FARM TO TABLE DAIRY MARKETING IN RWANDA

AL PRESENTATION OF SALES FOR MAY 2016

Contents ´  Inyange Industries background

´ Milk Suppliers & processors

´  Inyange Dairy Products

´  Inyange distribution model

´ Cold Chain

´ UN Mission

´ Milkzone

´ Critical issues along the dairy value chain in Rwanda

´ Q & A

Some  facts  Rwanda-­‐‑  Economy. ´  GDP annual growth at 8% for last 5 years

´  Agriculture contributes 40% (about 6% of which is from

livestock) of the country’s GDP,

´  Milk production is growing at the faster pace than predicted demand,

´  But less than 50% reaches the market of any form, with the price of raw milk being 1/3 of processed milk.

´  It is estimated that approximately 64% of milk marketed is in the informal market

´  Surplus milk cannot be consumed in any other form due to small domestic market

So what’s Inyange?

Inyange is Kinyarwanda for Cattle Egret, a white-feathered bird from the African Great Lakes which is often to be seen perched on the back of big mammals (Cattle, Horses…etc.) using that vantage point to scrutinize the horizon. In Kinyarwanda it represents “Purity” thus Inyange as a company derives its Theme, “Fresh Taste, Healthy Living.”

Company ´  Inyange Industries LTD is a Rwandan private Limited Company incorporated in

1997. The company is owned by local share holders and is a subsidiary group companies under Crystal Ventures Ltd (CVL).

´  Inyange has been a successful brand in Rwanda for last 16 years. The Company has been processing and packaging dairy products, fruit based juice products and mineral water.

´  In order to satisfy customer demand (both in and out of season) and remain a significant player in the Agro-processing industry in Rwanda, the company has significantly expanded its capabilities to produce both short shelf life and extended shelf life (ESL) products

´  All products have obtained the certification and quality mark of the Rwanda Bureau of Standards (RBS) and ISO 22000: 2005 Food safety Management system certification as an intended food processing facility.

Cont.. 7

Vision: To be a leading East and Central African Dairy and Beverage brand , producing high quality products while enhancing shareholder’s value Mission: To secure the highest value for all stakeholders in the food value chain while enriching the lives and health of all consumers with the most nutritious and tasty choices through wide range of dairy and Beverage products Core Values: Results driven: Our focus is driven by our desire to achieve and exceed intended goals Integrity : We are honest, transparent, ethical and objective in everything we do Innovation : We always challenge ourselves and seek new ways of doing things Excellence : We strive to exceed highest standards in everything we do. Leadership : We take initiative, be proactive, be committed, ownership and accountability, be visionary, lead by and be team players.

Cont: Masaka Plant: •19 km from Kigali •Dairy, juices, mineral water •80-90 tones of raw milk per day •2016: 17,129 tones of dairy, 10,548 tones of mineral water, 4,631tonnes of juices. •60% share in Dairy market •  Paid about 5b Frw for milk and 320m Frw

for local fruits in 2015.

Savannah (Nyagatare): 150 km from Kigali (near Uganda border) Dairy, milk collection (milk trunks, Cans(50 L) 55 Mt. of raw milk per day after chilling sending to Masaka everyday

How do we source our Milk?

Milk Collection Center ´  Inyange collects its milk from the different

farmers that are into set in co-operative.

´  1226 in Nyagatare, 684 Gicumbi, 405 Rwamagana, Gatsibo 264 and Kayonza 400 farmers

´  Currently we have a 3 years contract between the Nyagatare Dairy Farmers Union (NDFU) and Inyange Industries Ltd

´  In Gicumbi District, MCC's are totally owned by cooperatives.

´  Basically, all MCC's are managed by cooperatives a part the ones from Nyagatare.

´  Rwf 5 billion paid out to farmers last year

´  Doubled collection from MCCs

´  Capacity building in the sector through MCCs

Milk Collection Centers

Products and market share

Inyange products enjoy a dominant market position in Rwanda when compared to other local players…

Key competitors are small scale unsophisticated raw milk suppliers/agents

Products Market share and position

Dairy products

n  Milk

n Pasteurized and homogenised whole Milk; UHT milk; Fresh Cream

(UHT (500ml and 1ltr); Pasteurised Tetra Fino and Jerry Can (250 & 500ml and 1, 2 &5 ltr); Skimmed (bottle); Ikivuguto 2ltr milk; Low fat pasteurised (500ml); UHT low fat; raw milk; fresh cream 500ml; and milk dispensers

n Currently has 80% of the market for pasteurised milk

n Has 80 % market share of the UHT market

n  Yoghurt n 130ml, 250ml and 400ml yoghurt

(plain, strawberry, apricot, pineapple, vanilla, and banana)

n Currently holds 60% of the market

n Company aims to diversify into cheese, butter, ice cream and ghee

Juice

n  Pulp to juice n Passion fruit and pineapple juices

(Bottle; 500ml and Tetrapak)

n Currently holds 70% of the market

n  Concentrate to Juice

n Orange, mango and apple juices

(Bottle; 500ml and Tetrapak)

Water

n  Mineral water n Mineral water from own spring in

Rwanda

(500ml, 1ltr, 18ltr and gallon) n Estimated market share of 80%

Dairy assortment

Distribution Model

Inyange currently has distributors across the country. These are divided into 2 areas-

Kigali and Upcountry. With 4 Distributors in Kigali and Upcountry having 8 distributors.

Kigali is considered the main areas of business transaction with 75% of the total revenues

generated.

The current Kigali distributors cover the noted areas below:

§  NYARUGENGE-NYAMIRAMBO-MUHIMA

§  NYABUGOGO-GISOZI-NYARUTARAMA

§  KICUKIRO-KABEZA-GIKONDO-NYAMATA

§  KIMIRONKO-KANOMBE-MASAKA-KABUGA

Manufacturers/Producer

Distributors/Dealers/Wholesaler

Consumers - End users

Distribution Channel

DIRECT CHANNEL

WHOLESALE CHANNEL

MULTI CHANNEL

Retailor-Points Of Sale

DIRECT CHANNEL

•  Use of Merchandisers •  POS material

•  Branding of at all Inyange Outlets and POS

•  Inyange to train distrib. sales team

•  Training on product handling

•  Customer feedback

Export Market ´  Since 2014, Inyange has been exporting its

Milk to the UN contingents in Juba, Goma and Bukavu.

´  Low Fat and Whole Milk is mostly consumed milk.

´  Since last year Inyange has been processing and parking Emborg Milk and exported to the region.

´  Have recently established distributors In Uganda and Tanzania.

Cold Chain Products ´  We currently have 4 Key routes that re

being serviced by Inyange by our Cold Chain trucks.

´  We are planning to have this number increased to 7 by the by end of Year.

´  Cold chain products entails : Yoghurts, Butter, Ghee, Fresh cream, Cultured Milk…etc.

´  These will be classified into segments for better management and planning.

´  Supermarkets

´  Government Institutions

´  HORECAB – Hotels, Restaurants, Cafes and Bars.

´  The current fleet of delivery vehicles will be increased gradually as we increase the number of clients.

Inyange Milkzone

Inyange Milk is high in quality

´  Inyange sources Grade A milk only from farmers

´  Inyange sources milk that meets the standards set by Rwanda Bureau of Standards

´  Inyange is the only agro-business in Rwanda that is ISO certified

Inyange Milkzone is safe & ready to drink

´  Inyange only provides pasteurized milk

´  Safe handling of the milk from collection to the consumer confirms to ISO 22000 Food Safety Standards