Illovo Sugar Malawi recently decided to localize the sourcing of its packaging material, and has since successfully awarded contracts to supply packaging materials for its pre-pack and bulk sugar to local companies.
This is one of way the many ways in which the company continues to contribute to the economy.
Sourcing of packaging materials locally is a major move towards developing local businesses as well as contributing towards local job creation.
The contracts which were awarded through this localization process are worth over K6 billion per annum and will run for three years, subject to renewal.
“While most of the input materials are imported into Malawi, the cost of local conversion is often more competitive resulting in a more attractive solution than importing the final products.
Our sourcing strategies together with comprehensive local supplier engagement have ensured that packaging prices are fair and market related”, says Illovo Sugar (Malawi) Plc Managing Director Lekani Katandula.
The contracts will also benefit the local suppliers in securing additional funds to invest in better and bigger manufacturing infrastructure for production of high quality packaging materials not only for Illovo, but for their other local as well as export customers.
Illovo is committed to work with local packaging suppliers who demonstrate potential and are been keen to work jointly with Illovo on this journey towards high quality and sustainable packaging.
Illovo hopes to enter into longer term agreements with the suppliers so that we can work together on significant projects that will provide sustainable packaging solutions while reducing total supply chain costs.
“Local suppliers are already familiar with the local laws and the projects aimed at reducing the impact of packaging to the environment. They are therefore well placed to assist Illovo in developing appropriate sustainable solutions locally,” Katandula said.
Katandula further added that the opportunities created are also in line with the company’s “Creating Thriving Communities” strategic purpose.
“Sourcing of packaging materials from local suppliers is a true reflection of our commitment towards creating a thriving Malawian community. The contracts given will not only directly benefit our suppliers, but also all those within the packaging supply chain in support of fulfilling the contracts.
The additional disposable income that has been created will also used to support the supply chain player’s families and enhance economic growth within their respective communities.”