Kenyan Products a Global Success Story

The East African nation of Kenya has become synonymous with high-quality agricultural products, and offers lessons for other countries across the South. The country has been able to combine innovation in new technologies (it is a pioneer in mobile phone applications like m-banking), with quality control for its products like the Coffee Kenya Brand logo (http://www.coffeeboardkenya.org) and ease of access to information on Kenyan products and resources via the internet – crucial to drumming up international business – like the SME Toolkit Kenya (http://kenya.smetoolkit.org/kenya/en) .

There are several advantages to improving standards and productivity in agricultural products in Africa. The first is regional: greater productivity and efficiency will help in reducing malnutrition and food crises that have plagued the continent for decades. Secondly, it also allows Africa to export food to other countries with fast-growing economies and boost the continent’s wealth.

The dramatic changes taking place in African countries – especially rapid urbanization that has made the continent home to 25 of the world’s fastest growing cities (International Institute for Environment and Development) – means there is an urgent need to increase food production and stabilize rural economies to support farming.

Kenya is considered home to one of the continent’s most successful agricultural production zones, with multiple agricultural products and brands developing a solid global reputation for quality.

The country benefits from the fertile Great Rift Valley (http://en.wikipedia.org/wiki/Great_Rift_Valley) , where the country’s biggest crops – tea and coffee – are grown.

Agriculture is a key part of Kenya’s economy: 75 percent of the working population is employed in the sector. Farming sits behind tourism as the country’s second biggest contributor – 20 percent – to the gross domestic product (GDP).

Kenya has had a great deal of success with fruits, vegetables and flowers (Kenyan flowers are a mainstay of many European supermarkets). Kenya has been able to achieve this by using well the 10 percent of the country’s land that is suitable for farming.

Around Mount Kenya (http://en.wikipedia.org/wiki/Mount_Kenya) , the cool and wet climate is perfect for farming tea, coffee, flowers, vegetables, corn and sisal. Other products that have been successfully grown include sugar cane, pineapple, cashew nuts, cotton, and livestock-related products – dairy goods, meat, hides and skins.

Kenya’s main export markets are the United Kingdom, the Netherlands, Pakistan and the United States. This agricultural export success has had a knock-on effect of reinforcing a global reputation as one of Africa’s best countries for business.

In the tea market, James Finlay and Williamson have a strong reputation and sell to major supermarkets in the UK.

Another successful tea company is Kenya Tea Packers Limited (Ketepa) (http://www.ketepa.com) . A Kenyan-owned company, it enhances the standard of living of the small scale tea growers of Kenya who are the bulk of its shareholders.

Kenya is one of the world’s top 20 coffee producers and has a good reputation for its Arabica beans. Kenya produces 2 million bags of coffee a year and the coffee industry employs 6 million people (www.coffeeboardkenya.org) .

When it comes to exporting flowers (http://www.kenyan-flowers.com) , Kenya is a global powerhouse: 38 percent of the world’s exported flowers are grown there. The majority – 97 percent – are sent to the European Union. Its popular flowers include chrysanthemums, roses and carnations. This time-sensitive crop benefits from the air links of its capital, Nairobi.

Kenya even has a successful brand of beer, Tusker Lager (http://www.tuskerlager.co.uk) . It is a leading export and is proudly African, with its elephant logo and motto “My beer, my country.” It has a large market in the United Kingdom.

By David South, Development Challenges, South-South Solutions

Published: June 2010

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

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A Local Drink Beats Global Competition

For many decades, strong American and multinational food brands have penetrated markets in the South. This is a global business success story for those companies, but the downside has been the marginalizing of local alternatives. This not only reduces wealth-creating opportunities for local entrepreneurs, but also leads to products like sugary soda pops (http://tinyurl.com/yzwal98) pushing aside healthier, local alternatives like tea.

But one company in Indonesia has been pioneering a healthy local drinks empire while also seeing off aggressive foreign rivals. Teh Botol Sosro, a tea drink in Indonesia bottled by family-owned business Sosro, was not only the first bottled tea brand in the country, but also in the world, it claims. The company started bottling the jasmine-flavoured black tea drink in the 1970s.

The Indonesian company has shown that it is possible for local flavours to beat powerful international brands like Coca Cola in the battle for drinkers’ palates. While Coca Cola has tried to sell many bottled tea drinks in the Indonesian market, they have not been able to push aside the local product, The Teh Botol Sosro. Brewed by the Sinar Sosro company, it has captured 70 percent of the non-carbonated drinks market.

It is a drink of cool, black, sweetened tea with a hint of jasmine. Invented by the Indonesian family of Sosrodjojos, Sosro (http://www.sosro.com/) was founded in central Java in the 1940s.

Culturally, Indonesians have either coffee or tea with their meals. The brand’s marketing slogan plays on this: “Whatever you eat, you drink Teh Sosro.”

The company has aggressively fought off competition not only from local rivals, but also from Coca Cola’s Frestea brand and Pepsi Cola’s Tekita. The company stayed sharp in its business strategy, never letting a rival product take hold. Just as a rival would introduce a new product, Sosro would reply with a new drink attuned to Indonesian tastes. This ability to not be complacent about the company’s success, and to use its knowledge of local tastes to always outsmart foreign competition, has kept the company where it is today.

Sosro pioneered bottled drinking tea with its launch in 1970 and started with a dried tea only distributed in Central Java.

The journey to cold, bottled tea is an amusing one. The company first wanted to promote its tea in Jakarta, the capital, by having public tastings. But by brewing the tea on the spot, the too-hot tea took too long to drink for impatient Jakartens. The solution was to not brew the tea on the spot, but instead to brew it off-site and deliver to markets in big pans on trucks. But the bad roads made this a bit of a mistake as well: the tea would spill on the journey.

The ‘aha’ moment came when the idea arose to store the brewed tea in bottles. The bottles were eye-catching and have evolved in design over the years.

The drink now comes in various packages, from a returnable glass bottle (220 ml) to a Tetra Pak (1 litre, 250 ml, and 200 ml) and a 230 ml pouch.

The Botol Sosro (http://www.sosro.com/teh-botol-sosro.php) is not the company’s only product: it also brews Fruit Tea, The Botol Kotak and S-Tee. The economic benefits of these popular brands stay local, as Sosro gets the tea from PT Gunung Slamet, which operates three tea estates covering 1,587 hectares in Indonesia.

By David South, Development Challenges, South-South Solutions

Published: March 2010

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

Follow @SouthSouth1

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Southern Innovator Issue 2: https://books.google.co.uk/books?id=Ty0N969dcssC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 3: https://books.google.co.uk/books?id=AQNt4YmhZagC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 4: https://books.google.co.uk/books?id=9T_n2tA7l4EC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 5: https://books.google.co.uk/books?id=6ILdAgAAQBAJ&dq=southern+innovator&source=gbs_navlinks_s

As cited in Export Now: Five Keys to Entering New Markets by Frank Lavin and Peter Cohan (Wiley).

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