Against all odds, Keroche unveils Summit Malt beer

 By Morris Aron

Local beer manufacturer, Keroche Industries, launched its Summit Malt on Thursday evening, digging its feet into the beer market share wars against brewer giant East African Breweries Limited (EABL) and a host of other international beer makers who have crept into the market.

Summit Malt targets the middle-income market, the same category with EABL’s Tusker malt.

Speaking during the launch of the brand, Keroche Industries’ Managing Director, Tabitha Karanja, said the product, launched three months after schedule, signified the support of consumers for a local owned company.

"This signifies the faith our consumers have in our beer, despite the challenges that we have been facing," she said.

Penetrate Market

The launch of Summit Malt boosts Keroche’s quest to penetrate the Kenyan beer market dominated by EABL.

Summit Malt also signifies the determination of the local brewer to compete with international brewers, who have entered the market.

Prior to the launch, there had been speculation as to whether Keroche could produce a malt beer product that could compete with the malt brands already in the market.

During the launch, Karanja explained the struggles that she had undergone to position the company to its current status.

In particular, the firm called on market regulators to come up with tougher penalties to rein in unfair practices that border on ‘monopolistic tendencies.’

"Monopoly anywhere is bad and if you do not have the support of local institutions, it can especially be very bad for upcoming businesses," said Karanja.

Under the current laws, a company that uses unfair means against competition is only fined Sh100,000, while in developed economies, such malpractices carry a price tag worth 10 per cent of the total revenue earned for a year.

Keroche has accused its rivals of trickery in blocking its products from reaching retail outlets.

Last month, Karanja claimed unidentified people destroyed Keroche’s billboards worth millions of shillings, along the Nairobi-Naivasha highway.

But Keroche’s woes in entering the market have been far from easy.

Prior to the launch, the Naivasha-based brewer was rumoured to be in the red and looking for an external investor to inject extra cash to cushion it against effects of a hurried expansion.

Sources, at that time, said Keroche had been considering the option because it needed the extra cash infusion to pay suppliers and open other streams of the beer business, accusations that Karanja laughed off.

"We are not looking for any outsiders to buy the company. Keroche is the first beer company wholly owned by locals and when we are ready, it is Kenyans who will buy the firm, not outsiders," she said.

Karanja also dismissed claims that her company’s flagship Summit Lager was finding the market tough to navigate, but admitted it was normal for it to struggle to find its footing, because it was a new brand.

"It is normal for any new product to struggle, but I can tell you that Summit Lager has done much better than similar brands in other markets," says Karanja.

Product positioning

Talk in the industry indicate that it could be possible that Keroche’s products are facing a challenge due to "product positioning" and a host of unfair market practices.

Keroche has invested almost Sh1 billion in its new beer plant, built by German and Italian engineers. It has capacity to produce 30 different types of brands, but has been producing only Summit Lager until the launch of the malt last week.