StrongPack & Sidel Partner To Create Leading Co-Packing Hub For Non-Alcoholic Beverages In Africa
Friday, April 3rd, 2020
StrongPack Ltd. recently established its operations in the Nigerian market with the mission to become the number one, high-quality, non-alcoholic contract packaging company in Africa. As part of this greenfield project, they installed a total of four Sidel lines over the span of two years, including a can line, two regular complete PET lines and one PET line integrating Sidel’s Actis coating system. The latter one was critical to increase the drinks’ shelf-life, thus addressing some of the challenges in the local distribution chain. By choosing Actis, StrongPack could lightweight the bottles by 25 percent while redesigning their shapes.
Carbonated soft drinks (CSD) are the second most popular beverage category in Africa, after bottled water. This segment continues to grow mainly due to the fact that the consumers’ purchasing power is steadily increasing on a continent with the youngest demography globally (Euromonitor, 2018). However, distribution is complicated by long transportation routes and difficult road conditions, creating a large demand for bottled drinks with longer shelf-life.
Within this emerging market, Nigeria is a very interesting case. With 195.9 million inhabitants and a population growth of 2.6 percent in 2018 (The World Bank), it has been showing a healthy CSD performance over the last few years, even during economic slumps (with a volume growth of 11.1 percent CAGR from 2012 to 2017). This phenomenon was mainly driven by population increase, price competition and aggressive marketing campaigns from the major global CSD players (Euromonitor, 2018).
A Long-Term Business Approach Focused On Innovation
Witnessing these business opportunities in the CSD market, StrongPack started their operations in 2018 as a co-packer of non-alcoholic beverages with some ambitious goals.
“In the next five years, we want to become the number one non-alcoholic contract packaging company in all of Africa,” explains Del Tupaz, Managing Director at StrongPack. “At the same time, we aim to be the leading high quality co-packer in Nigeria, whatever the brand. This is fundamental to our business approach and it is definitely paying us back. We have recently started co-packing 60 cl PET bottles for a leading global soft drink company,” he adds.
When starting their operations in Nigeria, StrongPack needed to differentiate themselves and their capabilities from the existing players in the market, in a country that has historically chosen returnable glass bottles as the main packaging format. They did this by investing in state-of-the-art technology for PET and can production, thereby expanding the range of packaging options they could offer to their customers. PET, for example, is well renowned for the convenience, the reusability and the performance it can provide through the supply chain. However, given the hot temperatures and the tough logistics in Nigeria, handling PET packaging is more demanding compared to other parts of the world. Some products are displayed and merchandised outside on open marketplaces, often directly under the sun, a distribution set-up which leads to carbonation loss. Additionally, with poor road conditions, bottles are shaken during transportation, increasing the loss of carbonation further.
The Managing Director of StrongPack adds, “We were looking for a solution that would help us overcome some of these challenges. After careful consideration, we found that Sidel and their Actis system—as integrated in a Combi configuration in one of our complete PET lines—was what would fit the local value chain conditions best.” This decision makes StrongPack the first and only beverage producer in Africa who has Sidel’s Actis technology installed and is able to provide coated PET bottles for CSD.
Lightweighted Bottle Saves Three Tonnes Of PET Resin Per Day
Helped by the Actis technology and the increased shelf-life of the PET bottles, StrongPack plans to reach additional markets in West Africa that otherwise would not be available to them. Choosing Actis also offered the opportunity to develop a new bottle design for their 35 cl and 50 cl formats, which not only matches Actis’ requirements but also stands out at the point of sale— a key factor in the Nigerian market.
“Today, we are particularly pleased with Actis, so much so, that we have renewed our confidence in Sidel and already ordered a second PET line featuring this technology,” StrongPack Chairman, Eric Thibault, concludes proudly.
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