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Africa’s top performing consumer product companies

We have recently published the inaugural African Powers of Consumer Products 2016 research report that identifies the Top 50 listed, Africa “born and bred” consumer product (CP) companies by revenue, looks at their profitability and explores recent sector developments and trends. All of this is in an effort to paint a clearer picture of the opportunities presented by this industry and to enable consumer products industry businesses to play their best game in this space.

Expect to find key statistics about the Top 50, Top 10 by revenues, Top 10 fastest growing and Top 10 by profitability.
Product sector analysis

Food, beverage and tobacco is the most prominent sector, accounting for approximately 94% of companies in the Top50. 32 of these can be classified as food companies, 14 beverage companies, and 1 tobacco company. The remaining 6% consists of representatives from the home furnishing sector – 1 company (Oriental Weavers from Egypt) – and 2 Personal Care & Household product companies (Lesieur Cristal from Morocco, and Société d’Articles Hygiéniques from Tunisia).

  • 32 – Food
  • 14 – Beverage
  • 2 – Personal Care and Household products
  • 1 – Tobacco
  • 1 – Home Furnishing
Top 10 by profitability (FY11-FY15)
Rank (Profit margin) Company Country of Origin FY15 Revenues (USD m) Revenue CAGR: 2011-2015 FY15 Profit margin (%)
USD Reporting currency
1 Eastern Tobacco Co Egypt 820.8 6.60% 12.90% 21.20%
2 Tanzania Breweries Ltd Tanzania 519.6 1.00% 8.60% 20.60%
3 Societe Frigorifique Et Brasserie De Tunis (SFBT) Tunisia 441.9 -0.70% 7.90% 17.20%
4 Edita Food Industries S.A.E. Egypt 288.8 10.90% 18.30% 15.50%
5 Delta Corporation Ltd Zimbabwe 538.2 -0.80% -0.80% 14.90%
6 Cervejas de Moçambique Mozambique 317.8 6.60% 12.30% 14.50%
7 Société de Limonaderies et Brasseries d’Afrique Cote d’Ivoire 265.5 2.40% 8.00% 14.40%
8 East African Breweries Ltd Kenya 712.7 6.90% 9.40% 13.90%
9 Cairo Poultry Egypt 294.0 -1.90% 4.70% 13.20%
10 Nigerian Breweries Nigeria 1485.7 0.10% 6.30% 12.90%

The strong representation of carbonated beverages and beer as well as tobacco products indicates the generally high margins of non-essential or luxury goods whose consumers seem to be less price sensitive. Essential or basic food producers such as flour mills, bakeries and pasta producers reported the lowest recorded profit margins in the Top 50 in FY15.

Developing themes

  • Local manufacturing support and backward integration

Protectionist measures are emerging along with localised manufacturing capabilities providing local companies (or companies with local production operations) with an opportunity to take market share from imported brands and products, especially in the food and personal care categories

  • Private labels

These are becoming a possible source of growth for CP companies during challenging times. With the rise of private labels, retailers are not only able to increase local sourcing and by doing so reduce their exposure to exchange rate fluctuations, but are also able to improve their margins

  • The evolving value equation

Company and consumer dynamics are set to evolve as the African consumer becomes more conscious of a changing value relationship with the brands they consume.

  • Innovative solutions

The relatively low quality of transport infrastructure and logistics services remain a challenge for the continent however, companies are coming up with innovative solutions to Africa’s logistics challenges

Overall, we foresee good growth prospects for the future

We acknowledge that the African growth story has stuttered recently, however, the prospects and opportunities are still positive, especially for consumer product companies. Positive economic prospects linked to accelerating urbanisation, a growing middle class and Africa’s young population, along with improvements in infrastructure and technological developments, have attracted the interest of a range of multinational companies such as Dangote Sugar Refinery, Flour Mills of Nigeria, Distell Group, Pioneer Food Group and Tiger Brands

For both African and international companies looking to invest in Africa, growth opportunities on the continent clearly exist. There are local players making significant inroads, who know the markets, understand the nuances and speak the local languages. A combination of local knowledge and international expertise will be a successful formula for ongoing growth for African Consumer Products producers.

For more details and insights on this topic, and other findings, download our African Powers of Consumer Products report.

You can also contact us to further discuss business in Africa – we have presence in over 50 African countries, and can leverage our extensive networks across the continent and the world, to better understanding the different market nuances and success factors that will catapult your business to the next level.

André Dennis
Africa Consumer & Industrial Products Leader
adennis@deloitte.co.za
+27 11 806 5184

Dylan Piatti
Africa Consumer & Industrial Products Chief of Staff
dpiatti@deloitte.co.za
+27 82 267 6279

About the author

Deloitte South Africa

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