘The success of Nampak Zambia, as well as our experience in opaque beer, is a key driver of our strategy. Similarly, we have a long history with SABMiller and we are looking forward to growing with them, not only in opaque beer, but with other packaging mediums, as they grow their offering in Africa.’
The Zambian economy is expected to grow by 6.9 per cent in 2012, picking up to 7.3 per cent in 2013. Presently, Nampak has a footprint in 13 African countries, including South Africa, as well as Angola, Botswana, Ethiopia, Kenya, Malawi, Mozambique, Namibia, Nigeria, Swaziland, Tanzania, Zambia and Zimbabwe. The rest of Africa accounts for 20 per cent of group revenue. The company is well known for partnering multinationals in Africa, such as the carton manufacturing plant in Nigeria and a beverage can-making facility in Angola.