Bakhresa Group takes aim at a bigger piece of Africa
Sep 4, 2021
Not so many businesses can boast of having brands that are household names, resonating with consumers of all ages and different social walks of life. Deemed as one of Africa’s success stories, Bakhresa Group, a diversified industrial conglomerate headquartered in Tanzania, is one such company
Not many businesses can boast of having brands that are household names, resonating with consumers of all ages and different social walks of life. Deemed as one of Africa’s success stories, Bakhresa Group, a diversified industrial conglomerate headquartered in Tanzania, is one such company.
A stroll through the bustling markets of Dar es Salaam feels like walking through an Azam corporate display case, the leading brand of Bakhresa Group. Young men pedal tricycles mounted with Azam-branded refrigerators, from which they sell Azam ice cream. Shop fronts display the wide range of Azam products: milk, flour, rice, bread, snacks, water and other soft drinks, while Bakhresa trucks transverse between depots and retail outlets transporting finished goods to the market.
This was not always the case for the current multimillion-dollar business empire that was established by the well-known industrialist, Said Salim Bakhresa. Beginning in the mid-seventies as a small family-run restaurant in the port of Dar es Salaam, today it is a large entity, which has expanded its operations both vertically and geographically.
Bakhresa Group’s activities now cover the food and beverage sector, packaging, logistics, marine passenger services, petroleum, and entertainment. The company has further spread its wings beyond Tanzania and is now doing business in Uganda, Rwanda, Burundi, Malawi, Mozambique, Zimbabwe and South Africa. The company also undertakes export of its goods across sub-Saharan African countries and overseas.
Food industry behemoth
The genesis of the company’s food and beverage operations began in 1983 with the formation of Said Salim Bakhresa & Co Ltd (SSB), the flag-ship company of the Group.
The founder of the company leveraged on the privatization program from the Presidential Parastatal Sector Reform Commission of Tanzania to acquire wheat, rice and maize mills, which enabled him to build his empire in no time. According to the company, as per 2015, SSB had combined wheat milling capacity of 2,500 tons per day and storage capacity of 160,000 tons which was further expanded to 220,000 tons.
Meanwhile in the Tanzanian archipelago of Zanzibar, the flour miller runs the Zanzibar Milling Corporation Limited with a total milling capacity of 170 tons of wheat per day. In 2020, the company revealed plans of expanding its total wheat milling capacity to 3,500 tons per day. It also has a maize mill of 100 tons per day and a rice mill of 50 tons per day capacity. Products from all its mills include wheat flours, wheat bran pallets, semolina, maize flour, maize bran and rice.
Situated in the hot and humid environs of the port city of Dar es Salaam, Bakhresa formed another subsidiary, Bakhresa Food Products Ltd (BFPL), to quench the thirst of the millions of Tanzanians and citizens of its neighbouring countries. Providing the vital lifeline, the company produced its first water brand in 1998 that is currently sold under the ‘Uhai’ and ‘Safina’ brand names.
The investment in bottled drinking water paved way for the manufacturer to pump money into the establishment of the Azam Fruit Juice Processing Division. The state-of-the-art plant has the capacity to process 350 tonnes of fruits and vegetables daily and stores the pulp/juices/concentrates in 210 litres aseptic bags. The factory also features the first indigenous aseptic packing facility for fruit juices in the country with the capacity of packing 100 million litres per annum. The product range includes apple, black currant, mango, orange, pineapple, guava, and tropical mix fruits juice drinks.
The company’s premium range of nectar and fruit juice were introduced in 2010 in one of the most modern Tetra Prisma 1 litre packs with stream caps. This range included juices in mango, orange, pineapple, guava and tropical mix fruit, mango/orange and pomegranate flavours. This was followed with its launch of Tetra Prisma 330ml pack with Dream Cap. This one too featured a range of innovative flavours from the popular juice varieties to include strawberry and banana juice with added soya protein, pinacolada and lynchee.
