By Amb. Emmanuel Mwamba
Parmalat Story, What About the Competiton?
…It’s more competition, falling standards and inefficiencies that has seen Parmalat lose the market and shut its plant in Zambia…
Parmalat is shutting down its manufacturing plant in Zambia citing a bad economy, loadshedding and drought.
True factors.
But Parmalat failed to state an important detail to their story that they are facing serious competition from other well-determined players in the Fast-moving consumer goods (FMCG) market.
Let’s take for example, Zambeef.
ZAMBEEF
Zambeef has ZamMilk and delivered on the backbone of a strong distribution network of chickens and meats.
TRADE KINGS
The giant killer, Trade Kings that saw Lever Brothers with its renowned international brands of scouring powders(Surf, Omo), soaps (lifebouy, dove) scamper and retreat to Nairobi Kenya and had its products literally replaced by an aggressive and consistent marketing and advertising campaign, and over the years, Trade Kings built probably the strongest FMCG distribution network that delivers right to the home shop and to the Kantemba.
VARUN BEVERAGES
Varun Beverages,manufacturers and distributors of carbonated PepsiCo drinks, juives and and packaged water.
Varun Beverages introduced Cream Bell longlife milk and also enjoys strong distribution network on the back of Pepsi products.
The above companies are facing load-shedding, a bad economy and have also suffered the severe effects of drought.
I think that Lactalis (Parmalat) must tell the whole story why they are shutting down in Zambia and retreating to the safety regional base of South Africa.
GOVERNMENT
Government must protect the manufacturing industry in Zambia. Over the years, it’s cheaper to trade, distribute and retail products in Zambia than manufacture.
To keep sustainable and real jobs in the economy, we must take the Parmalat development seriously and ensure that we retain a manufacturing industry in Zambia.
Mr. Mwamba so what if Parlamat have shut down. Where is DPB that owned that plant?
Its open season for those who know the market and can be innovative enough to address the issues that affect not just palamat but the entire supply chain down stream. From demand to energy. These are the effects of the draught or maybe it has not occured to you?
Some imwe you want to start crying for government to pump in money cause 100 workers will be unemployed. Remember NAPSA partial withdrawals? This is the time it can only be handy.
Or financial instiution or NAPSA itself can create a loan facility re- payable against the available partial withdrawal “Just to help employees who have unemployed” for a few months. The new buyer will obiviously re-employ them. They will also have their severance package from the old employer. So what is the problem other than the draught Mwamba? Run out of lies to tell?
Is Pamalat the first company to shut down and relocate out of this country? This is a normal occurrence in business. It’s survival of the fittest in this business jungle. Find something else to feed your lies on. This particular one is missed target.
It is folly to downplay the shutting down of Parmalat with simplistic comments like “it is not the first company to shut down”. Mr. Mwamba’s post makes a lot of sense. Look at the message not the messenger. This is not politics. It is about the nation’s survival.
Think of the employee and his family, the farmer who used to supply milk to Parmalat, the technology loss, lost government taxes, the negative impact on GDP (no matter how small Parmalat’s contribution).
Without a good manufacturing base, the economy will falter. The service sector is underpinned by a sound manufacturing base. We need to give meaningful incentives to SMEs to stimulate their growth. This is a challenge to all of us to venture into value addition and built a solid base of home grown SMEs instead of looking to FDIs.
Sir, we are not being simplistic or indeed downplaying this occurrence. What we find upsetting is the insincerity of this company regarding the reasons given for its shutting down. Pamalat should be grateful to the country rather than disparaging us. Yes we need every company and every job in our country but not at the expense of our integrity as a nation.
Ba EMC, is the economy doing well? Has loadshedding and the drought had no impact on business?
Let us be honest with ourselves. Even at household level, wells and boreholes have dried up.
Business have fixed expenses like salaries which have to be paid whether the business is producing or not (during loadshedding).
There are many other companies that will take over the parmalat plant. If the reasons are genuine or not doesn’t matter.
The reasons for closure mentioned are load-shedding and drought.
If they were a serious company, they would have started investing in solar energy instead of crying about load shedding. Did companies in South Africa start pulling out during their load-shedding periods? Companies must learn to adapt. The Chinese will buy the company, and it will take over the Zambian markets.
What about drought? What do you respect the government to do? That is due to climate change, and unfortunately, it will worsen in the future.