E-Malt.com News article: Lebanon: Heineken-owned Brasserie Almaza moves ahead despite 34-day war losses

As many multi-national companies ponder how to cut their losses in Lebanon's lethargic market, Brasserie Almaza and parent company Heineken say the Lebanese brewery is staying put and moving ahead with an aggressive marketing strategy for the rest of 2006, The Daily Star posted September 04.

Though Almaza has inevitably suffered losses from the interruption of the high season for beer sales and from Israel's ongoing air and sea blockade, Lebanon's only brewery has been able to continue business as usual.

"Like most of the country 2005 was a bad year for us, but this year up till June we were breaking all records and looking at our most successful year ever, and this is true for a lot of companies," the managing director of Almaza, Ronald Voorn, told The Daily Star at the company's headquarters in Dora.

"In Heineken the way we look at it is very simple: Once we have an investment we are going to make it work and now we are more determined than ever, if it takes two years, three years, whatever," he said.

During Israel's 34-day war on Lebanon, Almaza was able to fill existing orders by varying routes based on available security information. The company managed to get shipments to Dubai through the Latakkia port in Syria and only had to interrupt regular production and distribution for three days in the past seven weeks.

"During the war our team still managed to find routes out of the country, like when [US Secretary of State] Condolleeza Rice was visiting: We knew it would be quiet so we made use of that."

Dutch company Heineken - which acquired a majority stake (69 percent) in Almaza in 2002 - earlier demonstrated its commitment to the local market by going ahead with a rebranding campaign in the wake of former Premier Rafik Hariri's assassination. Rather then opting to cut and run, Heineken funneled money into Almaza to "pull it into this century." The brewer launched advertising campaigns to raise awareness of new products, ramped up training for the local sales team and repackaged the classic beer.

The strategy apparently paid off. Since 2005, sales of Lazeeza, the company's non-alcoholic beverage, have been growing consistently across the country, and demand for Almaza is rising in Canada, the US and Australia. Voorn estimates about 20 percent of Brasserie Almaza's total sales come from exports, and sales to foreign markets are set to double this month, based on September's contracts.

Some of Almaza's local suppliers have not fared as well. On July 18 Israeli rockets destroyed the production facilities of the Indian-owned Maliban Glass factory, which manufactures the brand's bottles.

A few steel girders rising from piles of rubble are all that is left of Maliban's plant in the Bekaa Valley, though the warehouse holding Almaza's latest order was spared. The day the cease-fire went into effect the shipment was delivered, allowing Almaza to continue regular production for at least the next few months, says Voorn, depending on the level of sales. He hopes Maliban will rebuild, but if not there are local and international alternatives. Voorn says they can also circumvent the production limitations arising from the blockade by continuing to import raw materials - like the malted barley Almaza uses to brew its beer-at a much higher cost from the port of Latakkia.

"We all wish the blockade will be lifted tomorrow, because you can see what it's doing to the economy," Voorn said. "I'm always optimistic, but I can't say when because we are not in control of it, and that's really the humiliating part."


06 September, 2006