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2011

Study By:TNS rms EAP.O. Box 7180Dar Es Salaam, Tanzania

Tanzania Dairy Survey Report

Tanzania Dairy Development Program

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ContentsINTRODUCTION...............................................................................................................................4

1.1 Background......................................................................................................................................41.2 Research Approach..........................................................................................................................5

Consumer Study..........................................................................................................................5Consumer Research Findings..............................................................................................................7

General beverage awareness and consumption behaviors:........................................................................7Beverage selection drivers...........................................................................................................................8General beverages consumption locations:................................................................................................9General beverages consumption occasions among adults:.........................................................................9General beverages consumption occasions among kids...........................................................................10Why beverages are consumed..................................................................................................................10Summary...................................................................................................................................................10

Satisfaction................................................................................................................................11Health........................................................................................................................................11Innovation.................................................................................................................................11

Dairy products-Awareness and usage...............................................................................................12Source of awareness.................................................................................................................................12Consumption occasions-adults..................................................................................................................13Consumption occasions-kids.....................................................................................................................14Perceived differences- Cheese, Butter, Ghee............................................................................................15Barriers to using certain milk products......................................................................................................15Perceived benefits of dairy products.........................................................................................................17Alternative dairy products.........................................................................................................................18Milk types- Awareness & Consumption Behavior......................................................................................18Milk consumption criteria.........................................................................................................................26Media consumption..................................................................................................................................29

Recommendations.............................................................................................................................31Processor Audit Survey.....................................................................................................................33

Introduction and Methodology.................................................................................................................33Processor Capacity Census........................................................................................................................33Processor and Cooling plant capacities.....................................................................................................34Product Mix...............................................................................................................................................37Packaging and labeling..............................................................................................................................39Quality Control Procedures.......................................................................................................................40

Market Audit Survey.........................................................................................................................40Introduction & Methodology....................................................................................................................40Market Overview (Volume and Value)......................................................................................................42

Conclusion and Recommendations...................................................................................................54General recommendation to the industry.................................................................................................54


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Table of Tables

Table 1 Consumption occasions-adults.............................................................................................13Table 2 Consumption occasions-kids................................................................................................14Table 3 Perceived differences- Cheese, Butter, Ghee.......................................................................15Table 4 Awareness of milk types & brands......................................................................................17Table 5 Different milk types satisfy different needs evident............................................................19Table 6 Powder vs. Liquid Milk : Needs satisfaction.......................................................................20Table 7 Key consumption drivers.....................................................................................................25Table 8 Current vs Recommended pricing........................................................................................27Table 9 Media consumption Dar es Salaam.....................................................................................27Table 10 Media consumption Arusha...............................................................................................28Table 11 Media consumption Musoma.............................................................................................28Table 12 Media consumption Mwanza.............................................................................................29Table 13 Processor found to be in operation during the fieldwork...................................................33Table 14 Processor and cooling plant claimed capacities in liters per day.......................................34Table 15 Indication of processors' future investment plans..............................................................35Table 16 Processors by scale and type of product...........................................................................36Table 17 Processors by scale and cheese type..................................................................................37Table 18 Product distribution systems..............................................................................................37Table 19 Sample distribution by channel (outlet type).....................................................................40Table 20 Sample distribution by regions..........................................................................................40

Table of Figures

Figure 1 Selection of criteria for product mix...................................................................................36Figure 2 Mode of communicating with customers...........................................................................38Figure 3 Packaging and Labeling......................................................................................................38Figure 4 Sales volume in 14 days (000) per outlet type....................................................................41Figure 5 Sales volume in 14 days per region....................................................................................41Figure 6 Sales value based on 14 days per region............................................................................43Figure 7 Sales value based on 14 days (000 TZ'sh)..........................................................................43Figure 8 Domestic versus imported products....................................................................................44Figure 9 Product distribution bt regions............................................................................................45Figure 10 Milk product distribution by regions................................................................................46


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INTRODUCTION

1.1 Background

Land O’ Lakes International Development is a division of Land O’ lakes inc. which is a United States based food and agricultural cooperative offering local cooperatives and agricultural supplies as well as business services. It implements humanitarian and economic development activities for donor agencies.

Land O’Lakes wants to facilitate a market driven business systems to generate economic growth, improve health and nutrition, and alleviate poverty. Land O’Lakes international development has assisted farmers, food processors, agribusiness, and cooperatives in more than 70 countries since 1981.Our approach links agricultural producers to input suppliers, to processors and to local, regional or export markets.

Currently Land O’Lakes manages projects in more than 25 countries worldwide and is the recipient of an award from the United States Department of Agriculture, USDA, to implement a Dairy Sector Development Program in Tanzania which is a 3 year Tanzania Food for Progress Program to improve Tanzania’s dairy industry competitiveness and its goal is to increase smallholder household income from the sale of quality milk.

TNS RMS on behalf ofLand O’Lakes Tanzania implemented a research into the Dairy market to understand how to improve the efficiency of dairy production, improve milk quality throughout the dairy value chain, and strengthen milk marketing systems from the retailer to consumer.

The project was carried out in the coastal region of Tanga, Northern Highlands ofKilimajaro&Arusha and Lake Victoria region in Mara milk shed regions. Land O’Lakes aim was to use the research findings in developing baseline data and program indicators that will guide project activities and beneficiary capacity building for the next three years.

The results from the survey are to enable Land O’lakes to:

Develop milk production and collection systems Increase market linkages Improve Supply of Key inputs Strengthen dairy processing, quality assurance and link processors to new markets Enhance consumer awareness


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1.2 Research Approach

TNS RMS implemented this research in three stages listed below so as to answer all the objectives of the study; this study was done through consumer research and trade (retail) research methodologies. The consumer part of the study was conducted through a Qualitative methodology while the trade component was done through a retail audit methodology.

I. Consumer StudyII. Processor Audit Survey

III. Market audit Survey

Consumer Study

A. IntroductionThe consumer study was conducted through qualitative focus group discussions across Dar es Salaam, Arusha, Musoma&Mwanza regions. Consumer focus group discussions (FGDs) technique within qualitative research was used to be gain a better understanding of the consumers. The consumers are preselected from available demographic groups to constitute a homogeneous group of between 8 to 10 respondents. The demographic specifications that were used for this study took into account the following;

Age Gender Usage of products (brands, types, frequency etc) Profession Social class Location or area of habitation

The selected respondents were invited to a central location, in this case a centrally located venue for easy access for the respondents. The pre selection exercise is based on a set down criteria based on consumer usage, perceptions, opinions, beliefs and attitudes towards dairy products. The discussions are then held in an interactive manner within the group setting where participants are free to discuss freely with other group members. The focus group is the unit of analysis for the qualitative research methodology. The views, opinions and beliefs of the consumer group are taken as representative of the wider group in society. For instance, the opinions of the youthful women aged 18 to 24 years old and living in urban centres are taken as representative of all youthful urban females in Tanzania. However, in the sub analysis, we are able to distinguish between the different regions in the Tanzanian market.The FGDs provide a creative, interactive forum which enable participants to explore their actions and decision making processes, al beit consciously although the in a normal or natural market setting, there is no rationalization of decisions or decision making processes. To mitigate these potential areas of bias, we sieve out information taking into account the spontaneous versus the prompted responses within the FGD. We equally made use of expert qualitative moderators who study various aspects of human behaviour where they take into account the gestures, body language and weight of responses attributed to specific questions.


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The FGDs are normally aided by using a 'topic guide’ normally referred to as a discussion guide. This outlines the basic structure of the interview/group and indicates the general direction in which the interview/group should be led. However, the discussion guide is only a guide which is able to be used in a flexible manner during the discussion. The moderator is at liberty to explore the key issues arising even if they are not in the actual guide. The discussion guide questions are of open ended nature to allow for more exploration and in- depth probing/ laddering to uncover underlying beliefs, traditions and perceptions. Laddering explores the innate consumer needs, motivations and values linked to a product’s functional performance and benefits, and can be linked to Maslow’s Hierarchy of Needs to provide supplementary understanding on the strengths, vulnerabilities and symbiosis of brand affinity and performance.

B. Sample

In total 9 focus group discussions were conducted with the various demographic profiles. We talked to shoppers, decision makers, consumers and decision influencers for dairy products purchases. The demographics were as follow:

ArushaChristian

C1C225-35 years

Female with childrenCATEGORY: MILK

MuslimC1C2

25-35 YearsMale with childrenCATEGORY: MILK

MusomaChristian

C1C225-35 years

Male with ChildrenCATEGORY: MILK

MuslimC1C2

25-35 yearsFemale with Children

CATEGORY: MILK

MwanzaMuslim

C1C225-35 years

Female with ChildrenCATEGORY: MILK

ChristianC1C2


CATEGORY: MILKDar es Salaam

ChristianAB

25-35 yearsFemale & single

CATEGORY: DAIRY PRODUCTS

HinduAB


CATEGORY: DAIRY PRODUCTS

MuslimC1C2

25-35 yearsFemale & SingleCATEGORY:MILK


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C. Consumer Research objectives

The following are the research objectives: Understand who the dairy products consumer is (Who, what they drink, how, why) Provide consumer knowledge of dairy products and source of awareness Provide insight as to dairy consumer product preferences and preference drivers Give details of consumer understanding of nutritional benefits from dairy products Provide consumer concerns on hygiene and food quality of dairy products Give a consumer price sensitivity measure Identify traditional and religious association to dairy products (negative or positive) Identify barriers to consumption and unmet needs, thereby; Identify new product opportunities Distribution opportunities for dairy products

Consumer Research Findings

General beverage awareness and consumption behaviors:Consumers are aware of quite a number of beverages which include; Water, Carbonated soft drinks (sodas and cordials), Juices (juice concentrates and fresh juices), Dairy products (tea or coffee, yoghurt and milk) and food drinks (porridge and soup.) They claim to derive different nutritional benefits from these drinks:

DRINK NUTRITIONAL BENEFITWater and Carbonated soft drinks (cordials and sodas)

Sugar, Thirst quenching, Detoxification (Water specific)

Juices (concentrates and fresh juices) Juice and thirst quenchingDairy products (Tea/coffee, yoghurt and milk)

Wholesome and Nutritious

Food drinks (Porridge, soup) Chunky, Thick, Stomach filling

It is interesting to note that the popularity of Malta Guinness across the board does not necessarily play within the above categories, as it is considered more of a pastime drink, alongside other alcoholic beverages. A few mention energy drinks (Red Bull) predominantly as a source of energy.

Soft drinks are perceived as a very broad category whilst dairy products are acceptable as both a social as well as an individual drink. Soft drinks are considered extensively indulgent drinks which are consumed both as social and individual drinks whereas juices are regarded as both social and basic regulation drinks. On the other hand water and dairy products which are considered egocentric drinks are also seen as basic regulations products. However, consumption of the soft drink category is being driven by the emergence of new needs i.e. nutrition and energy.

