Alcoholic Drinks in Kenya
Euromonitor International's Alcoholic Drinks in Kenya market report offers a comprehensive guide to the size and shape of the market at a national level. It provides the latest retail sales data, allowing you to identify the sectors driving growth. It identifies the leading companies, the leading brands and offers strategic analysis of key factors influencing the market - be they new product developments, packaging innovations, economic/lifestyle influences, distribution or pricing issues. Forecasts illustrate how the market is set to change.
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Tables: 82 | Publication date: Mar 2008
Why buy this report
- Get insight into trends in market performance
- Pinpoint growth sectors and identify factors driving change
- Identify market and brand leaders and understand the competitive environment
Product coverage
Beer; Cider/perry; RTDs/High-strength premixes; Spirits; Wine
Executive summary
Sustained Economic Growth Drives Sales
Alcoholic drinks witnessed another successful year in 2007, growing 9% in value terms and 4% in volume terms, continuing the positive trend since 2004. Beer saw the strongest increase in value sales, whilst wine saw the strongest volume increase. Positive development in the market strongly correlates with continuing economic development. Since the National Rainbow Coalition of Kenya took power in December 2002, the economy has experienced economic growth, with 6.1% growth in the 2006/2007 financial year, and the growth rate is expected to reach 10% before the end of 2008. This has been a result of increased savings which are then channelled into investments.
New Avenues for Beer
Beer sustained its growth by taking away share from illicit products, with Senator, a budget brand launched by Diageo, proving tremendously successful. Beer is easily the most popular alcoholic drink, accounting for an estimated 78% of the total volume of alcohol sold in Kenya in 2006. Beer in particular benefited from foreign investment, with more than US$800 million spent on expanding production capacity in beer between 2000 and 2006. Domestic premium beer is very popular and heavily advertised through mass media channels.
Kenya Breweries Ltd (KBL) Leads in Beer
Kenya Breweries Ltd the local subsidiary of East African Breweries leads beer in 2006 with a 96% share. The company has a presence in three East African countries, Tanzania, Uganda and Kenya, and also in Central Africa. The company has continued to increase its share through sponsorship and events. East African Breweries Ltd is East Africa's number one brewer and the market leader for alcoholic drinks distribution, distributing nearly 90% of all branded beer. The company's premier brands include Tusker, with its brand logo "Milele", the top selling lager in East Africa, and a product which has gained international acclaim thanks to a number of high profile awards.
Off-trade Still Dominates
Off-trade continues to lead as the main distribution channel for alcoholic drinks in volume terms; however, more expensive brands and higher margins generate higher value sales through on-trade for wine, RTDs and spirits. Off-trade distribution is still very fragmented, with independent food stores having the highest share in 2007. However, supermarkets/hypermarkets gained the biggest share during the review period, which benefited manufacturers in the distribution process.
Positive Outlook for Alcoholic Drinks
There is likely to be increased investment in the alcoholic drinks market as a result of continued growth in the Kenyan economy. 55% of the Kenyan population is between 15 and 64 years old. This provides a ready market for alcoholic drinks, as well as labour for the alcohol industry. The economy is expected to grow by 10% before the end of 2008. The fact that more Kenyans are being employed, both women and men, and more are investing in small businesses will increase disposable incomes and therefore boost growth in the alcoholic drinks market.
Alcohol the Main Source of Revenue for the Kenyan Government
The Kenyan government has always relied on taxes from alcohol to offset its annual budget. The key taxes levied on alcohol are excise and value added taxes. Alcohol contributes 25% of total excise revenue and 5% of total customs revenue collected by the Kenya Revenue Authority (KRA). The government has increased the price of alcohol in order to increase the revenue collected. Consequently, there is likely to be a shift from consumption of manufactured beer to consumption of traditional brews. It is estimated that 74% of Kenyans consume traditional brew, and only 24% manufactured alcohol, whilst 2% consume wines and spirits. The number of people consuming traditional brews, especially chang'aa, is likely to increase. Generally, despite this price increase, most alcohol drinkers in Kenya are bound to continue drinking alcohol.
