Al Ahram Beverages sales affected by decline in tourism

Aisha Zidane
4 Min Read

Al Ahram Beverages Company (ABC) increased its prices by 10% due to the decrease of the Egyptian pound’s value against the US dollar, despite sales slowing since last November.


According to Jan-Kees Nieman, ABC’s managing director, the company increased the price of some of its products by 10% as almost 25% of the raw materials used for production are imported from abroad, which requires using the US dollar and therefore increases the cost of production.


Nieman expects that prices will continue to increase in the upcoming period if the Egyptian pound continues to decrease in value against the US dollar, increasing the cost of production for ABC.


Speaking about the company in 2016, Nieman expressed that he does not expect that the company will achieve the desired amount of sales this year as tourism remains in decline.


The company’s sales decreased in November and December 2015 after the downing of the Russian aeroplane in October 2015 that caused the death of 224 people. Since the end of 2015, the company’s sales have continued to decrease with the decline in tourism.


“Some of the countries which used provide tourism to Egypt have still not announced when they will resume facilitating tourism to Egypt once more,” he added.


As for the floating of the Egyptian pound against the US dollar, Nieman stressed the increase of ABC’s production costs as all imported ingredients involve the use of US dollars.


On a national level, ABC directly pumps investments into the local market via products or by expanding distribution throughout Egypt. On an international level, the company exports to a few countries in Africa and Asia. However, in the upcoming period, ABC targets not only to increase its exports but also to increase its production in general.


As the company’s sales depend on tourism, ABC supports the revival of tourism. ABC organises training courses for people who work in the tourism sector. “We consider this as the company’s corporate social responsibility,” Nieman said.


So far, during the past year, the company has trained 275 employees within the tourism sector. At the beginning of this year, it started training another 80 employees. Unfortunately, it stopped the programme as tourism continued to decline after the Russian aeroplane crash.


These training courses are organised in cooperation with the Egyptian Tourism Federation, the Egyptian Travel Agents Association, and the Egyptian Hotel Association.


“Since a large percentage of the people who worked in the tourism sector left it, the company’s training courses will resume when tourism returns,” he expressed, adding, “The company allocates an open budget for this training programme as trained employees are important for guaranteeing the recovery of tourism in Egypt and the recovery of our sales.”


Nieman concluded that the company further supports tourism by hosting famous international figures in Egypt, so that these figures can then promote tourism to Egypt in their own countries.


For example, Spanish football legend, Carlos Puyol, was invited to Egypt at the end of May, where he visited the Pyramids and gave a speech in a press conference.

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