Kenyan based brewer Keroche cashes in on growing appetite for high alcohol content drinks with launch of X Beer

KENYA – Keroche Breweries Limited, an alcoholic beverage manufacturer in Kenya has yet again introduced another strong beer in the market under the brand name X Beer.

The new drink targets the high-end market as it is sugar-free and has an alcohol by volume content of 8.8%.

The launch by Kenya’s second largest brewer comes a few months after its unveiling of the Vienna Ice Strong Lager with an alcohol strength of 10% in April.

Keroche notes that the launch of the two products is in a bid to meet the local demand for strong beer which has over the years been met by foreign booze imported into the country, reports Business Daily.

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The move will also enable the beer maker to grow its market share in the country to 20%, generate more money to the exchequer annually, while creating more job opportunities.

It will further stimulate economic viability of the local producers of sorghum and barley in the country, as the company has vowed to buy the beer producing materials from the local market.

“The quality of brand X and its richness is unmatched in the present market. It is targeted at the middle and upper-end market.

“For years we have relied on imported strong beer. Being local manufacturers, we have chosen to fill this gap and give Kenyans a beer of great taste that makes for an easy enjoyable drinking experience,” Keroche CEO Tabitha Karanja said.

The Naivasha-based company is cashing in on the niche market present in the beer loving country, which has recently been witnessing a shift towards high alcohol content drinks.

“The quality of brand X and its richness is unmatched in the present market. It is targeted at the middle and upper-end market.”

Keroche CEO – Tabitha Karanja

According to Statista, beer accounted for roughly 40 percent of the alcohol consumption in Kenya as of 2016, followed by spirits with a share of 21.4 percent.

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However according to Kenya’s dominant alcohol industry player, Kenya Breweries Limited (KBL), consumers have built an appetite for the spirits category, as evidenced by its half year period financial results ended December 2020.

The report revealed that the company’s spirits net sales grew by 10 percent, partially offset by beer sales which declined by 8 percent.

To this end, the subsidiary of the East African Breweries Limited is set to inject Ksh1 billion (US$9.2m) in the establishment of a new spirit processing line, in a bid to meet the high demand.

The rational behind the rise in demand according to the company is that, the millennials who are increasing the number of people entering the legal drinking age, opt to debut with strong alcohol drinks like spirits.

Big brewers on spot for possible market distortion in COMESA region

Meanwhile, some of the world’s biggest alcoholic beverage manufacturers selling their products in Kenya and the region are being investigated for practices that are deemed to hamper cross border trade and competition in the alcoholic beverages industry.

According to reports by The Standard, the companies are alleged to have put in place structures that focus on marketing their products within a country, which according to the COMESA competition watchdog, confine dealers and other partners to a particular country – hindering the deepening of trade within Comesa.

Some companies are said to have arrangements among themselves that make them appear like they are colluding. The companies being probed include Diageo, AB InBev, Castle and Heineken.

“Notice is hereby given to interested stakeholders and the general public that pursuant to Article 22 of the Comesa Competition Regulations, the Comesa Competition Commission has commenced investigations into potential violations of Articles 16 and 19 of the regulations by beer manufacturing companies operating in the Common Market, namely AB InBev, Castel, Diageo and Heineken,” said the Competition Commission.

To this end the Commission will assess the agreements and existing arrangements to determine their effect in the Common Market and apply appropriate measures as per the regulations.

It noted that while it has started an investigation, this does not necessarily mean that the companies have presupposed that the conduct being investigated “is anti-competitive nor that any of the mentioned beer manufacturing companies have violated the regulations.

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