SIR – Your article entitled Is UBL in a Crisis, in the SBR June 2014 issue, tried to position UBL in bad state. While I agree to some of issues raised in the article, the writer tried to insinuate that Nile breweries has got everything working fine, which may not be the case.
I want to bring to your attention that about 60 per cent of Nile breweries market share depends on one product -- Eagle beer – which is a low-end product. Such dependency on a single brand is risky for business continuity considering the short product life cycle for beer products in Uganda. Suppose a new entrant comes up with a better alternative or competitor comes up similar or better product, they would do badly. UBL had the same scenario and that’s where their problems started.
Recent reports indicate that Uganda has the highest drinkers per capita. Many people in Uganda drink a lot. Such statistics are attractive to breweries and similar companies. With new entrants like SKOL from Rwanda, the Ugandan beer market is set for much competition and the winner is yet to be known.
Name withheld on request
SIR – I found your analysis of the current dilemma in which UBL finds herself spot on especially the revelation that “UBL is run from Kenya.” I must say, as a former UBL employee, I found Kenyan management too involved in the operations of UBL as they are responsible for all decisions including small operational ones. It is so bad that some brilliant Ugandan employees have to defer decisions they would have made to people who are not on ground and may not be as brilliant as the local staff.
That is not the bad thing. The inability to undertake swift decisions as market dynamics may dictate is one of the key failings of UBL.
One could say that is the same problem that has negatively impacted BAT. The same problem that will likely kill Uchumi supermarket – which is said to be losing market share to the newly established Capital Shoppers at Garden city mall. By far, many businesses with head offices in Kenya tend to undermine local employees something which is very demotivating and kills business.
To regain her former glory, UBL needs to restructure. Decentralizing and appointing locals to run the Ugandan operations is the first critical step. They could monitor the market developments through clear targets and performance indicators. Otherwise, modern management recommends empowering locals to run the show as provide critical support in the back-end. -Via internet
Generic vs brand name medicines
SIR – It is unfortunate that many health providers recommend brand name medicines instead of generic ones when they know both give the same results. A simple review of the pricing in several hospitals and pharmaceuticals reveals that brand name medicines costs as much as five times higher than their generic equivalents when they have the same impact.
The increasing cost of health insurance in Uganda is due to high cost of health care. Most medical practitioners will recommend brand name medicines at their clinics instead of generic ones. The top reason for this is brand name medicines give higher returns.
There must be a deliberate government strategy to promote awareness. Health providers must also be encouraged to recommend generic medicines to patients so as to increase demand. In the long run, this will reduce the cost of medicines, lower costs of insurance premiums and thereby increase health insurance penetration as it will become affordable.
The plans by government to make health insurance compulsory may not work unless critical strategies and strong foundation for implementing the same are put in place.
James Kasaija, Kampala.