By Tauraui Mangudhla
Packaging manufacturers in Zimbabwe are missing out on multi-million dollar business opportunities due to a lack of capacity.
Tanganda Tea Company Limited, an agricultural trader listed on the Zimbabwe Stock Exchange, says it has been forced to import $4 million worth of packaging materials a year.
NewsDay Business was informed on Friday that local producers did not meet Tanganda’s product specifications.
Available information suggests that local producers often failed the quality test and in some cases did not obtain the quantities needed.
“We always give priority to local producers because their workers are our customers, so if we support them, it also benefits us,” said Tanganda’s chief financial officer, Henry Nemaire, during a tour of the manufacturing plant. company last week.
“But there are times when it is enough to import. We import 70% of our packaging materials in terms of cost and that’s about US$4 million per year. The big boxes you see there are 100% sourced locally, but that’s only 15% of our total costs,” Nemaire said.
The company mainly imports from India, Spain and China.
Although the group is focusing on building a new, more diversified business with other revenue streams that should come to increase cash flow, Tanganda remains roughly a tea business with 60% of revenue coming from the harvest.
Perhaps the mix will change along the way, depending on management, as herbal tea varieties are introduced along with other non-tea products.
A deliberate push on macadamia, avocados and coffee primarily for the export market is underway, management said during the tour.
The company currently employs over 5,000 people, the majority of whom work on its tea estates in Manicaland.
Tanganda is known for coffee, macadamia nuts and avocados and as the main exporter to the region for agricultural products.
It exports 80% of its tea products, nearly 90% of avocados.
Tanganda had total assets worth $5,183,482,196 as of March 31, 2021.
Tanganda began in the 1920s as a tea-growing experiment and has since grown into an export-oriented company with two main operating divisions: agriculture and beverages.
The company has invested in its brands such as Tanganda Tea, Stella, Tips and Fresh Leaves.
Currently, Tanganda controls 70-75% of the local market.
Tanganda listed on the ZSE in February, with management optimistic about the positive fallout.
“The business has three operating divisions, agriculture, beverages and corporate and administration divisions,” said Timothy Fennell, managing director of Tanganda.
“This speaks to our shared vision to be Africa’s leading premier agricultural company. In this regard, the company has made it its mission to build a highly cohesive team and management systems, to develop iconic and high-quality preferred brands, to maintain high moral responsibility to its staff, community and people. environment, to pay a constant and growing dividend. to shareholders and compare themselves to the top 20 African agribusiness companies.
Tanganda has transformed over the years from a tea company to a diversified agricultural export business, making it an attractive investment.
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