BUDAPEST (FNS) -- South African Breweries, which owns more than 80% of the Hungarian brewery Kobanyai Sorgyar Reszvenytarsasag, launched a new version of the market leader Kobanyai Vilagos with a new label. The new version is made to stay fresh for 60 days. The old version of the same beer had a shelf life of only 20 days.
The move is strategic, since Hungarians consume 75% of their beer at home, rather than in pubs or taverns. Thus, most beer is sold through grocery stores, mostly in bottles, although a few imports are sold in cans.
The brewer said the new beer is expected to increase sales by 25% or 30% within a year, with no change in price.
Alan Richards, managing director, said his company had spent $112 million in the last year to improve Kobanyai Sorgyar's technology. Current sales of the brand are a million cases a month [20 half-liter bottles per case].
Beer consumption has declined here since this former communist country began its transition from central planning to a market economy. The result is a market described as "cutthroat" by Rik Bart De Jonge, managing director of the Heineken-owned Komaromi brewery.
Komaromi, formerly owned by the state government, as were all breweries, is one of six breweries now owned by outsiders -- Germans, Austrians, Dutch (Heineken) and South Africans. A seventh brewery is still owned by the Hungarian government.
Under communism, Hungarians drank more beer than they do today, although precise figures are not available. On the other hand, wine consumption, which had relatively low consumption under communism, has increased over the last three years. One reason: Wine carries virtually no "luxury" tax, while beer in Hungary's new market economy is taxed at 35%.
Today, beer consumption is leveling off, with licensed brands relatively static at 25% of the market after substantial growth in the last three years. That category is led by another South African Breweries brand, Dreher. Licensed brands are those owned by foreign breweries that allow local breweries to produce them.
Today, about 60% of the market is controlled by Hungarian brands, led by Kobanyai and Borsodi.
Fighting for second place among licensed brands are Kaiser (German) and Amstel (Heineken-owned). Other licensed beers in Hungary include Hofbrau Muchen (HB), Holsten, Steffl, Gosser and Bitburger. A tiny fraction of the market belongs to premium imports.