Table of contents
ALCOHOLIC DRINKS IN KENYA : MARKET INSIGHT
EXECUTIVE SUMMARY
Sustained Economic Growth Drives Sales
New Avenues for Beer
Kenya Breweries Ltd (KBL) Leads in Beer
Off-trade Still Dominates
Positive Outlook for Alcoholic Drinks
Alcohol the Main Source of Revenue for the Kenyan Government
MARKET BACKGROUND
Legislation
Taxation and Duty Levies
Table 1 Taxation and Duty Levies on Alcoholic Drinks 2007
Table 2 Typical Wholesaler and Retailer Off-trade Mark-ups by Selected Sectors 2007
Table 3 Selling Margin of a Typical Beer Brand 2007 – Tusker
Table 4 Selling Margin of a Typical Imported Wine Brand 2007 – Caprice Red
Table 5 Selling Margin of a Typical Domestic Spirit Brand 2007 – Kibao Vodka
Table 6 Selling Margin of a Typical Imported Spirit Brand 2007 – Johnnie Walker Red Label
OPERATING ENVIRONMENT
MARKET DATA
Table 7 Sales of Alcoholic Drinks by Sector: Total Volume 2002-2007
Table 8 Sales of Alcoholic Drinks by Sector: Total Value 2002-2007
Table 9 Sales of Alcoholic Drinks by Sector: % Total Volume Growth 2002-2007
Table 10 Sales of Alcoholic Drinks by Sector: % Total Value Growth 2002-2007
Table 11 Sales of Alcoholic Drinks by Sector by On-trade vs Off-trade Split: Volume 2007
Table 12 Sales of Alcoholic Drinks by Sector by On-trade vs Off-trade Split: Value 2007
Table 13 Sales of Alcoholic Drinks by Sector by On-trade vs Off-trade Split: % Volume 2007
Table 14 Sales of Alcoholic Drinks by Sector by On-trade vs Off-trade Split: % Value 2007
Table 15 Company Shares of Alcoholic Drinks by Global Brand Owner 2003-2006
Table 16 Off-trade Sales of Alcoholic Drinks by Distribution Format: % Value Analysis 2007
Table 17 Off-trade Sales of Alcoholic Drinks by Sector and Distribution Format: % Volume Analysis 2007
Table 18 Forecast Sales of Alcoholic Drinks by Sector: Total Volume 2007-2012
Table 19 Forecast Sales of Alcoholic Drinks by Sector: Total Value 2007-2012
Table 20 Forecast Sales of Alcoholic Drinks by Sector: % Total Volume Growth 2007-2012
Table 21 Forecast Sales of Alcoholic Drinks by Sector: % Total Value Growth 2007-2012
DEFINITIONS
Summary 1 Research Sources
EAST AFRICAN BREWERIES LTD
Strategic Direction
Key Facts
Summary 2 East African Breweries Ltd: Key Facts
Company Background
Production
Competitive Positioning
WINES OF THE WORLD LIMITED
Strategic Direction
Key Facts
Summary 3 Wines of the World Limited: Key Facts
Company Background
Production
Competitive Positioning
BEER
Headlines
Trends
Production, Imports and Exports
Competitive Landscape
Prospects
Sector Background
Summary 4 Lager by Price Band 2007
Sector Data
Table 22 Sales of Beer by Subsector: Total Volume 2002-2007
Table 23 Sales of Beer by Subsector: Total Value 2002-2007
Table 24 Sales of Beer by Subsector: % Total Volume Growth 2002-2007
Table 25 Sales of Beer by Subsector: % Total Value Growth 2002-2007
Table 26 Sales of Beer by On-trade vs Off-trade Split: Volume 2002-2007
Table 27 Sales of Beer by On-trade vs Off-trade Split: Value 2002-2007
Table 28 Sales of Beer by On-trade vs Off-trade Split: % Volume Growth 2002-2007
Table 29 Sales of Beer by On-trade vs Off-trade Split: % Value Growth 2002-2007
Table 30 Company Shares of Beer by National Brand Owner 2002-2006
Table 31 Company Shares of Beer by Global Brand Owner 2002-2006
Table 32 Brand Shares of Beer 2003-2006
Table 33 Forecast Sales of Beer by Subsector: Total Volume 2007-2012
Table 34 Forecast Sales of Beer by Subsector: Total Value 2007-2012
Table 35 Forecast Sales of Beer by Subsector: % Total Volume Growth 2007-2012
Table 36 Forecast Sales of Beer by Subsector: % Total Value Growth 2007-2012
