Conventional brewing in Kenya is taking a back seat as more craft beer brewers emerge from the East African country.
Beer crafting is a relatively new term coined from what was previously known as microbrewing. As the name explains, this is the brewing of beer by small, independent and traditional local companies, which is considered to be crafted and not manufactured because it is not on a large production basis.
Alan Murungi, founder and MD of Ozzbeco Ltd, was one of the first individuals to break out of the conventional mould. In 2006 he opened the first boutique brewery business in Kenya. The Sierra Brasserie is home to Sierra Premium Beer, which is made up of the Sierra Amber, Sierra Blonde and Sierra Porter brands. Murungi says the inspiration came from a trip to Thailand years ago where he noticed a trend of microbreweries – a combination of a brewery and restaurant.
On his return to Kenya, he decided to establish a similar brewery in his home country. However, getting the business off the ground presented its own set of challenges. “I knew nothing about making beer, so I went to the University of California to do a brewery programme. After that I worked at a microbrewery in the US, which gave me extensive training on German brewing.” The pure German tradition is evident in his brew which is produced with no preservatives, no additives and no added sugar.
Murungi confirms that branching into the beer-making business is not easy. Firstly, capital is not easy to come by. “You would need around $2-3m as capital to set up a microbrewery of this size. Our current production capacity is at about 20,0000 hectolitres and 80% of our sales are within Nairobi.”
Secondly, entering a market which is dominated by large multinational companies can be intimidating. “Competing with the multinationals is difficult mostly because of resources. Like any other commercial product, the consumer needs to know that you exist, try your product, become a loyal customer, and have consistent access to the product afterwards, which is a long and difficult chain,” he states. “When you are competing with companies that have big budgets to take care of distribution and marketing, it becomes a bit difficult. We have to be clever in understanding our niche, our consumers and where they are.”
Thirdly, lack of infrastructure and the high price of energy can cause delays in production. “We source our raw materials locally but sometimes we have to import and we experience delays at the port. For instance, we import malt from Germany, which makes up less than 5% of the composition of a bottle of beer,” he says.
Despite the challenges, Murungi has no doubt that he made the correct investment choice. “The concept behind a microbrewery is that it is small and unlike large breweries – this is more about art and not just churning out products. Our target market, the 21 to 40 year olds, are young, professional, ambitious Kenyans. They are the type of people who are looking for quality, to be different and to distinguish themselves. As the economy continues to grow so will alcohol consumption. In another 10 years, the Kenyan beer industry could be five to six times what it is today. As people become more affluent, they demand more premium products. Currently our premium market is 5%, but growing.”
Tapping into a growing market
Big Five Breweries is another firm that has entered the untapped market of crafted beer. Established in 2009 by Canadian-born and Kenyan-raised Aleem Ladak, Brew Bistor & Lounge is a restaurant-brewery in the heart of Nairobi. Ladak is no stranger to the beer-making industry having previously worked at Heineken as a professional brewmaster. “When the beer market was opening up in East Africa, I decided to come back and do something unique. I found a gap in the premium market for a craft brewery. Good beer has to go with good food and entertainment that’s why we have a fine dining restaurant and a lounge and bar.”
Ladak has a clear understanding of Kenya’s developing niche market, which is beginning to appreciate the difference between freshly brewed beer and bottled beer – and is capitalising on it. “The draught beer market is still developing in Kenya and we expect it to get even better. I have been brewing for 15 years now and I know draught beer is always better than bottled beer. Initially we were only selling our beer in-house, but now we distribute to 15 outlets in Nairobi. The idea is not to go mainstream, but to expand the niche market and be in select areas throughout Kenya and the region.”
Big Five Breweries produces five kinds of beers named in Swahili after the iconic big five animals. There is “Chui” (leopard) a German-styled kolsch, “Simba” (lion) a pilsner, “Tembo” (elephant) a dark stout, “Kifaru” (rhino) a Belgian-style bock, and “Nyati” (buffalo) an American-style pale ale. The beers vary in strength from 4.8% to 6.5% alcohol.
Ladak acknowledges that competitive pricing is a big problem. “The high prices are mostly due to importing ingredients and equipment. However, at the end of the day if you provide a good quality product and service then wherever you are, whether in Kenya, the UK or the US, it will work with time. It also helps that there’s a middle class that’s really growing in Kenya,” he states. “Young professionals who have travelled or studied abroad, have some disposable income and want to try something different.”
Big Five Breweries: Tel +254 20 386 4041; email@example.com; website: www.thebigfivebreweries.com
Ozzbeco: Tel +254 20 556 960; firstname.lastname@example.org; website: www.sierrapremium.com