Mars looks to Africa for growth openings

Fast-moving consumer goods company Mars Africa intends expanding its presence on the African continent and has targeted five countries to enter.

Mars Africa, part of the global Mars group, contributed about R1bn in revenue to the group last year, 80% of which is earned in SA.

MD Ian Burton said the company aimed to earn half of its revenue from the continent and would initially focus on entering five countries. Mars Africa would also focus on developing its categories in the local market.

The company focused on three categories – pet care, snack food and main meal foods – and had no intention of diversifying beyond those categories, Burton said.

The family owned group, which turns over $21bn a year, has five brands worth US$1bn – Mars, M&M's, Snickers, Whiskas and Pedigree.

Mars Africa's mid-year name change, from Master Foods SA, formed part of its African expansion plan, which was a key part of its growth strategy, he said.

Mars aimed to develop an official distributor before putting someone on the ground in the five priority countries.

It had targeted Kenya, Ghana, Nigeria, Namibia and Botswana and already had a presence in Kenya and Namibia and would have a representative in Ghana soon. Burton said the company would then set up a sales force in those countries before considering additional investment once critical mass was reached.

Master Foods was incorporated in 1997 after Mars launched Uncle Ben's as a competitor to Tastic rice in 1996. Subsequently, the company bought Royco and Oxo as it moved to localise its food portfolio instead of just importing its other global brands.

Burton said the company aimed to drive consumption of confectionery by making it more available locally.

It also aimed to grow the pet food category, in which it was the market leader, to garner more sales. Burton said pet food was a growth area for the company.

Burton said there was scope to grow the segment as pet food was relatively affordable locally. In addition, South African pets acquired 25% of their calories from pet food, with the remainder coming from scrap food, for example.

Mars Africa, which has factories in Cape Town and Pretoria, employs 250 people directly and 1000 indirectly.

Source: Business Day

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