Emerging products with a variety of flavours such as iced tea, fruit drinks for kids and dairy products are constantly distinguishing themselves and in the process making standard Carbonated soft drinks appear less exciting.


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Water is increasingly becoming an important player as a health product seen as a basic regulation and an individualistic product with purifying effects. However, mineral water is considered a more indulgence drink compared to plain/boiled water and also is believed to be a healthier alternative for carbonated soft drinks.

Milk is still seen as basic regulation drinks due to a lack of value added products in the market hence no clear products is positioned on these spaces.Whereas milk is seen as a universal product (‘for everyone’), the packaging distinguishes perceived users. Generally tetra brick packs are seen as “for the rich” while tetra classic packs and pouches for the ordinary consumers

Value added dairy products are becoming better differentiated in segments and are creating a competitive set for fresh & milk products. Dairy products such as Yoghurt and Mala are becoming more indulgent drinks because of the flavor additions which drive consumption. On the other hand milk products like tea and other hot beverages are seen as social drinks and are considered the refreshing alternative for soft drinks. Fresh milk is perceived as a more nutritional and healthy drink and a basic regulation product.

Beverage selection drivers

The product selection process is largely contingent upon the need and the moment of the consumer. Some needs are considered to be direct drivers in the selection process while others are linked to moments.

The direct drivers in consumption of beverages are hinged on the different needs of the users. Carbonated soft drinks are seen as social drinks with value addition and are consumed because of their refreshing effect. Mineral water and fruit juices are seen as individualistic as well as basic regulation drinks and are selected for their purifying and health benefits. Nutrition & Health benefits are the key pushers for dairy products selection to consumers. They believe that dairy products give them vitamins and minerals that are essential for their health. Milk is perceived as mainly a morning product and is used mostly as a mixture for other beverages & foods which include tea, coffee, porridge, cereals and other hot beverages. The usage of Milk in household is by the whole family but most families with young children will buy much more milk for feeding the children.

Needs that are direct drivers can be for purifying, refreshment and health purposes whereas needs that are linked to moments canbe because of indulgence, nutrition and energy. Needs associated with moments are either in between moments, support atmosphere of some moments or considered when having meals. This may overlap to a certain extent, but the moments are still regarded as different since their influence on the decision process is distinguishing.

Owing to their active and independent nature, kids are inclined to consume products that are seen to posses some value. These drinks are characterised as egocentric but can also be consumed socially in birthday parties and also in other children’s gatherings. Kids use milk as a way to refresh themselves, to have fun and as an indulgence in some cases. Some mothers are known to prevail upon their kids to consume milk because of its nutritional and health benefits.


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Milk is also served to guests at home ostensibly because it is either their preferred drink or because one simply wants to be a good host. Generally tetra brick packs are seen as “for the rich” while tetra classic packs and pouches for the ordinary consumers.

Life stage also plays a big role in influencing decision on product choice. The pre-family couple will tend to experiment on various drinks for health benefits or as an indulgence. On the other hand a family with kids would be inclined to consume high volumes of products of acceptable standards e.g. CSDs. Elderly couples living alone lean towards consumption of mature flavoured products like juices (fruit or fresh) more from routine than anything else.

Moments play a very important role in the selection process as they determine when and which products are to be consumed. Value added dairy products are consumed as an indulgence or after sports or on an outdoor activity. Other products with value addition are consumed in social gatherings like parties which are characterized with happiness and cheerfulness.Some drinks are consumed at breakfast, lunch or dinner as a matter of discipline and rule.

General beverages consumption locations:Although beverages can be consumed virtually anywhere, they are frequently consumed in the following places;

In the gyms or outdoors the beverages mostly consumed are water and energy drinks. When on an outing or social gathering, the preferred beverages include alcohols, energy

drinks, sodas, water and milk based drinks. In eateries (cafes, restaurants) beverages consumed include Water, sodas, tea and coffee. In the office beverages consumed include tea and other milk based drinks. At home beverages consumed include milk or chocolate based drinks, porridge, juices,

water, tea and coffee In schools milk and chocolate based drinks are commonly used. Juices and water are drank anywhere any time.

General beverages consumption occasions among adults:Beverages can be consumed at any given time but the following occasions represents when the consumption of beverages is considered high;

When Travelling, Water, yoghurt, juices and sodas are consumed When exercising and sporting, Water and energy drinks are drank When in a social meeting alcohol and coffee are preferred. On Lunch break as filler, yoghurt is consumed. When reveling or clubbing sodas and alcohol are the chosen drinks. In social gatherings alcohol, hot beverages and soda are consumed. At breakfast tea, coffee, milk and chocolate based drinks and juices are the preferred drinks. When having meals consumer s drink Juices After meals (night time or before bed) milk and hot beverages are consumed Water, tea and juices are consumed at any time of the day


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General beverages consumption occasions among kidsConsumption occasions among the kids are represented below;

When having meals or after meals they consume water Water and juices can be consumed at given anytime In the afternoon sodas are the preferred drinks In social gatherings they take tea, sodas, juices and yoghurt At breakfast they mainly drink tea, milk and chocolate based drinks After lunch and during holidays kids consume milk and chocolate based drinks At break time children love yoghurt and juices In the morning they take porridge and juices After meals (night time for non bed wetter's) milk, chocolate based drinks and yoghurt are

consumed mostly In mid-afternoon they prefer tea but consume milk, chocolate based drinks and tea after

school

Why beverages are consumedBeverages are consumed for various reasons by different people. The following depicts why beverages are consumed;

To derive energy and the drinks consumed include energy drinks, tea, porridge and cocoa and chocolate based drinks

To get a kick they consume energy drinks and alcohol To quench thirst, soda, juices and water are the preferred drinks For warmth, coffee, tea and cocoa and chocolate based drinks are consumed For stimulation they take coffee As a nutritional drink the preferred drinks are tea, porridge and cocoa and chocolate based

drinks For sweetness consumers prefer tea, cocoa and chocolate based drinks and juices For mildness they consume cocoa and chocolate based drinks For religious reasons they take cocoa and chocolate based drinks To aid their digestion, they prefer tea For an easy and quick to prepare they choose cocoa and chocolate based drinks For sustenance in absence of lunch they prefer tea, cocoa and chocolate based drinks


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SummaryConsumption of beverages is driven principally by the desire for refreshment and nutrition; these attributes are judged along a continuum of what quality they offer or do not offer. These considerations seem to occupy the pre-consumption moment which may suggest that intrinsic product attributes are the first step in the purchase decision-making process. On closer scrutiny of beverages and their accompaniments, varying attitudinal dispositions towards beverages and consumer desires from them become evident. This can be used to segment consumers as follows:

Satisfaction Driven Health Driven Innovation Driven

Low SEC Higher SEC

SatisfactionThe low end consumers’ priority is the sustenance the products offer and the key consideration is mainly for physical satisfaction. This implies that the drinks need to be chunky or thick to complete the filling effect. These products are considered around the clock drinks meaning they can be consumed in any of the following occasions:

Products consumed early in the morning are primarily hot beverages or porridge In mid-morning hot beverages and bread becomes the preferential drinks In the evening or at bedtimeconsumers take hot beverages or soup

HealthThis category of consumers (middle class) is pushed more by the health benefits (balanced meal) offered by the products. They seem to adopt the attitude that traditional home cooking is best and balanced diet is good which imply that these drinks contain various healthy ingredients. The opportunity here is that these drinks comprising of different food groups are seen as around the clock drinks i.e. and can be consumed:

Early morning consumers drink tea with bread and butter or eggs In mid-morning they consume whole fruits or Fresh (real) fruit juice Tea or chocolate base drinks with biscuits or mandazis consumed in the afternoon In the evening or bedtime they take water, Juice or milk

InnovationThe higher end consumers are driven essentially by innovation which is seen as a modern way of living. As much as they embrace new ideas and move with the changing times they are usually busy and short of time and constantly on the move hence the need for convenience. The implication here is that the novel packaging for these products should reflect status, modernity and convenience. They are seen as around the clock drinks and can be consumed:

At Breakfast, the preferred drinks are cereal plus strong coffee or tea In mid-morning they consume tea or coffee and snack In the afternoon they like consuming fruit salad or juice or yoghurt Evening/ Bedtime – Take away with soft drink, hot drink after


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Drinks that ‘overlap’ with foods (dairy / grain based) are taken as a snack to bridge a gap between meals and give energy until the next meal. They are also considered as a combination with bread or porridge to make a cheap or convenient meal.

Refreshment is top of mind when consumers talk about drinks, but thicker drinks are used as an ‘in-between’ to get to the next meal e.g. milk, yoghurt. Fruit based drinks are used as a source of healthy nutrition e.g. freshly squeezed juice.

Drinks are sometimes seen to provide more ‘efficient’ sources of nutrition. One glass of orange juice for example contains more juice (& therefore nutrition), is more convenient and seen as a modern format and easier to absorb than an orange.

Since refreshment is a key consideration, the format of the drink (whether hot or cold) is determined mainly by the existing weather condition at the time. Morning drinks are usually hot to fight the morning cold, afternoon drinks are mainly cold to cool the body, etc. Among the kids, taste concerns largely drive their preference of beverages as they tend to gravitate to tastier and sweeter drinks. Adults on the other hand are the nutrition watch- dogs who ensure that while refreshment is addressed, so is the nutritional element.

Dairy products-Awareness and usageConsumer are aware of various dairy products which include butter, Cakes, Chocolates, Ghee, Milk, Biscuits, Cream, Cheese, Mayonnaise, Yoghurt and Ice cream. It is understood that other products such as cakes, biscuits and chocolate would constitute elements of milk or dairy products in their preparation or manufacture. Evidently, there are misconceptions around dairy products such as use of milk in the manufacture of mayonnaise.

Source of awarenessConsumers get information about dairy products from different sources which are enumerated below;

Television (e.g. Cow bell) Retail outlets- Supermarkets and shops Promotional activities Posters Word of mouth (shopkeepers, friends; doctor’s recommendations- infant powder milk) Tradition or heritage (particularly for fresh milk products)

“…. I came to know about S26 when I gave birth to my last born through caesarian. The drugs they gave me dried up my milk and so I couldn’t breast feed and the doctor recommended I try S26”Female with children, 25-35yrs, Muslim, Musoma

“… Mostly Cow bell is advertised on TV …. I’ve seen it in between some kids program…” Female with children, 25-35yrs, Christian, Arusha

“…We have been using fresh milk from the cow and ‘mtindi’ since childhood …..” Male with children, 25- 35yrs, Muslim, Arusha


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Consumption occasions-adults

Table 1 Consumption occasions-adultsPRODUCT WHERE WHEN WHY WITH WHOM

Home Morning (mainly)Evening

HealthyGives energyBoosts immunity

Family

Cheese

HomeOffice

Morning (mainly)AfternoonEvening

Acts as an appetizerHealthyGives energy

Family

Home MorningAfternoonEvening

Gives energyCalciumBoosts immunity

Family

HomeOffice

Morning (mainly)AfternoonEvening

Palatable FillingNutritious

FamilyFriends/ colleagues

Ice cream

Outdoors Home

Afternoon (mainly)Evening

PalatableFilling

FamilyFriends/ colleagues

Of the 5 key dairy products predominantly mentioned (Cheese, butter, ghee, yoghurt and ice cream), only yoghurt and ice- cream are consumed as they are. Interestingly, both ice cream and yoghurt are predominantly consumed outdoors. Both would be used occasionally to top up salads. However, this is not commonplace and is observed mostly in Asian households.Butter is used essentially as an application (e.g. on bread) or ingredient in the preparation of other foods (e.g. porridge, spaghetti or pasta). As with butter, cheese is used to augment other foods like sandwiches, burgers, pizza, chapati and in some cases, salads. Cheese is seen as an expensive product by most across the board and is therefore used sparingly.

