Food & Beverage Market
Africa is a nation that has relied on agriculture as the backbone of its economy. Currently, the majority of the population uses its purchasing power on fresh goods. African countries are placing more emphasis now than ever on public health education, so health is a growing concern for its consumers. Products with a more natural, organic, and fresh ingredient list are most likely to succeed in this market. Any product with nutritional benefits may also appeal more to this group of consumers.
Unique distinctions in the African population should be noticed when exporting, especially if you are unfamiliar with exporting to developing nations. More than half of the population is under 25 years old, so any US products and campaigns could be targeted to these demographics to optimize sales. An increase in public health awareness stimulates demand for immune-building food and beverages that would help improve the population’s ability to fight off infections.
As societies change from an emphasis on rural life to an increasing growth of urban areas, diets are changing and healthcare access is increasing. Urbanization and purchasing power continues to influence the African economy and society. Cultural standards are beginning to shift. In a region where nearly 40% of food perishes before reaching consumers, maintaining nutritional value and integrity of food and beverage products is an important public health issue.
In an effort to decrease the quantity of wasted food and increase the health and safety of consumers in Africa, a collaboration on temperature-controlled storage by the Global Cold Chain Alliance (GCCA) has focused its efforts on the African food and agriculture markets. Cold chain is the temperature management of perishables, maintaining quality and safety from the point of slaughter or harvest to the final consumer. According to the GCCA assessment, the alliance represents the warehousing, construction, and transport industries engaged in temperature-controlled logistics. It serves over 75 countries (1,300+ companies). Currently 40% of the nations served by the GCCA are outside of North America. The partners in this alliance include industrial and nonprofit representation, including: the International Association of Refrigerated Warehouses (IARW), the International Association for Cold Storage (IACS), the International Refrigerated Transport Association (IRTA), and the World Food Logistics Organization (WFLO). This effort encourages engagement between the International Trade Administration and African Governments, including the continent’s economic leader, Kenya.
In February of 2015, the U.S. Department of Commerce agreed to launch the cold chain assessment in East Africa to evaluate market potential and value of implementing and improving African cold chains, creating a number of suggestions for African governments to successfully implement plans. Some of these recommendations include increasing public awareness, implementations of technology, and a stricter adherence to import/export regulations compliance. The assessment determined Kenya to be a high-potential investment for trade, based on current market size. Currently, Kenya’s economy has a stronger connection to continental and global economies than the rest of Africa when it comes to flow and trade. Further increasing Kenya’s potential—and Africa’s by default—is an infrastructural development plan that seeks to dramatically improve the nation’s economy by meeting consumer demands, which have been expanding from agricultural markets as a result of the nation’s growing middle class and increase in disposable incomes.
East Africa, especially, has seen drastic growth in recent years. Kenya’s business strategies serve as a trail blazer for the rest of the continent. Its innovations include incorporation of mobile-based money, where they currently sustain their global leadership. It also remains competitive in global markets with a growing, diversified private sector. Kenya’s growth can be seen by international markets as a marker to predict the following of other African countries into similar economic growth. Exporting to African markets for many Food and Beverage companies might appear to be a risk, but investments of this nature stand to be an opportunity to introduce current products, or even goods that are not marketable in the US, to a virtually untapped foreign market.
