Coca-Cola has confirmed that its will boost its operations in Nigeria with about USD600 million to boost sales. This is in a bid to increase its offering in the African region.
The beverage maker said it plans to offer more drinks to include flavored and condensed milk, iced tea and bottled water to meet demand in Africa’s most populous country, Peter Njonjo, the president of the West Africa operation, said in an interview with Bloomberg. “Our objective is to provide whatever beverages you need across your life stages,” he said.
Meanwhile, Global Chief Executive Officer James Quincey has said the company needs to grow beyond its biggest brand and has called for the soda giant to become a “total beverage company,” being less reliant on carbonated soft drinks.
Recalled that Coca-Cola bought a 40 percent stake in Nigerian juice and dairy company Chi Ltd. for USD240 million with hopes of taking total control within three years.
The company which has around 3,600 direct employees, 11 bottling plants and 30 distribution depots across Nigeria has also been affected by the economic challenges the country is facing with a decline in output and oil price including shortage of foreign exchange.
This is “a big issue,” for Coca-Cola, present in Nigeria since 1951, Njonjo said. “As disposable incomes start getting under pressure, expenditure in products like ours start becoming inaccessible to most consumers,” he said.
In response to the challenges in Nigeria, Coca-Cola increased prices, introduced new product-sizes and sought more inputs locally. To reduce its foreign-exchange exposure, the company plans to raise to 75 percent the share of raw materials produced in Nigeria by 2020, from 70 percent currently, Njonjo said.
“The only way that you can ensure that the business is sustainable is by taking prices up. Some of it we have passed to the consumers,” he said. The soda maker has also increased investment in distribution and innovation, the regional head said. “It is all about looking at how much money consumers have and how do I become relevant to consumers,” Njonjo said.