Ghee is predominantly used as cooking oil that can be used in the preparation of most meals that require frying. It is also applied on roasted or cooked bananas or used in the preparation of other meals such as porridge, spaghetti

Kids consume different dairy products for various reasons depending on the occasions;


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Consumption occasions-kids

Table 2 Consumption occasions-kids

Occasion Dairy product Reason

Morning

Milk Wholesome to start the day and provide warmth. To be accompanied by BUTTER (on bread)

Afternoon/ Lunch

Yoghurt Portability of (manufactured) yoghurt and its nutritious and filling nature makes it ideal for kids

Evening

Cheese Enriches nutritional benefits in food and increases palatability

Evening

Milk Wholesome

Special occasions

Ice creamYoghurt

Considered fun products/ sweet


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Perceived differences- Cheese, Butter, GheeAlthough these products appear to have the same inherent characteristics, consumers are able to decipher some recognizable differencesTable 3 Perceived differences- Cheese, Butter, Ghee

Cheese Butter Ghee Density

Cholesterol levels Taste Less milky- Salty;

sour More milky Difficult to tell as it is mixed in

food Fortification Fortified Fortified NOT fortified Brands used Tanga Fresh (Asians)

Craft (Asians)Kerigold (Asians)KCC (Asians)Anchor (Asians)Azam (Asians)Zanzibar (Asians)Unknown- identified by colour of pack (Xtians)Blue and cream packPinkish pack

KCCAnchorSuper GheeLuna ghee (Asians)Sukuma Land (Asians)Dairy Whole Butter (Asians)Aseel

Barriers to using certain milk productsGenerally, dairy products with high cholesterol levels are avoided across the board. Other factors that would inhibit use or consumption of a particular product include:

Reactions to product use such as allergies and disease e.g. Diarrhoea Availability of products Pricing which should be affordable Packaging or hygiene concerns

Nonetheless, no dairy product is singled out as one that would not be given to children as all are perceived to offer health/ nutrition benefits which make them all permissible. However, it is essential to mothers that the children’s consumption is monitored particularly with regard to dairy products that are high in fat content e.g. ghee. Irrespective of age, over- indulgence/ use of any dairy product is perceived to have negative results- fattening. In addition, as consumption occasions are also influenced by climatic conditions, some dairy products, ice cream in particular, is not given to kids during the cold season.

‘’..They are all useful and good for children….maybe it is just to reduce their amount of consumption. But for something like ice cream, we will not give our kids during the cold season as they may catch disease..’’Female & single, 25-35yrs, Christian, Dar ‘’..We don’t stop our children from eating any of these when they want…. They are all healthy. I however limit the use of ghee in food due to its high fat content.. .’’Female with children, 25-35yrs, Hindu, Dar


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Perceived benefits of dairy products

Butter, Ghee and Cheese are consumed because of some perceived benefits which largely cut across the three products. These benefits include:

Strengthening of bones due to calcium content. Replenishing of lost energy and particularly good for nursing mothers Boosting of immunity because of vitamins D & A Making the skin supple or smooth Increasing brain- power which is seen to make kids more intelligent Enhancing growth in children

Strengthening of bones due to Calcium content Replenishing lost energy and particularly good for nursing mothers Boosting immunity because of vitamins D & A Making the skin supple or smooth An appetizer or Ideal for pizza preparation due to its viscosity

Strengthening bones due to Calcium content Replenishing lost energy and particularly good for nursing mothers Boosting immunity because of has vitamins D & A Making the skin supple/ smooth

Given that there are essentially no distinct attributes across the 3 dairy products, it is likely that their usage would predominantly be driven by functional drivers such as cost or affordability &palatability.


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Alternative dairy productsWith the exception of ghee, both (molten) Cheese and Butter can be used interchangeably as spreads e.g. on bread. Ghee only occupies the ‘aid in food preparation’ space and may therefore not be a direct substitute to either Butter or Cheese.

In the absence of their regular brand, brand switching within the SAME category is also preferred. In the absence of an alternative within the brand category, most claim they would switch across formats e.g. powder to liquid milk and vice versa. Naturally, brand switching within the same category would be more prevalent.

Milk types- Awareness & Consumption Behaviori. Awareness of milk types & brands

Spontaneous awareness of milk can be compartmentalized in to two groups i.e. Liquid and powder milk. Liquid milk can be further divided into three categories which encompass liquid processed milk, liquid long life milk and fermented milk.

Table 4 Awareness of milk types & brandsLIQUID MILK POWDER MILKLiquid Processed milkDairy MilkOga Fresh Tanga FreshTuzoMara Fresh MilkSuper Milk (Dar ASIANS)Azam

Liquid long life UHTLiquid Fermented milk (Mala)Mara MilkLiquid unprocessed milkFresh from cowGoat milk

Powder- NIDOCow bellUnbranded Baby formulaLactogenS26

Fermented milk Yoghurt- Interestingly, many consider yoghurt to be a type of milk

Evidently, most consumers are unable to distinguish between the different milk types. Very few make reference to long life milk while none make reference to whole vs. low fat liquid milk or full cream vs. skimmed milk within the powder category. The key identifiable differentiators observed are based on FORMAT and PROCESSING of milk. Further, awareness of added value milk products is nil.

ii. Milk consumption occasions Consumption of milk is very high at breakfast in the morning but reduces as the day progresses. In mid-morning, milk consumption is considered moderately high but comparatively low at lunch.Inmid afternoon milk consumption is high and drops to comparatively low at dinner or evening time but climbs to moderately high at night before bed time. Milk is also consumed on special occasions like picnics and outings but the consumption is rather low

‘’..All in my family drink milk in the morning evening and around 11 o’clock after work or school ...’’Female with children, 25-35yrs, Muslim, Mwanza


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The most frequent occasion for both adults and children is at breakfast in the morning. Children frequently take milk as a mid-morning snack and as a mid-afternoon snack especially after school. In the evening the consumption frequency lessens slightly for both children and adults compared to breakfast and reduces further on special occasions (picnic and outings)

Consumption occasions do NOT vary by the type or format of milk. Accordingly, milk or milk based beverages are generally considered an ‘anytime’ drink. This however largely depends on affordability of the milk and disposable income.

iii. Milk consumption occasions-why

Milk is consumed by all members of the family due to its perceived health and therapeutic benefit. Expectedly it is largely consumed by children, followed by mothers who consume large quantities of pure milk as well as milk based beverages. Fathers consume milk mainly as mixers or to take advantage of the health benefits. However, the following reasons represents when milk is consumed by different members in a household;

Milk is consumed at breakfast by both adults and children Children take milk when having a morning snack. At lunch, milk is consumed by both mothers and Children When having an afternoon snack children drink milk Adults and Children take milk at dinner or evening At night and before bed adults and Children drink milk It is also an interesting consumption on special occasions (picnic, outings) taken by mother

and most children

‘’..Milk has no regular time table, I use it anytime I want..’’Female with children25-35yrs, Arusha

‘’..Milk is usually used in the morning because when you are making breakfast, you have to use milk and also when making the baby’s meals which is done in the morning. When you want to take tea, you have to use milk..’’Male with children, 25- 35yrs, Christian, Musoma

‘’..We take milk mostly in the mornings and in the evenings. In the morning, I give it to my child for breakfast before she goes to school but the younger one doesn’t like plain milk so I mix it in her porridge. We also take a glass after dinner before going to bed ...’’


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iv. Different milk types satisfy different needs evident

Table 5 Different milk types satisfy different needs evidentPowder milk Liquid Milk Infant Milk Powder Yoghurt/ FermentedReplenishing (esp. when breaking the fast)

Replenishing (esp. when breaking the fast)

Sweetness Sweetness Sweetness Sweetness

Relaxes Relaxes Relaxes

Warming (mixed with hot water)

Warming (when hot) Warming (mixed with hot water)

Filling Filling Filling

Accompanying food Accompanying food Accompanying food

Refreshing Refreshing (when cold)

Refreshing

Medicinal / Healing (ulcers, coughs)

Medicinal / Healing (ulcers, coughs)

Makes body fit Makes body fit

Body cleaning / removes toxins/ removes dust

Body cleaning / removes toxins/ removes dust

Powder milk is considered sweeter than fresh milk whilst the latter is seen as a more filling and refreshing product than any other type of milk.


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v. Powder vs. Liquid Milk: Needs satisfaction

Powder milk and liquid milk are seen to satisfy different needs but some needs are met better by different milk types.

Table 6 Powder vs. Liquid Milk : Needs satisfactionPowder Milk Liquid Milk Needs fulfilled comparatively better by milk type

(powder vs. liquid)Physical development / growth / strengthens bones

Physical development / growth/strengthens bones

Liquid milk, having originated from an animal is perceived to have an edge in possessing physical development / growth benefits such as strengthening of bones. It is perceived as more natural and therefore more nutritious

Image/ Prestige Milk powder is considered prestigious (NIDO). Pricing and packaging may contribute to these sentiments

Satisfying a taste experience

Satisfying a taste experience

Milk powder is perceived to be more palatable. ‘Cow milk’ in particular has a distinct taste which is unique

Satisfying a mouth feel experience (when not mixed with water!)

Liquid milk is thicker and creamier (contains more fat) / creamier than powder milk

Easy to prepare / easy to mix & dissolve (convenience!)

Time consuming (long boiling when unprocessed

Economical/ value for money

Direct comparison on quantities used reveals that one uses less powder per serving as compared to liquid milk

Sweetness Sweetness Powder milk is perceived to have enhanced sweetness over liquid milk

Filling Filling Liquid milk, is natural; it is considered to be thicker than powder milk hence more filling

Refreshing (when cold)

Refreshing (when cold)

Milk powder does not play in the cold beverage consumption space

vi. Barriers to using certain milk typesThis can be grouped among the different milk categories:

a. Among liquid processed & powder milk users;Fresh unprocessed milk It gives (children) diarrhoea / tummy problems It has too many worms It goes off (bad) very fast It requires high levels of hygiene / too risky


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Producers / sellers dilute it by adding water to it It is tampered with/ Diluted by sellers It is not readily available It is too time consuming to boil it up (in the morning)

b. Among liquid milk users;Milk powder It is considered too expensive It has bad publicity historical - concerns over quality of powder milk in tin cans.

