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News

Zimbabwe: Schweppes tomato business teetering

25/06/2019 - François-Xavier Branthôme
A difficult competition with imported Chinese products

The newly introduced tomato business of beverages maker Schweppes Zimbabwe Limited (SZL) is struggling to find its feet due to lack of competitiveness.

SZL commercial and public affairs director Mrs Unaiswi Nyikadzino said the company’s Farm Style tomato paste, which is produced by the Best Food processor at its Norton plant, is struggling on the market largely due to the influx of cheap imported products.
 
This year, the tomato business is a bit of a challenge. Obviously, the cost structures are still high in terms of imported fertilizers and chemicals for farming, so that ends up pushing prices up. You find that the export market competitiveness is a challenge but domestic business has been decent. [...] Obviously the levels of domestic business are also dependent on how the economy is doing. Ultimately, other manufacturers are also supplying the same consumers, who might be struggling with low disposable incomes. So at the end of the day, that presents a challenge,” she said.

Mrs Nyikadzino said that capacity issues at the Norton factory were delaying the company’s prospects of opening another plant at Esigodini in Matabeleland South Province. “We are not yet there. Obviously, we would like to increase our investment in terms of production capacity in the southern region, but for now, a lot of the capacity in the original plant in Norton we had been planning to be exporting… but our pricing competitiveness is still an issue. […] China is still far more competitive on growing and processing tomatoes. So because of the competitiveness of China, we still have excess capacity. […] So with excess capacity we will not be opening another facility until a time as a business we have utilized that capacity. Then we can open another facility.”

The company has two manufacturing plants in Harare and Bulawayo and nine distribution centres countrywide.

Source: nehandaradio.com
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