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Why the chicken consumer is bleeding


The closely controlled poultry industry in Botswana has resulted in inflation of the general poultry meat prices by 65 percent, as key players in the local industry enjoys government protection at the expense of ordinary consumer, WeekendPost investigations can reveal.


This publication has established that the retailers and franchised fast food outlets are forced by the Poultry Licence Committee (PLC) to procure their poultry meat from local producers precisely Tswana Pride (Pty) Ltd, which controls about 90 percent of the market – and its associated companies.

This has resulted in retailers and fast food outlets buying poultry meat from few local producers who dominate the market at exorbitantly higher price than they would have if they were allowed to buy directly from South African producers.


WeekendPost has also established that although some measures were initially put in place for the best interest of all local poultry producers in Botswana, it has transpired that smaller producers are not able to benefit due to their inability to meet both quality and quantity demands of the franchised international fast food outlets like Kentucky Fried Chicken (KFC), Chicken Licken, Hungry Lion and Nandos among others.


 With the Tswana Pride (Pty) Ltd having superior advantage in terms of infrastructure and capacity, small producers have been taken out of the game. Currently, Tswana Pride (Pty) Ltd is the sole producer which is approved by the Kentucky Fried Chicken to supply its franchisee in Botswana. Other producers are not licensed to supply KFC with poultry meat due to infrastructure, quality and quantity limitations, effectively giving Tswana Pride (Pty) Ltd absolute monopoly over supply of poultry to KFC.


This publication has also learnt that when the demand is high, local fast food outlets and retailers apply to PLC for permit to procure meat from South Africa for a certain period of time. This however has not been able to bear fruits as lack of storage facilities will either force them to procure not enough or engage Tswana Pride (Pty) Ltd to procure from South Africa in large quantity and then sell to them.

This results in local retailers and fast food outlets buying poultry meat at higher prices much more than they would have, had they been allowed to directly from South Africa. Tswana Pride (Pty) Ltd’s monopoly and prices control has inflated the chicken prices meat in Botswana, making it more expensive than in neighbouring South Africa.


Tswana Pride (Pty) Ltd General Manager Wayne Du Toit said the quality of Tswana Pride and its associated companies’ meat is up to standards and revealed that it has never encountered problems with its buyers over the quality of their products.

However, according to the information gathered by this publication, the bone of contention is the price at which Tswana Pride (Pty) Ltd offer its products to fast food outlets especially when it comes to poultry meat which is imported from South Africa, “When we import on their behalf, we consider storage costs because we purchase in large quantity and have to supply throughout the country,” he said.

“The retailers and most fast food outlets do not have the capacity to do so, which means we share the benefits 50-50.”


 Currently Tswana Pride and its associate companies slaughter 160 000 chickens while South Africa producers are able to slaughter 20 million chickens on average every month. Botswana has not been able to meet some demands of chicken meat products like the ‘wings.’


Some of the franchisers who spoke to the WeekendPost have stated that they are aware that some big local poultry producers charge enormous prices after importing at a lesser cost from South African poultry giants. Managing Director for Kentucky Fried Chicken (KFC) Africa, Doug Smart confirmed in an interview that: “we are aware of this and we’re looking into this further and working to build our own local supply chain.”


Out of the 12 KFC restaurants operating across Botswana, he said they have only four local suppliers in Botswana and one supplier in South Africa. According to Smart, KFC Botswana sources their chickens from local suppliers that meet KFC’s high quality standards and specifications.


“Where there is a supplier shortfall, product is then imported from approved South African suppliers. All fresh produce is sourced from local suppliers and other ingredients including spices and breading are sourced from South African suppliers,” he said.


The KFC Africa Managing Director also highlighted that their local (Botswana) suppliers are Tswana Pride, Bidvest Food Service, Mr Veg, adding that Digistics is their South African provider. Although he said in terms of the ownership of their suppliers, he is not at liberty to disclose their information but WeekendPost can reveal that Tswana Pride (Pty) Ltd is owned by powerful businessman Satar Dada, who is the sole local supplier to KFC in Botswana.


WeekendPost has established that the company has benefited due to some import restrictions which unable KFC to import certain products which include poultry, eggs and fresh produce. Although this publication has gathered that the recent closure by KFC is attributed to failure by their supply to meet their high demand, the KFC Managing Director also shared insights that: “the temporary closure of the KFC restaurants in Botswana is due to the restaurants experiencing difficulty in securing approved KFC ingredients.”


While Smarts stated that KFC believes in supporting the communities in which they operate, he however said they are working closely with local suppliers to develop a local supply chain for ingredients that meet KFC’s quality standards – while also ensuring the volume demands of the local KFC system can be supported by supplier capacity.


KFC chicken franchise counterpart and competitor Nandos, through the Brand Manager Simiso Ncube said in their brief interview that “Nando’s Botswana aims to engage local suppliers wherever possible, for our chicken and all other ingredients.” She however would not be drawn into discussing whether they are aware of certain big poultry local producers buying from across the border to re-sell with a higher price to the franchisers.


Investigations by this publication further reveal that at the end of the day, the ordinary man on the street suffers more due to the hefty tariffs on chickens on the shop shelves. This is exacerbated by the fact that franchisers and shops also skyrocket the prices after producers do the same. She said they have two poultry meat suppliers which are both local and have fifteen outlets across the country.


Meanwhile Botswana Poultry Association Chairman Ishmael Mosinyi asserted that the big poultry man has pushed small man against the wall, and therefore now it’s the ordinary man on the street that suffers most.


He said the challenges they face as small poultry producers cascade down to consumers as big producers may charge exuberant prices as they see fit – to consumers.


“Big poultry producers have put their teeth on the market and have proper infrastructure and therefore meet expected standards,” adding that as small poultry meat providers they have been kicked out by big firms and franchisers’ set of high standards.


Chicken Licken Managing Director Saizel Ismail also shared the same sentiments that the local suppliers cannot meet demand and therefore they get authority to import from South Africa if they fail to meet demand.


“Locals get authority from Poultry Association Board to import supplementary poultry meat from South Africa to complement the demand. All suppliers and buyers meet to discuss poultry decisions and authorise suppliers.”

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