Nido in particular It is considered to make children retch (throw up)

c. Among powder milk users;Fermented milk

It is not readily available It requires long boiling to kill the germs Fermentation is not ideal for kids’ digestive systems

Fresh processed milk It produces an unpleasant smell from pack It contains chemicals It is too diluted

vii. Preferred milk type

While many consumers have their misgivings towards fresh unprocessed milk, it still remains the most preferred milk type which has the following benefits;

Affordability- It is considered comparatively cheaper than processed milk types Nutrition orhealth drink – It is seen as the most nutritious, particularly for growing children. Availability - It is comparatively readily available , particularly in peri- urban areas Natural- It is ‘unadulterated’ as it contains no preservatives or other chemicals unlike

processed milk types

Interestingly, key demerits surrounding unprocessed milk are centered around its handling rather than its intrinsic attributes. These are;

Hygiene degradation by handlers along the value chain Dilution using water by unscrupulous dealers (hawkers or traders)

viii. Awareness of vitamins & minerals in milk and impact of fortification onmilkVitamins and minerals are perceived to be the key benefits derived from milk consumption. Among the functions they play is boosting immunity of the body, aiding in food digestion and improving vision. Minerals are known to strengthen the bones. The Vitamins found in milk include A,B,C and D whilst some of the minerals found in milk are calcium, iron and potassium.


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ix. Understanding of fortification/ food enrichmentConsumers have varying understanding of fortification or food enrichment which is represented as follows;

Positive associations around fortification Negative associations around fortification

x. Positive associations around fortificationFortification is regarded as processing for preservation or making the product last longer and is done in pasteurised milk, powder milk and yoghurt. It is also perceived to be a balanced addition of selected constituents e.g. vitamins and minerals in a product to enhance the nutritional value. Having a variety of flavours is perceived by a few as part of product fortification

xi. Negative associations around fortificationFortification is considered by some as an addition of (harmful) chemicals in products and by others as un-proportional addition of elements leading to disease or allergies. A few people perceive it to be a change in taste.

There are evidently mixed reactions (almost a 50:50 split across the board) to whether fortification is good or not. Among those positively aligned to fortification, understand that fortification would not only increase preservation of products but would also supplement any deficiencies consumers may have of these elements. Nonetheless, caution is given that this is so long as the product constituents being added do not exceed the normal quantities required by the human body, thus the need for a balance.

Fears are rife that processors or manufacturers may be unable to ascertain the right proportions of supplementary elements, the risk of which is that increased intake of the nutrients, beyond the required proportions, will be harmful to the body. Boosted levels are perceived to give rise to diseases such as Cancer, Diabetes, Diarrhoea; allergic reactions; rise in cholesterol levels and change in taste

Accordingly, while believability of fortified milk is not in question, there are mixed reactions to whether fortification actually improves milk or not. Among those opposed to fortification, sentiments are rife that it may not necessarily improve milk if the additional components could lead to allergies or complications due to a concentration of that particularelement. Nonetheless, the perceived element of preservation/ longer shelf life of a fortified product is well received.


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Among those pro- fortifications, see it as an improvement to the product. Indeed, most claim that they are currently using fortified dairy products.

xii. Impact of fortification on milk:Across the board there is a feeling that fortification would positively affect taste/ flavour:

“..It might prove too strong for some people and might harm them, giving rise to diseases like Cancer or even develop allergies. I also think these additives will make your cholesterol level rise; so I better keep on using what I normally use..”Female& single, 25-35yrs, Christian, Dar

“..For all I know, it could be just a marketing device. When I eat rice, I know I'm getting my share of carbohydrates and maybe the only thing that I'm not doing is getting the recommended daily potion. So I don’t like that idea of fortifying foods with anything..”Female with children, 25-35yrs, Muslim, Mwanza

“..A fortified product means it has added value…so while it may cost more, it is better for the body in the long run..”Female with children, 25-35yrs, Hindu, Dar

“..In our homes may be we eat food which lack some nutrient and when we buy products which has been added with nutrients and minerals we compensate the deficiency..”Male with children, 25-35yrs, Muslim, Arusha

“..When you say it is fortified, it means that as that product went through the manufacturing process, some of the nutrients got lost or were removed and that is why you need to add it in again. So it is a good thing..”Male with children, 25-35yrs, Christian, Musoma

“..Fortification helps! There’s a fortified milk known as “Ensure” from the Arab countries it’s sold at about Tshs. 60,000/= per tin of 500gms. My grandfather was very sick and we were advised to buy it for him- after consuming this milk, he immediately got relief .I think a lot of vitamins and minerals are added in it..”Female& single, 25-35yrs, Christian, Dar

“..Fortification will make the dairy product more delicious and good smell as well as looking more attractive..”Female& single, 25-35yrs, Christian, Dar

“..The flavour might change to good or bad depending on the quantity added..”Female& single, 25-35yrs, Christian, Dar

“..The flavour will definitely be affected..”Female with children, 25-35yrs, Hindu, Dar


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xiii. Fortification as an influence on purchase decisionFortification may have a negative impact on purchase decision among the younger female demographic, citing cost as an impediment to purchase (despite the added value)

In contrast, the older demographic are more value- driven and would willingly purchase a fortified product over a similar one that has not been fortified, irrespective of the premium on the former

xiv. Hygiene- Concerns about food quality and food safety Three key elements come to the fore when exploring food quality and safety:

Observance of packaged products- Generally, packaged products connote high levels of hygiene in their handling

Close scrutiny of expiration of product- products with no expiration date are avoided as much as possible

TBS stamp of approval- this authenticates the product’s quality and safety

Unique to the Asian community, products containing gelatine and/ or lecithin are avoided as conscious consumption of these go against their religious beliefs

Nonetheless, there is no other record of other religious influences inhibiting the consumption/ usage of any dairy products. Bad publicity of powdered milk, specifically Nido is recounted by some, citing the influx of counterfeits as the core reason to its negative perception.

“..Sometimes price will limit people despite the fortification and enrichment of the product…. only what people know is a dairy product with the belief that the product has been made with milk…. The rest may be a hard sell..”Female& single, 25-35yrs, Christian, Dar

“..If the product is not packed nicely and covered properly, that to me means it is not hygienic and will make me not buy it at all..”Female& single, 25-35yrs, Christian, Dar

“..I always check for the TBS stamp if it is not there I won’t buy..”Female with children, 25-35yrs, Asian, Dar

“..Fresh milk straight from the cow needs a high level of hygiene so you don’t just buy from anywhere or anyone..”Female& single, 25-35yrs, Christian, Dar

“..There is gelatine and lecithin in some ghee which some of us don’t take due to religious reasons..”Female with children, 25-35yrs, Asian, Dar

“..Nido had the problems in the past 2 yrs by the presence of fakes in the market which affected people’s health. Most users stop using it; it was a very bad perception for Nido..’’Female & single, 25-35yrs, Christian, Dar


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Milk consumption criteria

i. Key consumption drivers It is evident from the table below that intrinsic attribute i.e. Taste &Smell are the focal consumption drivers. Others include Pricing, Availability, and Packaging. It is interesting to observe the low importance attached to branding

1. Taste & Smell: Given the sensitive nature of the product and the potential impact on peoples’ lives health), consumers look at the Taste and the smell as being key in the product category. In normal circumstances, milk is not expected to have any strong smell or off putting taste in its natural form.

2. Pricing is key in a market that consumers have limited resources to allocate for dietary needs of the household. In a country where subsistence agriculture is the mainstay of most households, it is important to underling the critical role pricing plays in the choice of products, and milk is one of these. In most urban Tanzania, bulk milk still thrives because of the affordability issue by many consumers.

3. Availability: This is also a critical consideration factor in choice of products in the milk category. These are mostly considered as fast perishable goods that must be consumed within a few hours of purchase. Distribution therefore forms a key part in marketing the category in order to erase the held perceptions about milk being fast perishable (although this may already be in the process of being addressed through cooling refrigeration)

4. Packaging: For most consumers in Tanzania, packaging is important as a choice factor for the milk product category. It is especially noticeable in regions along the coast (Dar essalaam) that packaging is key as it is perceived as a solution to conserving the products. There is high likelihood of milk products getting spoilt if at all they are not well packaged. For instance, there is high regard for UHT milk packaging as it tends to last longer in hotter environments like in Dar. In the absence of wide spread use of the ‘expensively’ perceived UHT type product packaging, consumers go for the reusable plastic packs, since they are able to use the packs for several purchases later, hence cutting costs.

Table 7 Key consumption driversDAR, Females singles, Xtians

DAR, Females with children, Asians

DAR, Females singles, Xtians

AR, Females with children, Xtians

AR, Males with children, Muslims

1. Quality (Taste/ Smell)

1. Pack size SKUs




2. Nutritional value

2. Pricing 2. Expiry date 2. Packaging 2. Nutritional value

3. Packaging 3. Nutritional value

3. Communication

3. Pricing 3. Packaging

4. Availability 4. Availability 4. Availability 4. Availability 4. Availability

5. Pricing 5. Pack format SKUs

5. Pricing 5. Communication

5. Pricing


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MUS, Males with children, Xtians

MUS, Females with children, Muslim

MZ, Females with children, Muslim

MZ, Females with children, Xtians





2. Pricing 2. Pricing 2. Pricing 2. Packaging

3. Availability 3. Pack size SKU 3. Expiry date 3. Pricing

4. Nutritional value 4. Availability 4. Availability 4. Expiry date

5. Packaging 5. Packaging 5. Packaging 5. Availability

ii. Key Consumption barriers High cholesterol levels The smell of ghee in particular is singled out by a few as unpleasant

A few respondents are unable to consume cheese or butter due to the high cholesterol content which leads to allergic reactions

Powdered milk in particular is deemed as comparatively more expensive than liquid milk

iii. Alternative milk products Across the board, consumption of fresh fruit juice is commonplace, with most households squeezing fresh fruit for their children to extract natural juice which is considered essential for vitamins. The higher SEC will also purchase packed fresh fruit juices. In the total absence of milk, then black tea/ coffee/ chocolate beverages & porridge would take the fore. Porridge is viewed as a substitute for a meal because of its filling ability. It also provides energy and can be an alternative food for babies.

iv. Milk pricing Current vs. Recommended pricing

A cross section of pricing for various milk and dairy products across the regions confirms that pricing of powdered milk and dairy products such as Cheese/Ghee/Butter are deemed too expensive. Liquid (processed and unprocessed) milk are seen as affordable and therefore fairly priced.

“..My brother does not like ghee completely just because of its smell .He always complaints that it has a bad smell but the rest of us are comfortable with it..”Female& single, 25-35yrs, Christian, Dar “..My mother can’t use butter or cheese because she is allergic to it..”Female& single, 25-35yrs, Christian, Dar

“..If I get money I’d like to use Nido” Female with children..’’25-35yrs, Christian, Arusha


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Table 8 Current vs Recommended pricingREGION DAIRY

PRODUCT Current pricing (TSHS.)