WINE
Headlines
Trends
Competitive Landscape
Prospects
Sector Data
Table 37 Sales of Wine by Subsector: Total Volume 2002-2007
Table 38 Sales of Wine by Subsector: Total Value 2002-2007
Table 39 Sales of Wine by Subsector: % Total Volume Growth 2002-2007
Table 40 Sales of Wine by Subsector: % Total Value Growth 2002-2007
Table 41 Sales of Wine by On-trade vs Off-trade Split: Volume 2002-2007
Table 42 Sales of Wine by On-trade vs Off-trade Split: Value 2002-2007
Table 43 Sales of Wine by On-trade vs Off-trade Split: % Volume Growth 2002-2007
Table 44 Sales of Wine by On-trade vs Off-trade Split: % Value Growth 2002-2007
Table 45 Forecast Sales of Wine by Subsector: Total Volume 2007-2012
Table 46 Forecast Sales of Wine by Subsector: Total Value 2007-2012
Table 47 Forecast Sales of Wine by Subsector: % Total Volume Growth 2007-2012
Table 48 Forecast Sales of Wine by Subsector: % Total Value Growth 2007-2012
SPIRITS
Headlines
Trends
Production, Imports and Exports
Competitive Landscape
Prospects
Sector Data
Table 49 Sales of Spirits by Subsector: Total Volume 2002-2007
Table 50 Sales of Spirits by Subsector: Total Value 2002-2007
Table 51 Sales of Spirits by Subsector: % Total Volume Growth 2002-2007
Table 52 Sales of Spirits by Subsector: % Total Value Growth 2002-2007
Table 53 Sales of Spirits by On-trade vs Off-trade Split: Volume 2002-2007
Table 54 Sales of Spirits by On-trade vs Off-trade Split: Value 2002-2007
Table 55 Sales of Spirits by On-trade vs Off-trade Split: % Volume Growth 2002-2007
Table 56 Sales of Spirits by On-trade vs Off-trade Split: % Value Growth 2002-2007
Table 57 Company Shares of Spirits by National Brand Owner 2002-2006
Table 58 Company Shares of Spirits by Global Brand Owner 2002-2006
Table 59 Brand Shares of Spirits 2003-2006
Table 60 Forecast Sales of Spirits by Subsector: Total Volume 2007-2012
Table 61 Forecast Sales of Spirits by Subsector: Total Value 2007-2012
Table 62 Forecast Sales of Spirits by Subsector: % Total Volume Growth 2007-2012
Table 63 Forecast Sales of Spirits by Subsector: % Total Value Growth 2007-2012
CIDER/PERRY
RTDS/HIGH-STRENGTH PREMIXES
Headlines
Trends
Production, Imports and Exports
Competitive Landscape
Prospects
Sector Data
Table 64 Sales of RTDS/High-strength Premixes by Subsector: Total Volume 2002-2007
Table 65 Sales of RTDS/High-strength Premixes by Subsector: Total Value 2002-2007
Table 66 Sales of RTDS/High-strength Premixes by Subsector: % Total Volume Growth 2002-2007
Table 67 Sales of RTDS/High-strength Premixes by Subsector: % Total Value Growth 2002-2007
Table 68 On-trade vs Off-trade Sales of RTDS/High-strength Premixes: Volume 2002-2007
Table 69 On-trade vs Off-trade Sales of RTDS/High-strength Premixes: Value 2002-2007
Table 70 On-trade vs Off-trade Sales of RTDS/High-strength Premixes: % Volume Growth 2002-2007
Table 71 On-trade vs Off-trade Sales of RTDS/High-strength Premixes: % Value Growth 2002-2007
Table 72 Company Shares of RTDS/High-strength Premixes by Global Brand Owner 2002-2006
Table 73 Company Shares of RTDS/High-strength Premixes by National Brand Owner 2002-2006
Table 74 Brand Shares of RTDS/High-strength Premixes 2003-2006
Table 75 Forecast Sales of RTDS/High-strength Premixes by Subsector: Total Volume 2007-2012
Table 76 Forecast Sales of RTDS/High-strength Premixes by Subsector: Total Value 2007-2012
Table 77 Forecast Sales of RTDS/High-strength Premixes by Subsector: % Total Volume Growth 2007-2012
Table 78 Forecast Sales of RTDS/High-strength Premixes by Subsector: % Total Value Growth 2007-2012