daniel chigunwe
Francis Gakanje
Dairibord Holdings Limited’s strategic initiatives, including toll manufacturing and support programmes for farmers, have not only boosted its financial performance but also contributed to the development of local communities, chief executive officer Mercy Ndoro has said.
The firm witnessed a notable 40 percent growth in raw milk supply against a national growth of 22 percent for the half-year period ending June 30, 2024. This robust performance solidified the Group’s dominance in the market, with its market share expanding from 28 percent in 2023 to a commanding 36 percent in the current period.
In the period under review, Dairibord saw its profit surge to US$3 million from a loss of US$736,000 posted for the prior year after revenue grew to US$54,711,340 from US$48,472,791 prior year comparative.
Speaking in an inteview on CapitalkFM on Wednesday, Ndoro, attributed the surge in performance to a proactive strategy involving aggressive recruitment efforts and enhanced yields among contracted dairy farmers.
“The efforts of our milk supply development unit made it a responsibility to interact with farmers and grow raw milk which began to bear fruit,” said the chief executive.
The CEO said this reflected resilience in the face of a challenging economic environment.
She noted that the volume and revenue performance for the half-year period reflected a positive trajectory enabling the group to achieve good results despite challenging conditions.
The group also experienced significant growth in export volume, particularly to regional markets including South Africa, Botswana, Zambia, Mozambique, and Malawi.
“These markets provide the advantage of proximity, along with cultural similarities and an increasing demand for the group’s products,” according to the chief executive.
Dairibord added that it was starting to witness a gradual increase in export activity to the United Kingdom.
According to Ndoro, several strategies continue to be put in place to enable further expansion for the business particularly export reach.
She noted that the toll manufacturing initiative in South Africa has become a strategic priority for the group, as it was unable to fulfill export demand for that market through its Zimbabwe operations.
“The primary advantage of toll manufacturing for the group lies in the collaboration with third-party manufacturers, which allows for the elimination or reduction of capital expenditure.
“By leveraging the existing infrastructure and excess capacity of manufacturing partners, the company incurs minimal financial outlay, providing a significant benefit to the business.”
As indicated by Dairibord, this approach will facilitate the group’s expansion by allowing it to grow its presence in South Africa and regional markets, while also providing a competitive advantage through production in a low-cost environment and supporting foreign currency generation amidst ongoing shortages in Zimbabwe.
Additionally, the company is partnering with local distributors and retailers in target markets to ensure efficient distribution and reach to the broad customer base.
“Maintaining high standards of quality and investing in brand-building activities are essential for success in export markets and these strategies will remain a central focus for the group moving forward,” added Ndoro.
The company positions itself as an inclusive business, taking pride in being the only dairy processor that actively supports small-scale farmers in enhancing national raw milk production.
As such, the company is currently collaborating with over 480 small-scale farmers and operates 13 milk collection sites, offering financial assistance and various programmes, including veterinary support.
Additionally, the company provides nearly 1,000 vending opportunities nationwide, with a particular emphasis on empowering women, who represent approximately 65 percent of its vendors while creating opportunities for small businesses to procure supplies from these small-scale farmers.
These initiatives enable small-scale farmers and marginalised communities to promote better nutrition and earn an income.
Bongani Ndlovu