Remarks Recommended Pricing (TSHS.)

DAR Ghee (1/2kg) 12,000 Too expensive 6000Cheese (25grms) 2,500- 3,500 Too expensive 125-175Butter (500grms) 6,500 Too expensive 2500

ARUSHA UHT milk (1/2lt) 600- 700 Fair/ acceptable 500-600Nido (450grms) 3,500 Too expensive 2500Cow Bell(500grms)

3000 Too expensive 2000

Tanga Fresh (1/2lt

700 Fair/ acceptable 600

MUSOMA Packed milk (Not specified

350 Expensive 150-200

Yoghurt (Not specified)

1200 Too expensive 500-600

MWANZA Unprocessed MILK (1lt)

800 Fair/ acceptable 600-700

Fermented (Mala) Milk (1/2lt)

800 Fair/ acceptable 600-700

Media consumptioni. Dar es Salaam

Table 9 Media consumption Dar es SalaamTV(Everyday- Home

RADIO(Everyday- Home/ Office)

NEWSPAPERS (Less often)

MEMORABLE BILLBOARDS

ITV (Common) Clouds FM (Common Nipashe (Common) Airtel (Jangwani;Uvungo)

TBC (Common) TBC (Common) Mwananchi (Common)

TCC (Uvungo)

Channel 10 (Common Radio 1 (Common) The Guardian (Common)

Vodacom (Moroko)

Capital Capital FM (Common) Alasiri Tigo (Mwenge)Clouds TV Magic FM Majira Dairy Milk Bamaga)Star TV Radio Tumaini Udaku (Thu) CCM (Mikocheni) ATN Kifimbo FM Kiu (Thu) Colgate (Kariakoo)Al Jazeera Nipashe Coca Cola IBN Mwangaza Emirates (CBD)


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Radio has a unique accessibility advantage thanks to the advent of the mobile phone- today, almost all mobile phones have built- in radios. As such, access is unlimited, relative to other electronic media forms

ii. Arusha

Table 10 Media consumption ArushaTV(Everyday- Home




ITV (Common) Clouds FM (Common Nipashe (Common) Vodacom (CBD)TBC (Common) Radio 1 (Common) Mwananchi

(Common) Tigo (CBD)

Channel 10 (Common Capital FM Majira Airtel (CBD) E.A TV E.A Radio Ijumaa Coca Cola (CBD)Clouds TV Triple A AlasiriStar TV Radio Free Africa

(RFA) Mwanahalisi

ATN Safina FM Mwanaspoti (Males) Al Jazeera Nipashe LeteRaha (Females)

There is a proliferation of Billboards by mobile phone service providers as evidenced by their high visibility.

iii. Musoma

Table 11 Media consumption MusomaTV(Everyday- Home)




TBC (Common) Clouds FM (Common Nipashe (Common) AIDS Awareness (CBD)

ITV TBC (Common) Mwananchi (Common)

Tigo (CBD)

Star TV Victoria FM (Common)

Uwazi (Common) Zantel (CBD)

Radio 1 Mwanaspoti (Males) HakiyaElimu (Nyasho))

Radio Free Africa (RFA)

Ijumaa Salama condoms (Nyasho)

Udaku (Thu) MwanahalisiDaily News

There is clearly very low visibility of Dairy products in above the line media- specifically on outdoor material


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iv. Mwanza

Table 12 Media consumption MwanzaTV(Everyday- Home




TBC (Common) TBC (Common) N/A Vodacom (CBD) Star TV (Common) Clouds FM (Common) Zantel (Nyerere Rd))ITV Radio 1 (Common) Serengeti Beer

(Musoma Rd)Channel 10 Radio Free Africa

(RFA) Safari beer (Kenyatta Rd/ Airport Rd

BBC Coca Cola (Shinyanga)Cow Bell (Nata)General Tires (Ronald Ngala)

There is clearly very low visibility of Dairy products in above the line media- specifically on outdoor material


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Recommendations

Results from this study indicate a consideration path which begins at the perceptual level (the refreshment and nutritional properties of beverages.)

Since these two qualities impact directly on human wellbeing, consumption of dairy products or beverages cuts across age, gender, income, and geographic demarcations. However, attitudinal disposition towards the role and effect of beverage (upon consumption) influences the choice of what to take. This explains the decision between cold or hot, light or heavy, natural or processed, traditional or new, local or foreign brand.

These consumer dispositions may, to some extent, be indicators of socio-economic status with those with higher incomes being partial to healthy and ‘innovative’ drinks and those with less income being more inclined to beverages which satisfy hunger and ‘process’ other foods.

It would, therefore, be expected that products and brands which fulfil these expectations would appeal to these different segments.

However, the nutritional benefit of a beverage seems to have a greater impact on preference and recommendation to the extent that consumers are prepared to trade off beverage type, brand, pack size, and place of purchase.

Thus, even if the purchase decision-making process may begin at the intrinsic product attribute level, extrinsic properties provide opportunities to influence consumption. It follows, therefore, that milk based drinks would have to establish their nutritional credentials before leveraging price, place, and promotion.

The innovation platform appears to be the opportunity area for new product development i.e. Novelty in product attributes e.g. around packaging to reflect status, modernity and convenience. Innovations could also be in pack sizes & shapes, flavour, taste, and new uses e.g. pre-mixed cold drinks for the Innovation Driven.

Across the ‘Satisfaction- driven’ to the ‘Innovation- driven’ continuum, the need for products that provide health (including growth of kids) and nutrition is central. Health benefits that are already associated with food & nutrition (e.g. physiological) are most credible. Accordingly, new product opportunities may need to give impetus to 3 key pillars


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i. Strength for the momentThis would involve products which will not leave the consumer not feeling weak meaning having the strength to work or the sustenance which will require filling foods.

ii. Strength for the futureConsumers are invariably looking for products that have the ability to boost the bodily immune system or equip the body with the ammunition to help fight diseases and at the same time maintaining the strength.

iii. Strength of mindConsumers are seeking products that are seen to inject confidence, mental resolution and courage as well as the ability to perform optimally.

Other benefits that provoke interest, though with narrower or polarizing appeal include: Boosting the immune system is universally considered essential albeit being an extremely

contentious issue. Reduction of cholesterol, regarded as an issue for people who know they have a cholesterol

problem. Looking good or bulking up your body is seen as an outward show of health especially on

skin, eyes, body and shape. Coping with stress, concentration or sleep are potentially interesting benefits, but takes

nutrition into ‘drug’ or medication territory. However, this needs to be more closely linked to a ‘nutrition’ story to be considered healthy.

Finally, other consumer pointers which could add to the appeal or success of a new product within the dairy food or beverage product category include:

Quality – This is largely reflected in products and packaging and is increasingly important to consumers (hygiene, status, value.)

Nutrition Knowledge – It is deemed important for product / manufacturer to play a role in education & make product benefits easy to understand; make use of multiple communication channels.

Point of sale – The products should be made available at all times and in the chiller section to emphasize freshness.

Branding – The credibility of the brand as a nutritious product is key (e.g. Brookside in Kenya, Tanga Fresh in Tanzania are trusted brands which cue nutrition.)

Credibility – Nutrition is a hard benefit to prove & claims need to be built over time.Relevance – Tapping into the emotional, experiential & social context will drive consumer adoption & loyalty.

Source – Where it comes from and what it is made of needs to be clearly identifiable.Every day – Offering a ‘daily dose’ of nutrition to drive frequency.


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Processor Audit Survey

Introduction and MethodologyThe processor audit survey sought to identify large, medium and small processors in the project region and quantify their installed processing capacity. The audit was carried out in two phases; Phase one was a census enumerating all Dairy processors in Tanzania and collecting there contact information (name of processor, year established, region and contact information), a total of 28 processors were interviewed.In the second phase, we targeted processors in the Northern Regions of Tanzania (Tanga, Kilimanjaro, Arusha, Mara), where we administered a detailed questionnaire interviews, to understand other aspects like installed processor capacity, product lines and the market for their products. We clustered processors based on capacity as follows:

Large processors with batch pasteurization equipment and limited cold storage Small scale processors with batch pasteurization equipment and limited cold storage Cottage industry processor.

The objectives in the processor audit were

To identify large, medium and small scale processors and quantify processing capacity for processors in the project region (Tanga, Kilimanjaro, Arusha and Mara).

To establish the levels of utilized capacity at different times of the year and if there is an opportunity to increase processing capacity.

Identify where processors source raw milk whether from producer cooperatives or commercial farms.

To determine the products produced, packaging used (and source) and if their labels are professionally designed or done in-house by the processor.

Determine if respective processors have a laboratory and their claimed quality testing capacity.

Identify processor’s primary and secondary markets and if they distribute themselves or use distribution agents. Understand their route to markets.

Give processors’ operational background and understand if this is their primary business focus or a secondary investment.


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Processor Capacity Census

A total of 28 processors were found to be active with most of the processors being located in the Northern regions of the country that is Tanga, Mara, Arusha and Kilimanjaro where there is a deep attachment to livestock.The following is a table of processors that were found to be in operation during the fieldwork;

Table 13 Processor found to be in operation during the fieldwork

NAME OF PROCESSOR REGIONYEAR ESTABLISHED

INTERNATIONAL DAIRY PRODUCTS ARUSHA 1,994MOUNTAIN GREEN LTD ARUSHA 1,998ARUSHA DAIRY CO. LTD ARUSHA 2,005AGAPE WOMEN DAIRY CO-OPERATIVE SOCIETY ARUSHA 1,996KIJIMO WOMEN DAIRY CO-OPERATIVE SOCIETY ARUSHA 1,999NYALABE DAIRY CO-OPERATIVE SOCIETY ARUSHA 2,011LITI TENGERU ARUSHA 1,977PROFATE INVESTMENT LIMITED DAR ES SALAAM 2,007NEW NORTHERN CREAMERIES LTD ARUSHA 1,985CEFA NJOMBE MILK FACTORY IRINGA 1,999KALALI WOMEN DAIRY CO-OPERATIVE SOCIETY LTD KILIMANJARO 1,999KILIMANJARO CREAMERIES LTD KILIMANJARO 2,008NRONGA WOMEN DAIRY CO-OPERATIVE SOCIETY KILIMANJARO 1,996WEST KILIMANJARO DAIRY LTD KILIMANJARO 2,001FUKENI DAIRY KILIMANJARO 2,003MUSOMA DAIRY LTD MARA 1,976MARA MILK MARA 2,008VICTORIA MARA 2,009NYUKI DAIRY MARA 2,008BARAKI SISTERS FARM MARA 1,975MBEYA MILK MBEYA 2,000MATI-UYOLE MBEYA 1,965TAN DAIRIES DAR ES SALAAM 9,999IRENTE FARM TANGA 1,971TANGA FRESH LTD TANGA 1,997AMMY BROTHERS TANGA 2,001SHAMBANI GRADUATES ENTERPRISES MOROGORO 2,006


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Processor and Cooling plant capacitiesLarge processors (process over 10,000 liters per day) account for a mere 18% of the market and control about 80% of production output during peak season. Midsized processors (process between 5,000 – 10,000 liters per day) account for 11% of the market and control 17% of production capacity output during peak season. Small processors (process < 5000 liters per day) making up 71% of the market account for a mere 3% of production output during peak season. Overall there is huge gap between the installed capacity and the utilized capacity across most of the processors with an exception of Tanga Fresh Ltd whose installed capacity is 50,000 liters per day and fully utilizes whole of it. Those that have high installed capacity but the utilization was very low include; Agape Women Dairy Co-Operative Society utilizes only 4% of its processing capacity and Kijimo Women Dairy Co-Operative Society utilizing a mere 1% of its processing capacity (cite table No2.2). Most of the processors cited power failure and lack of enough milk from farmers as the two main reasons why there is underutilization of their maximum processing capacity. Bearing that milk processing is the core business for most processors; these represent a unique challenge as they don’t have any other side business.

