Egypt's Non-Beer Beer Hit
Three years after private investors purchased the undesirable Al-Ahram Beverages from the government, the company has been transformed into one of the most profitable in the beverage sector.
The company's blockbuster product is a non-alcoholic beer that has been a hit in Egypt and other Islamic countries, including Saudi Arabia. As of the end of June 1999, company sales had jumped 60 percent and profits by 30 percent or an estimated $26 million. Production has increased 4 times.
Islam prohibits Muslims from drinking alcoholic beverages. Because of this prohibition, the company offers a low-cost home delivery service for people who want to buy the beverage but do not want to buy the drink in a store where passerbys may mistakenly believe they are actually buying real beer.
Al-Ahram has used traditional beer-and-alcohol-type media campaigns to market the product and the company plans to soon sell the alcohol-free beer in Indonesia, the world's most populous Islamic country, and Nigeria.
Al-Ahram's success has defied the odds. When the government first placed the company for sale, investors stayed away because of the difficulties of managing and marketing the product.
And although the business has proven successful, the management must adhere to strict government privatization laws, including one that forbids the company from laying off workers. Thus, the company has reduced the number of workers producing the product from over 3,000 to 800 and directed the remaining workers to other areas such as storage and transportation.
© 2000 Al Bawaba (www.albawaba.com)
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