Having successfully established its presence in fruit juice and bottled water market, Bakhresa Group ventured into a new phase of beverage market in the year 2011 and started producing carbonated soft drinks and malt flavoured beverages. Further expanding its soft drink product range, the company entered into a production agreement with Nichols Plc, United Kingdom based producer of Vimto drinks in 2018, to produce the drink locally.
Nothing seemed to slow down the processing giant as it further extended its line of businesses to dairy sector by installing a world class, sophisticated dairy plant in Zanzibar in 2014 to produce UHT milk such as full fat, low fat and flavoured milk. The plant has a processing capacity of 180,000 litres of milk per day.
The Group is planning to launch yogurt and other dairy products soon but has already stamped its presence in the ice-cream market with its Azam and Nova brands – in which it is a clear favourite of consumers across the country and the largest operator. BFPL reveals that is proudly associated with Danice a/s, a sister company of Tetrapak from Denmark for their product and process development and its ice cream plant has world class machineries and equipment from Teknoice and Catta-27 of Italy.
Further expanding its offerings, the Tanzanian manufacturing behemoth runs the largest bakery in the country producing the popular Azam brand bread, biscuits, cakes and donuts. The state-of-the-art facility also manufactures high quality ready to use white and brown chapattis and samosa leaves.
In its sleeves of tonnes of investment in Tanzania, its flag-ship company SSB is nearing completion of the first phase of the US$300 million Bagamoyo Sugar Limited that is set to officially start production by June 2022. The project, which has three phases, is expected to commence with an installed processing capacity of between 30,000 tonnes and 35,000 tonnes, with the annual processing capacity later expanded to 100,000 tonnes.
Venturing abroad
Milling being its core business, Bakhresa Group has set up operations in over five countries in sub-Saharan Africa. The company tested the abroad water by opening its first mill in neighbouring Uganda in 1998. Situated in the country’s capital Kampala, Bakhresa Grain Milling Uganda Limited commenced operations with an installed wheat milling capacity of 250 tons per day. This was later increased to 450 tons per day in 2004, and later more than doubled to 1,050 tons per day in 2011, thereby becoming one of the largest wheat mill references in the country.
Further spreading its operations in the region, Bakhresa incorporated its Malawian subsidiary in 2003 following the company’s take-over of assets of the former government parastatal, Grain & Milling Company Ltd (GRAMIL), under the Government of Malawi Privatisation Programme. Following the acquisition, Bakhresa invested in an ultra-modern 250 tons per day capacity wheat mill and later doubled it to 500 tons per day in 2009.
Bakhresa’s quest to become a leading player in the grain and milling industry did not stop there as the company in 2006 opened the Bakhresa Grain Milling Mozambique Limitada. The grain handing and bulk storage facility was set up inside the port of Nacala with a capacity to receive 600 tons of grain per hour and storage capacity of 30,000 tons. Later in 2012, the company commissioned an ultra-modern 250 tons per day capacity wheat mill with a 30,000-ton wheat storage silo in the Special Economic Zone of Nacala Industrial Area. The milling capacity was increased to 500 tons per day in 2013.
The deep-pocketed manufacturing conglomerate set base in Rwanda in 2009 with the objective of manufacturing high-quality wheat products to cater to the local demand in the country and export to Eastern Congo and Burundi. The Rwandan mill is one of the pioneer facilities to be set up in the Special Economic Zone in Kigali. It boasts of a wheat milling capacity of 500 tons per day, serviced by storage units with capacity to hold 12,000 tons. The investment in Rwanda enabled Bakhresa to knock the doors in Burundi and commenced production in the East African nation in 2013 with a wheat mill of 360 tons per day processing capacity.
In the same old-fashioned way of seeing gems in run down and defunct facilities, the milling giant acquired the old Union Flour Mill Building in Durban South Africa in 2015, turning it into a new 750 tons flour mill – becoming one of the few food companies from the rest of Africa to successfully invest in South Africa.