Table 14 Processor and cooling plant claimed capacities in liters per day

NAME OF PROCESSOR REGION

InstalledCapacityin liters/ day

Utilized Capacity in litres/day

Cooling Capacity in litres /day

Collection Capacitylitres/day

INTERNATIONAL DAIRY PRODUCTS ARUSHA 10,000 700 1500 1500MOUNTAIN GREEN LTD ARUSHA 1500 350 350 350ARUSHA DAIRY CO. LTD ARUSHA 15,000 6,000 15,000 6,000AGAPE WOMEN DAIRY CO-OPERATIVE SOCIETY ARUSHA 200 200 100 200KIJIMO WOMEN DAIRY CO-OPERATIVE SOCIETY ARUSHA 1300 1300 500 500NYALABE DAIRY CO-OPERATIVE SOCIETY ARUSHA 3000 3000 2000 1,500LITI TENGERU ARUSHA 500 500 300 300

PROFATE INVESTMENT LIMITEDDAR ES SALAAM 1000 300 600 400

NEW NORTHERN CREAMERIES LTD ARUSHA 70000 3000 3000 3000NJOMBE MILK FACTORY IRINGA 2,000 200 200 200KALALI WOMEN DAIRY CO-OPERATIVE SOCIETY LTD KILIMANJARO 1,000 350 350 350KILIMANJARO CREAMERIES LTD KILIMANJARO 1,000 750 1,000 500NRONGA WOMEN DAIRY CO-OPERATIVE SOCIETY KILIMANJARO 1500 600 600 600WEST KILIMANJARO DAIRY LTD KILIMANJARO 700 400 400 400FUKENI DAIRY KILIMANJARO 1000 1000 1000 1000MUSOMA DAIRY LTD MARA 40000 7000 40000 10,000MARA MILK MARA 15000 6000 15000 6,000


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NAME OF PROCESSOR REGION

InstalledCapacityin liters/ day

Utilized Capacity in litres/day

Cooling Capacity in litres /day

Collection Capacitylitres/day

VICTORIA DAIRY MILK MARA 4000 500 4000 800NYUKI DAIRY MARA 1,300 1,300 500 500BARAKI SISTERS FARM MARA 3,000 3,000 2,000 1,500MBEYA MILK MBEYA 500 500 300 300MATI-UYOLE MBEYA 2,500 400 2,500 400

TAN DAIRIESDAR ES SALAAM 1,000 300 600 400

IRENTE FARM TANGA 60 60 60 60TANGA FRESH LTD TANGA 50,000 50,000 30,000 50,000AMMY BROTHERS TANGA 200 150 200 150SHAMBANI GRADUATES ENTERPRISES MOROGORO 4,500 1,500 4,500 3,000

Large processors were found to have higher collection and storage capacities and account for 65% of total storage capacity. There are smaller storage capacities as compared to plant processing capacity mainly because collection and storage of milk is a continuous process. Based on the gap between installed capacity and utilized capacity, it is an indicator of existing potential to increase milk production. Out of the 28 processors that were found to be in operational, 24 (84%) had less than 5 Milk Collection Centers, for the large processors about 40% had less than 5 collection centers with about 65% the medium scale and all small scale processors falling into the category with less than 5 collection centers.

Different processors are examining varied strategies to mitigate fluctuations in milk supply, in the next 2-5 years. This is either Processing plant, cooling plant, Research and Development (R&D), and Added value products. Noted was the fact that 22 out of 28processors would invest in Processing and cooling plants. Processors have plans to invest as indicated on the table below.

Table 15 Indication of processors' future investment plansNumber of processors (Base 28)

Average planned capacity growth

Processing Plant 22 38%Cooling plant 22 29%Added Value products 18 19%R&D 16 16%Export 11 6%

Ideally there is a big opportunity for the growth of milk processing and cooling as majority of processors felt that they need to increase their revenues. About 19% of processors also included values add products as a future investment venture.


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Product MixAn overall examination of total production 86% of the processors report to have sold all of their volume of production which is an indicator of an existing huge market demand but which is not being met by the current supply of processed milk and milk products. Most processors preferred a product mix of cultured milk and fresh pasteurized milk with 93% and 75% frequency mentions respectively.

Table 16 Processors by scale and type of product

Processor Type % Large Medium SmallBase Total 28 5 3 20Fresh Pasteurized milk (HSTS) 75% 40% 100% 80%UHT 4% 20% 0% 0%Yoghurt 64% 100% 67% 55%Cream 25% 40% 0% 25%Butter (tonnes) 50% 60% 67% 45%Ghee (tonnes) 54% 100% 100% 35%Cheese 50% 40% 67% 50%Cultured Milk 93% 100% 100% 90%

Amongst the processors that had cultured milk as one of their product mix 71% mentioned it as the biggest seller in terms of revenue and volumes. However there was 4% frequency mention of UHT as part of the preferred product mix, with main reason being high production cost. In terms of choosing product mix, there were many reasons fronted, however customer needs topped with 71%, closely followed by products that have several uses (e.g. fresh milk which can be taken raw, used with tea and /or mixed with other food/drinks).

Figure 1 Selection of criteria for product mix

Perishability of the goods

Easy distribution

Fast Moving goods

What is loved by the people

Can be used in many ways

Customer needs

0% 10% 20% 30% 40% 50% 60% 70% 80%

How did you select your product mix?

Base 28 processors


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The study found out that large-scale processors have a greater diversity of products followed by midsized processors. For instance 20% of large processors have UHT in their product mix whereas this is nonexistent in medium and small scale processors. It is interesting to note that 50% of processors had cheese in their product mix, and this tends to be skewed to small scale processors. Ten (10) out of 14 of the processors manufacture mozzarella and Gouda cheeses.

Table 17 Processors by scale and cheese typeProcessor Type

Base Total Large Medium Small Base Total 14 2 2 10Cheddar 5 1 1 3Gouda 9 1 2 6Mozzarella 10 2 1 7Camembert 1 0 0 1Cream Cheese 3 1 0 2Cociotta 1 0 0 1

Table 18 Product distribution systems Processor TypeMeans of distribution Base Total Large Medium SmallBase Total 28 5 3 20Refrigerated trucks 32% 100% 100% 5%Pick Ups 61% 40% 33% 70%Structured (i.e. agent, sub agent) 11% 20% 33% 5%Bicycle 11% 0% 33% 10%Bus 11% 20% 0% 10%Motorbike 14% 0% 33% 15%Retailers visiting the processors 4% 0% 0% 5%

The large and medium processors are using refrigerated trucks to deliver milk products whilemajority of small scale processors using pickups vans for distribution which are not refrigerated. Most of the processors directly deliver their products to the customers to increase the extent market penetration of the products to the regions.There was also high claim for the use of merchandising materials to gain visibility at retail levelSome of the other marketing activities mentioned included:

Directly distributing to the outlets Encouraging the small outlets to promote the products Participating in agricultural shows Using point of sale materials on the outlets Advertising the product through the radio

Figure 2 Mode of communicating with customers


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Billb

oard

s

e-m

arke

ting

Tele

visio

n

Prin

t med

ia (n

ews.

..

Radi

o

Wor

d of

mou

th

Mob

ile p

hone

0%

10%

20%

30%

40%

50%

60%

7% 7% 7% 11%18%

43%50%

Base 28 processors

Mobile phone was noted as the most commonly used form of marketing communication at 50% followed by word of mouth 43% and radio 18% .Traditional forms of advertising i.e. print-media, television, e- marketing and billboards are not largely used by processors because of their high costs. For instance currently only 11% use print media (newspapers/magazines).

Packaging and labelingA fair number of processors that participated in this market survey, 50% had never evolved their packaging because they felt it was still relevant and acceptable in the market, having been developed within a time frame of 2 to 5 years. It was apparent that the processors do not develop their labels and packaging but outsource the services, 79% of the processors had their labels and packaging done by an independent supplier while the remaining 21% had their packaging done in-house. It was also apparent that some of the processors (50%) have not changed the packaging and nor stock keeping units.

Figure 3 Packaging and Labeling

Never Every year Every 2 years Every 5 years0%

10%

20%

30%

40%

50%

60%

Change packag-ing

Change SKU

Base 28 processors


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Quality Control ProceduresMost of the processors surveyed conform to some of the basic milk quality standards. Basic quality tests were conducted at intake/collection of milk and during processing. In most of the collection points, basic hygienic and quality tests are conducted. Common platform tests conducted in most of the collection centers include;

1. Organoleptic tests2. Clot on boiling3. Alcohol test4. Lactometer test (density)

In some cases the all the four basic tests are not observed at once but organoleptic and alcohol test appeared to be the most practiced tests. With basic quality tests for the raw milk at the factory gates, some advanced quality checks are also observed for the delivered milk as well as for the products. Some of the common advanced quality tests include fat test, acidity and other microbial tests depending on the type of the product and available lab facility. Some of the processors, especially large and medium ones conduct quality checks testing routinely on the finished product or periodically along the process of manufacturing the product. Ideally quite number of processors has laboratories in the processing plants with technicians who are endowed with some basic knowledge on quality checks.

Along with internal quality control system, externally there are a number of regulators overseeing the quality issues in food industry that are largely aimed at ensuring quality and safety of the consumer. The regulators, among others include Tanzania Bureau of Standards (TBS) and Tanzania Food, Drug Authority (TFDA) which authorizes quality compliance in terms of premises, equipment/machinery, personnel and products.

i. Product Research & Development

All the large processors (> 10000liters per day) and medium processors (5,000-10,000 liters per day) claimed to undertake consumer market research before introducing their product mix, whereas only 55% of the small scale processors (< 5000 liters per day) have ever undertaken market research. Those who have never carried out any research (32%) site financial constraints as the major reason. It’s noted that even amongst the 68% of processors that undertook market research (79%) had the research done in-house as a means to mitigate on research costs. For those few who outsource research firms for their research work cited expertise as the main driver for outsourcing.

