South Africa’s cherished Beacon chocolate range, a staple in the lives of many for nearly a century, is now at a crossroads as Tiger Brands, one of the country’s largest food producers, has announced plans to explore its sale.
CFO Thushen Govender reassured consumers that while no final decision has been made, the company’s leadership is actively assessing options to divest from its chocolate category.
‘We will continue delivering on the strategic turnaround of the business until such time as an appropriate exit mechanism has been identified,’ as quoted by News24.
Tiger Brands’ CEO Tjaart Kruger elaborated on the hurdles facing the Beacon chocolate business in an interview, acknowledging the company’s struggle against larger competitors in the market, particularly Cadbury.
‘We price against Cadbury like R4 or R5 a slab cheaper and still don’t get the volumes,’ he lamented, pointing to a pricing disparity that has not translated into sales success as reported on News24.
Moreover, Kruger noted a significant issue plaguing the chocolate division: outdated technology. He revealed that the company has not upgraded its chocolate-making equipment in over 30 years, leading to ballooning costs that now render modernisation unfeasible.
Nevertheless, he remains optimistic about the Beacon brand’s future, asserting that under the stewardship of the right entity, it possesses considerable potential.
This announcement comes closely on the heels of Tiger Brands’ recent strategic shifts, including the sale of its deciduous canned fruit business, Langeberg and Ashton Foods.
This decision, made five years after the initial exit announcement, aims to better align the company’s portfolio with its evolving vision.
The sale is now set to transfer operations to a new company backed by a consortium of vested parties, ensuring continuity for the 3 000 employees who rely on the business for their livelihoods.
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Picture: Parklane Superspar / Facebook