Azam fruit juice processing division has the capacity to process 350 tonnes of fruits and vegetables daily and stores the pulp/juices/concentrates in 210 litres aseptic bags.
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This investment was followed in quick succession with Bakhresa’s acquisition of Zimbabwe’s second largest food and milling company Blue Ribbon Industries Limited (BRI) in 2015 for US$40 million. The Tanzanian company came to the rescue of BRI which was put into final administration in 2013 after the company collapsed in 2012 due to a cash shortage. The company later opened a new US$6 million wheat milling plant in 2018 with a capacity of 9,000 metric tons per month and a storage capacity of 700 tons of wheat. Blue Ribbon’s units include BRI Logistics, Blue Ribbon Foods, JA Mitchels and Nutresco Foods. The subsidiaries engage in wheat and maize milling, stock feed manufacturing and production of peanut butter, corn soya blend, mahewu drink and soya chunks.
Supporting operations
Bakhresa’s operations both in its home country and across the region are supported by its other sister companies. For instance, its packaging needs are met by its poly-propylene woven bags unit in Mozambique commissioned in 2012. The facility which specializes in producing quality woven sacks both plain and printed, produces 40,000 bags per day catering to the needs of industrial and agricultural sectors. In Tanzania the company runs the Azam Polysacks Limited, a leading manufacturer and exporter of polypropylene/HDPE woven bags/fabrics generally used for bagging of grain, flour, sugar, salt etc.
In addition, the company manages one of the largest flexible packaging companies in Tanzania, Omar Packaging Industries Limited (OPIL). OPIL produces milk pouches; shrink-wrapping; LDPE sheeting in rolls, carry bags and water pouches; HDPE shopping bags; bread bags; laminating for snacks, rice, confectionery, sugar, among others. State of the art multi-colour flexographic printing machines from Europe are used to print the papers.
Further to that, Bakhresa has set up an export-oriented packaging manufacturing unit dubbed Paperkraft International Limited. The company produces small size paper bags and outer bags used for packaging of flour, sugar, salt etc. The plant uses raw materials from renewable sources in addition to reusable waste to make its products.
Meanwhile, for its transportation needs, the group has set up a transportation division, playing a crucial role in the supply chain process. Said Salim Bakhresa & Company Limited offers cost effective options for all transportation and logistical needs within Tanzania and from the country to neighbouring landlocked countries.
Securing the identity
Having found the correct balance of extensively investing in different sectors, producing quality and affordable products and most importantly building a strong brand, Bakhresa has managed to win both in home and abroad markets.
But its secret ingredient seems to majorly lie on its unique identity. Bakhresa took steps to protect the Azam trademark in 1999, as it began expanding its product line as it entered overseas markets. A strong trademark is particularly important in less developed and very diverse markets in which many languages are spoken, making consumers seek symbols to help them choose the correct product. Brand names also have real economic implications. For instance, Azam being well known enables the company to launch new products in an economical and efficient way.
According to a survey by Brand Africa, Azam was one of very few East African brands to join Apple, Samsung, Google, Microsoft and Coca-Cola on the list of Africa’s 100 most valuable brands in 2015. Ferociously protecting the brand, the company in 2019 rebranded its Azam wheat flour into multipurpose flour in a bid to address unlawful copying of Azam product features and re-bagging.
Despite Azam brand being synonymous in most households in the region, Bakhresa in 2018 rebranded its fruit juice range to African Fruti to boost market penetration across the globe. The fresh look features a vibrant African setting, targeting mostly abroad markets such as China and the United Arabs Emirates (UAE).
With the transformation of Bakhresa from a small family run business to a multi-industrial conglomerate, both established and growing businesses can grab a page or two from the company’s journey to success script.
This feature appeared in the July/August 2021 issue of Food Business Africa. You can read this and the entire magazine HERE
Not so many businesses can boast of having brands that are household names, resonating with consumers of all ages and different social walks of life. Deemed as one of Africa’s success stories, Bakhresa Group, a diversified industrial conglomerate headquartered in Tanzania, is one such company
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