Market Audit Survey

Introduction & MethodologyThe market audit was carried out in the month of March/April-2011, in Tanga, Kilimanjaro, Manyara, Arusha and (DSM) Mara regions and a total of 1000 retail interviews were carried out


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across the different channel outlet types. The interviews were pen and paper and took an average of 45 minutes for outlets handling the products and 10 minutes for the non-handlers.Sampling was done randomly to have a total national representation during analysis. The channel outlets visited were Supermarkets, Convenient stores, Kiosks, Dukas, Hotel Restaurants and Cafeteria (HoReCa) and Fast food sampled as below:

Table 19 Sample distribution by channel (outlet type)Channel Outlet Type SampleSupermarket 18Mini Supermarket 31Petrol Convenient Store 29Large Duka 80Small Duka 381Horeca 119Fast Food 80Kiosk 262Total 1000

The regions visited during the survey were Tanga, Arusha, Mara, Manyara and Dar es Salaam with Dar having the highest number of outlets visited due to its high population density and also its contribution to the FMCG (Fast moving consumer goods) sector, including Dairy products.

Table 20 Sample distribution by regions

The overall objective of the market audit survey included: Get accurate sampling of product availability by type and size Product diversity Out of Stock problems Cold chain availability Identify product gaps and potential opportunities to increase distribution and product

diversity In the market audit, the interviewers visited the outlets to record available stock of the dairy products at the time of visit, pricing per unit, stock keeping unit together with brand name and main distributor. Estimation of sales was done by asking the respondent (Shop owner/Shop

Region SampleDar es Salaam 737Arusha 98Tanga 74Mara 49Manyara 42Total 1000


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assistant/ Shop manager) of how much he had sold in the last 30 days, in a fortnight and one past week. Observational data like POS (point of sale observation) and availability of cooling facility (Presence of refrigeration) in the outlets was also collected. This was done in relation to the existing brands in the outlet.

Market Overview (Volume and Value)

i. VolumePasteurized fresh milk command the largest market (44%), closely followed by UHT fresh (21%) a fortnight and the most important channel types that contributed to that were small Dukas (a non-permanent structure normally built on a non-trade dedicated area) and kiosks which in these context refers to a non-permanent structure normally built on a non-trade dedicated area. Cheese and butter were mostly being sold in mini markets and convenient store with a very small percentage of the volume in small dukas and this could be due to the low cooling presence.

Figure 4 Sales volume in 14 days (000) per outlet type

Total Outlets Fast Food HORECA Kiosk Large

DukasMini-Super-

marketPetrol Station

Small Dukas

Super- market

Butter 2.44 - - - - 0.24 0.67 0.41 1.13 Cheese 0.52 - - - - 0.39 0.09 - 0.03 Cream & Ghee 4.47 - 0.20 - 3.69 0.05 0.53 - - Cultured Milk 171.04 1.96 15.43 18.87 18.08 2.79 7.77 105.32 0.82 Ice Cream 20.35 8.30 1.18 0.49 0.32 0.54 4.78 4.04 0.69 Pasteurised Fresh 410.04 23.14 21.71 65.73 29.95 3.07 7.06 258.56 0.82 UHT Flavoured 36.32 0.52 0.90 2.11 2.08 1.33 2.94 26.13 0.31 UHT Fresh 202.01 4.69 10.34 30.73 21.84 7.54 7.61 116.86 2.41 Yoghurt 95.70 3.81 14.72 13.99 14.26 1.60 2.39 44.73 0.21

Sales - 14 Days (000s)

Kgs

Litres

At a regional level it is evident that Arusha/ Kilimanjaro and Dar es Salaam commanded the highest sales in a fortnight across all the milk products. 93% of pasteurized milk was sold in Dar es Salaam and Tanga and 50% of yoghurt being sold in Tanga. Most of the milk by products (butter and cheese) was being sold in Arusha/ Kilimanjaro and Dar es Salaam

Figure 5 Sales volume in 14 days per region


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Total Outlets Arusha/ Kilimanjaro Dar es Salaam Manyara Mara Tanga

Butter 2,438.25 233.33 2,202.91 - 2.00 - Cheese 515.35 392.00 121.35 - 2.00 - Cream & Ghee 4,469.25 3,690.00 778.75 - 0.50 - Cultured Milk 171,043.90 49,249.03 75,469.09 6,376.26 36,650.22 3,299.26 Ice Cream 20,347.20 4,152.42 15,916.09 - - 278.69 Pasteurised Fresh 410,039.31 2,044.95 247,451.71 7,844.34 16,809.38 135,888.90 UHT Flavoured 36,316.66 10,278.01 23,771.99 - 1,681.21 585.45 UHT Fresh 202,009.99 47,785.06 140,713.81 84.14 12,189.72 1,237.34 Yoghurt 95,702.37 2,699.44 11,304.85 - 33,800.49 47,897.61

Sales - 14 Days

Kgs

Litres

ii. ValueIn the total regions audited, the milk and added value products constitute of Tshs2.41 Billion every fortnight, which a larger contribution coming from pasteurized fresh milk and UHT Freshat 31%, followed by cultured milk (16%) .Butter and cheese had the lowest value shareand this could be due to the fact that very few processors have the capability of producing it.

Figure 2.5: Sales Value Shares based on 14 days sales1%1%

16%

7%

31%5%

30%

8%

Butter-KilogramCream & Ghee-LitreCultured Milk-LitreIce Cream-LitrePasteurised Fresh-LitreUHT Flavoured-LitreUHT Fresh-LitreYoghurt-Litre

Cultured milk, Pasteurized milk and UHT fresh which are the biggest revenue earners for most processors are being sold in Arusha/ Kilimanjaro and Dar es Salaam


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Figure 6 Sales value based on 14 days per region

Total Outlets Arusha/ Kilimanjaro Dar es Salaam Manyara Mara Tanga

Total Total Products 2,406,826 523,678 1,380,663 34,115 175,078 293,291 Butter 29,350 5,040 24,280 - 30 - Cheese 6,328 4,153 2,164 - 11 - Cream & Ghee 22,085 18,450 3,633 - 3 - Cultured Milk 395,872 169,041 161,639 12,803 47,145 5,244 Ice Cream 172,613 51,315 119,179 - - 2,118 Pasteurised Fresh 737,785 6,320 486,459 20,975 20,171 203,860 UHT Flavoured 114,012 31,360 76,466 - 4,915 1,271 UHT Fresh 733,232 226,856 470,519 337 32,809 2,712 Yoghurt 195,549 11,143 36,324 - 69,995 78,087

Sales Value (000's TZS)

Kgs

Litres

Small Duka is the most important channel moving 56.69% of the total products in a fortnight and this could be attributed to the availability of the channel in most of the regions and servicing a big percentage of the population who are the bottom of the pyramid and have no access to supermarkets and convenient stores.

Figure 7 Sales value based on 14 days (000 TZ'sh)

Total Outlets Fast Food HORECA Kiosk Large

DukasMini-Super-

marketPetrol Station

Small Dukas

Super- market

Total Total Products 2,406,826 132,361 152,523 296,035 226,215 65,161 132,903 1,364,486 37,141 Butter 29,350 - - - - 5,070 10,064 731 13,485 Cheese 6,328 - - - - 4,164 1,560 - 603 Cream & Ghee 22,085 - 357 - 18,450 242 3,036 - - Cultured Milk 395,872 4,164 34,075 34,724 38,557 5,840 17,939 258,337 2,238 Ice Cream 172,613 64,872 8,611 4,263 1,692 5,772 36,808 41,829 8,766 Pasteurised Fresh 737,785 35,577 37,817 122,593 58,154 9,202 15,910 456,190 2,342 UHT Flavoured 114,012 745 4,790 6,185 6,947 4,451 10,024 79,867 1,003 UHT Fresh 733,232 20,415 36,832 103,049 72,442 23,501 26,496 442,533 7,964

Sales Value (000's TZS)

Litres

Kgs


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iii. Domestic versus imported products

56.14% of the total dairy products found in the sample were being produced locally. UHT fresh white which moves a lot of volume and comes second with a significant 30.46% value share after pasteurized fresh milk, 98.98% of it is imported.

In the 1000 interviewed outlets there was no cream and ghee that was being produced locally and only a mere 0.10% of butter being manufactured locally this could be attributed to the high cost of production of the products with the facility being very expensive and also the power fluctuation problem that is being experienced in the country. Most of the cream & ghee and butter that were being imported were brought in from Kenya with New Kenya Cooperative creameries bringing in 87% of the total fortnight volume followed by Dairy Land limited at 7.5%.

Figure 8 Domestic versus imported products

All Domestic Imported Domestic Imported

Total Total Products 2,406,826 1,351,125 1,055,701 56.14% 43.86%Butter 29,350 30 29,320 0.10% 99.90%Cheese 6,328 3,733 2,595 59.00% 41.00%Cream & Ghee 22,085 - 22,085 0.00% 100.00%Cultured Milk 395,872 336,870 59,002 85.10% 14.90%Ice Cream 172,613 117,910 54,703 68.31% 31.69%Pasteurised Fresh 737,785 657,680 80,106 89.14% 10.86%UHT Flavoured 114,012 1,168 112,844 1.02% 98.98%UHT Fresh 733,232 59,034 674,198 8.05% 91.95%Yoghurt 195,549 174,699 20,849 89.34% 10.66%

Kgs

Litres

Sales Value (000's TZS) Sales Value %


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iv. Product Contribution by regionDar es Salaam, Manyara and Tanga are the regions that are moving a lot of Pasteurized fresh which has the highest volume and value share in the market. UHT fresh has the highest percentage in Arusha/ Kilimanjaro and Dar es Salaam and this could be attributed to the fact that quite a large percentage of the product is being imported and hence the distribution channels are not effective to reach the far end of Tanzania like Manyara and Tanga. Most of the milk by products (Yoghurt, Cheese, ghee and butter) have very low presence in all the regions

Figure 9 Product distribution bt regions

Arus

ha/K

ilim

anja

ro

Dar e

s Sal

aam

Man

yara

Mar

a

Tang

a

0%

10%

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70%

80%

90%

100%

0.2% 0.4% 0.0% 0.0% 0.0%0.3% 0.0% 0.0% 0.0% 0.0%

40.9%

14.6%

44.6%36.2%

1.7%

3.4%

3.1%

0.0%0.0%

0.1%

1.7%47.8%

54.8%

16.6%71.8%

8.5%

4.6%

0.0%

1.7%

0.3%39.6%27.2%

0.6%

12.1%

0.7%

2.2% 2.2% 0.0%

33.4%25.3%

Yoghurt-LitreUHT Fresh-LitreUHT Flavoured-LitrePasteurised Fresh-LitreIce Cream-LitreCultured Milk-LitreCheese-KilogramButter-Kilogram

Looking at the distribution by products we notice that most of the milk by products is being sold in Arusha/ Kilimanjaro and Dar es Salaam with an exemption of yoghurt which has a high percentage in Mara and Tanga. This distribution is mainly influenced by the presence of a processor or offices in the area as notable is the presence of Brookside in Arusha/ Kilimanjaro and Dar es Salaam region and that is where we find quite a considerable amount of the dairy by products moving. Yoghurt which 89.34% of it is being processed locally is having a presence in Mara and Tanga.


