Nigeria’s biggest brewery, Nigerian Breweries Plc, attracted media attention after announcing that the pricing of certain items will be reviewed upward, starting on February 19, 2024.
The company’s response to “continuously rising input cost” is reflected in this decision, which was conveyed through a letter signed by Lekan Awosanya, Zonal Business Director for the West, and addressed to distributors and customers in the West.
The letter did not specify which goods would be affected by price rises or by how much, but it is the third time in the last two years that the Heineken-owned company has raised prices for its entire line of beer and malt brands. Star, Gulder, Legend, Heineken, Maltina, and Amstel are among the well-known brands impacted by these modifications.
Industry experts attribute these price hikes to various factors such as escalating costs for materials, production, transport, and energy, alongside higher excise duties and an inflationary environment. These challenges have put pressure on profit margins for brewers, prompting adjustments to maintain sustainability.
The timing of the latest price adjustments comes amidst a backdrop of challenging economic conditions, with Nigerian Breweries experiencing mid-single-digit declines in sales volumes throughout 2023. Consumers, facing constraints on discretionary spending, have opted for value brands, impacting the company’s performance in a competitive market landscape.
The letter from Nigerian Breweries also indicated that all distributor orders fully funded and in the system before February 19th would be honored at current prices, suggesting minimal advanced notice for customers and end consumers ahead of the impending price increases.
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