Mr Munene at work: “The demand is high.” Photo/FILE
The lucrative non-alcoholic drink market segment is expected to become more competitive as new ranges of drinks are introduced and aggressive marketing campaigns launched.
During the post-election violence Daniel Munene, who is eyeing this market, was forced to abandon farming barley in Narok and opted to concentrate on a business that he previously thought little of: the non-alcoholic beverage sector.
“Farming was a good venture,” he says of the venture that saw him contracted by East African Breweries to grow barley on contract on a 500 acre farm.
While the post-election violence threw him out of the fields in Narok he went back to a side-business that he had stumbled on while visiting Holland.
“I needed something with malt but non-alcoholic. When I ordered one can, an idea struck me that I should start selling the same in Kenya,” he says.
And that is how Bavaria non-alcoholic malt entered the Kenyan market for the first time.
Today, Mr Munene is happy that Bavaria is taking its share in the market.
“The demand is high. This is because Kenyans have discovered the qualities of this drink. One important quality is that it does not leave them with a bloated stomach.’’
It has about two per cent of the market share of the non-alcoholic beverage sector and retails at Sh70 for 330ml can.
Other non-alcoholic malt drinks in the market are Alvaro and Novida.
“I can say this drink has no competitors because it is a class of its own’’ says Mr Munene who also operates bars selling Bavaria products only.
Mr Munene says he targets people who want to socialise “but do not want to get drunk.”
The drink is popular with middle- and high-income class, sells fast in the exclusive clubs and in Mombasa where it is popular with consumers who do not take alcohol.
“It is actually in Mombasa where we record high sales,” says Mr Munene.
Bavaria products could in the long run eat into the market that is strongly held by both Coca-Cola and EABL.
The latter also sells the Alvaro fruit favoured drink.
But is Mr Munene, who was once contracted by EABL to grow barley afraid of that? “No,” he says.
Only challenge
“The only challenge we are facing is having our point of sale materials destroyed by competitors to hide the product visibility which slows down sales.”
With the beer market reaching saturation point and the revenues dwindling due to high taxation and more health awareness, brewers are diversifying into the non-alcoholic market which has a huge potential for growth.
Mr Munene says Kenyans want to enjoy a drink with a full taste of beer but without alcohol.
For people who want to venture into this business, he says there are various business opportunities.
“The future prospects are geared towards intensifying distribution network by providing container shops all over the country as selling points, “ he says.
Two giants
In 2008, EABL and Coca-Cola launched malt drinks Alvaro and Novida respectively, eyeing consumers keen on non-alcoholic drinks and seeking new flavours and tastes.
They were priced at Sh25.
The two giants have expanded the distribution of the drinks to Uganda, showing the level of competition that is slowly taking shape in the niche market.
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