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Figure 10 Milk product distribution by regions

Butte

r-Ki

logr

am

Chee

se-K

ilogr

am

Cultu

red

Milk

-Litr

e

Ice C

ream

-Litr

e

Past

euris

ed F

resh

-Litr

e

UHT

Flav

oure

d-Lit

re

UHT

Fres

h-Lit

re

Yogh

urt-L

itre

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1

2

3

4

5

6

7 8

0.2%

0.3%

40.9%

3.4%

1.7%

8.5%

39.6%

2.2%

0.4%

0.0%

14.6%

3.1%

47.8%

4.6%

27.2%

2.2%

0.0% 0.0%

44.6%

0.0%

54.8%

0.0%0.6%

0.0%

0.0% 0.0%

36.2%

0.0%

16.6%

1.7% 12.1%

33.4%

0.0% 0.0% 1.7% 0.1%

71.8%

0.3% 0.7%

25.3% TangaMaraManyaraDar es SalaamArusha/Kilimanjaro


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v. ManufacturersThe market audit revealed a lot of players in the milk market with different product mix. Butter and Cream & Ghee which was mainly being imported had New Kenya Cooperative Creameries as it main supplier with 42.3% and 87% respectively of the butter in the market being manufactured by them.

Total Butter 2438 100.0 Irish Dairy Ltd 343 14.1 Musoma Dairy Company Ltd 463 19.0 New Kenya Cooperative Creameries 1032 42.3 New Zealand Butter 599 24.6

Butter Manufacturers: 14 Day Sales Sales %

Total Cream & Ghee 4469 100.0 Brookside Dairy Limited 246 5.5 Dairy Land Limited 334 7.5 New Kenya Cooperative Creameries 3889 87.0

Cream & Ghee Manufacturers: 14 Day Sales Sales %

Tanga Fresh was the main supplier of Pasteurized and cultured milk in the market which is in the case were the main dairy products with the highest volume and value in the market


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Total Pasteurised Fresh 410039 100.0 Assas Dairy Ltd Tanzania 33514 8.2 Babati Dairy Limited 3639 0.9 Brookside Dairy Limited 19071 4.7 Dairy Becce Limited 3374 0.8 Gulfana Safa Dairy Limited 7799 1.9 Kilimanjaro Co-Operative Creamaries Ltd 277 0.1 Kraft Food Ltd 126 0.0 Mara Dairy Milk Limited 2251 0.5 Musoma Dairy Company Ltd 7965 1.9 New Kenya Cooperative Creameries 191 0.0 Nyuki Dairy Ltd 5751 1.4 Runa Company Ltd 625 0.2 Soy Limited 252 0.1 Tan Dairies Limited 4516 1.1 Tanga Fresh Limited 309843 75.6 Victoria Dairy Ltd 10637 2.6 Woodlands Dairy Ltd 210 0.1

Pasteurised Fresh Manufacturers: 14 Day Sales Sales %

Total Cultured Milk-Litre 171044 100.0 Assas Dairy Ltd Tanzania 4461 2.6 Babati Dairy Limited 4707 2.8 Brookside Dairy Limited 13494 7.9 Dairy Company Limited 1168 0.7 Kilimanjaro Co-Operative Creamaries Ltd 187 0.1 Lima Numbe Group 4246 2.5 Musoma Dairy Company Ltd 30644 17.9 Nronga Women Dairy Co-Operative Society 187 0.1 Nyuki Dairy Ltd 22653 13.2 Sado Farm Ltd 15892 9.3 Sameer Agriculture And Livestock 553 0.3 Tan Dairies Limited 4583 2.7 Tanga Fresh Limited 64480 37.7 Victoria Dairy Ltd 3789 2.2

Cultured Milk Manufacturers: 14 Day Sales Sales %

Kenyan Brookside Dairy Limited is the main supplier of UHT fresh which is the second largest earner in terms of value and volume amongst the different dairy products.


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UHT Fresh Manufacturers: 14 Days SalesSales %Total UHT Fresh 212,447.71 100.00Al Sakir Food-UHT Fresh 1,202 0.60Brookside Dairy Limited-UHT Fresh 150,895 75.24Clover S.A-UHT Fresh 347 0.17Dairy Company Limited-UHT Fresh 12,133 6.05Mara Dairy Milk Limited-UHT Fresh 1,238 0.62Musoma Dairy Company Ltd-UHT Fresh 16,812 8.38New Kenya Cooperative Creameries-UHT Fresh 5,833 2.91Nile Ltd-UHT Fresh 105 0.05Portions Diary Ltd-UHT Fresh 183 0.09Runa Company Ltd-UHT Fresh 56 0.03Soy Limited-UHT Fresh 185 0.09UNBS Ltd-UHT Fresh 630 0.31Woodlands Dairy Ltd-UHT Fresh 10,561 5.27

vi. Cooler presenceThere was 44% cooler presence in all the outlets that were visited during the survey with Supermarket and Petrol station having 83% and 73% respectively cooler presence. Regionally Manyara had the lowest cooler presence at 26% compared to Tanga region which had a 99% cooler presence in all the outlets that were visited.Coolers: outlet weighted (%) per region

All Regions Arusha/ Kilimanjaro Dar es Salaam Manyara Mara Tanga

Total Outlets 44 49 38 26 52 99

Fast Food 33 0 30 0 0 82

HORECA 41 55 35 25 13 94

Kiosk 32 12 30 0 50 100

Large Dukas 55 60 46 50 83 100

Mini-Supermarket 83 100 78 50 100 100

Petrol Station 73 33 89 0 0 0

Small Dukas 47 50 41 24 58 100

Supermarket 83 50 93 100 0 0

It was also evident that the coolers play a role in the sales of the dairy products as 82% of the sales made were made from the outlets that had a cooler presence hence the need to increase cooler presence in most of the outlets. Most of the Pasteurized fresh and UHT fresh milk found in the market were not being chilled and may be this could be due to the fact that they fast moving and the stock always get finished.Coolers: outlet weighted (%) per product

Sales - 14 Days (000s) Cooler Presence Cooler Presence


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Outlet Wtd Volume WtdTotal Products 960 44% 82%

Cultured Milk-Litre 171 15% 38% Pasteurized Fresh milk-Litre 22 2% 7%

UHT Flavoured-Litre 407 25% 55% UHT Fresh (White)-Litre 25 3% 8%

Yoghurt-Litre 221 18% 27% Yoghurt-Litre 90 6% 27%

vii. Purchase frequencyMost of the outlets visited had very high stocking frequency of the various dairy products with an exemption of cheese and butter which have a purchase frequency of once a month. Cream & Ghee was being purchased once a week and this shows that these products are not being bought by the consumers may beit’s because of the prices or the lack of refrigeration by the outlet owners or the consumers. Most of the milk products were being delivered to the outlet owners with an exemption of cheese and butter where the outlet owners travel to the manufacturer or the wholesaler in order to purchase and stock the product. The low distribution levels for the products could also amount to the low volume and value being sold through the different outlets.

2.0

11.5

1.6

17.6

28.6

12.5

33.3

5.9

6.6

32.4

33.3

32.7

25.0

34.6

23.5

18.0

26.5

100.0

30.6

25.0

12.8

35.3

42.6

14.7

66.7

100.0

6.1

37.5

7.7

35.3

31.1

8.8

Butter

Cheese

Cream & Ghee

Cultured Milk

Ice Cream

Pasteurised Fresh

UHT Flavoured

UHT Fresh

Yoghurt

Purchase > once a day Purchase once a day Purchase twice a week Purchase once a week Purchase once a month

viii. Customer Satisfaction Interviews


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The Retailers were asked to rate suppliers based on certain attributes, 43% of the retailers rated the services from the suppliers as Very good and overall satisfaction as very good. Quite a number (49%) felt that the products from their suppliers are experiencing strong demand from the customers but rated the trade terms as fair. Others attributes rated lowly as “Fair” include having friendly, courteous and professional delivery people which scored 31% and producing accurate invoicing 28%.

ix. Point of Sale Observation

Most of the outlets did not have point of sale observations for the different dairy products with an exemption of Pasteurized milk. There was 11.7% increase Pasteurized fresh milk sales in outlets that have a Pasteurized milk poster. This indicates a need to increase consumer awareness of the different dairy products in the market and the variety being offered to increase sales.Point of Sale Observations

Outlets that sell Pasteurised Milk with Pasteurised Milk Poster

Outlets that sell Pasteurised Milk without Pasteurised Milk Poster

Total Posters Outlet Wtd 100 NA

Sales - 14 Days 231962 178078

Sample Outlets 218 187

Sales per outlet 1064 952


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x. DistributionDistribution levels for Pasteurized fresh milk, cultured milk and UHT fresh is very high with the product being placed in the channels that are moving volumes of the product. Despite the good distribution levels of the three main dairy products, distribution of UHT fresh is very poor in Tanga and Manyara regions. Distribution of pasteurized milk in Arusha/ Kilimanjaro is very low hence translating to very low sales for the product in that region.Volume weighted distribution

All Regions Arusha/ Kilimanjaro Dar es Salaam Manyara Mara Tanga

Butter 3 2 5 NA NA NA

Cheese 1 2 2 NA NA NA

Cream & Ghee 1 4 2 NA NA NA

Cultured Milk 43 77 43 75 72 3

Ice Cream 7 12 10 NA NA NA

Pasteurised Fresh 69 2 79 93 42 99

UHT Flavoured 15 29 19 NA 8 2

UHT Fresh 53 79 67 2 49 4

Yoghurt 32 5 16 NA 64 78


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Conclusion and RecommendationsImported products command 44% of sales in Tanzania. These imported products are mainly UHT, Ghee, Butter and Cream. There is a need to:

Build local brands to increase sales Use consumer communication to drive locally manufactured product sales and reduce

preference for imported productsIncrease butter and cheese marketing due to low purchase and usage frequency. To be able to achieve this we will require;

Dairies to improve cold chain availability by; Availing branded fridges in high volume accounts Branded fridges and freezers should be installed with contractual agreement that only

your brands are in the fridge Ensuring that only your products are in your branded fridges and freezers Ice cream freezers in high volume accounts Ice cream push carts to drive cold chain into middle class neighborhoods

o Affordable brands in this currently niche categoryDairies can improve customer service to high volume accounts by providing trade marketing support and this could be inform;

Provide point of sales materials to provide consumer communication or education and drive sales

Efficient supply chain to ensure delivery on time and avoid out of stocks Stock removal of expired products or leakers Expand your shelf space and cold box presence

General recommendation to the industry

Land O’ lakes will make this information available to individual companies and others interested in promoting milk consumption

Adapt the market audit methodology to identify o Distribution opportunityo Customer satisfaction opportunities

Analyze importation in your respective countries vs domestic Map cooling facilities at retail outlets Review if stock is being rotated in retail outlets and if expiration dates are good

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