Special.T tea boxes by Nestle are pictured in the supermarket of Nestle headquarters in Vevey
Harare - Companies in Zimbabwe are now investing in new lines that can produce smaller packages for manufactured products as cash continues to dry up, with executives from foodstuffs manufacturer Nestlé saying conditions in the economy have necessitated this.

Zimbabwe continues to be affected by low productivity, with manufacturing capacity still below 50 percent according to a survey by the Confederation of Zimbabwe Industries. Although the country has instituted restrictions on imports from countries such as South Africa, Zambia and Mozambique, some foreign goods are still finding their way on markets in the country.

Most of the finished goods still being imported into Zimbabwe include beverages, sugar, rice, chicken and cooking oil among others. This has been bleeding local manufacturers, according to Kipson Gundani, an economist at the Buy Zimbabwe pressure and lobby group.

“Manufacturers are still battling imports despite the restrictions that were introduced last year through Statutory Instrument 64 of 2016,” he said.

Affordable

In a bid to fight the imports and to avail better priced products on to the market. Nestlé Zimbabwe and other manufacturers are now selling smaller packaged products that are “cheaper and affordable” in the Zimbabwean market.

Kumbirai Katsande, the chairperson of Nestlé Zimbabwe, said the Swiss company had invested in a new “filling and packing line for affordable products” as the Zimbabwean economy “demands that you either stop and die or you innovate”.

He said the smaller packages would help the company to reach more consumers while Ben Ndiaye, the managing director for Nestlé Southern Africa cluster, said his company would also try to export the smaller packed products into the region to offset foreign currency and cash constraints the company is facing in Zimbabwe.

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“We are leveraging on local farmers who provide us with the milk to produce our products. The minimum price we had for our products was $1.50 (R19.95), but we were unable to reach all Zimbabweans.”

Economists say Zimbabwean companies are now coming up with survival strategies as the headwinds continue to buffet the economy and incomes continue to decline.

BUSINESS REPORT