Olympic Committee Steps into Water Bottling Business

Sep 8 , 2019. By YOSEPH MERGU ( FORTUNE STAFF WRITER )

The Ethiopian Olympic Committee is stepping into a profit-making business by constructing a water bottling and juice processing plant at Chacha, Amhara Regional State.

The Committee is investing 97 million Br for the plant that is located in North Shewa Zone, Angolalla Tera Woreda, which is located 100Km from Addis Abeba. The Committee secured five hectares of land on a 60-year lease agreement for 10 million Br. It paid one million Birr as a down payment, and the remaining will be paid over the coming 40 years.

Initially planning to set up the plant in Dima Woreda of the Oromia Regional State, the Committee switched the plan to Amhara Regional State due to a late response from the former regional state, according to Tibebu Gorfu, assistant project coordinator of the plant.

For the people who will be relocating from the land for the project, the Committee has paid 2.8 million Br through Amhara Credit & Saving Institution.

Amhara Waterworks Construction Enterprise has already finished the water drilling process within a month before the Committee imported machines and hired employees to construct the plant. The plant, dubbed the Ethiopia Olympic Committee Bottled Water & Juice Factory, will be the 86th water bottling plant when it becomes operational next year.

While the Olympic committee will cover 30pc of the cost, the balance is expected to be covered by the Ethiopian government and some sports partners from abroad, according to Tibebu.

“Finding the right partners on time is the challenge that we anticipate facing,” he said.

The Committee sources income from renting buildings, membership fees, and promotions, as well as the Adidas Company and the government. The Committee and Adidas have an agreement for promotions.

The plant is not the only water bottler and beverage plant in Chacha Wereda. Alpha Mineral Water, Komari Liquor, owned by European investors, Wub Water, as well as Habesha and Dashen breweries, have invested in the area and Debre Berhan.

The water bottling and the juice processing plant is part of the many projects planned by the Committee to generate revenue, according to Tibebu.

A five-star hotel, a warehouse and sports centres are among the projects that are planned by the Committee. For the construction of the five-star hotel, the Committee has secured a 13,739Sqm of land around the Riche area.

To penetrate the market, the Committee plans to pack the water in a glass bottle and supply the water to consumers in the sports community.

Getie Andualem (PhD), a lecturer at Addis Abeba University's College of Business & Economics, is cautions the company to closely look into the industry before starting production.

"These days there are financial constraints on businesses to produce at their full capacity," said Getie, "so the Committee should check if other water bottling companies in the country are producing at full capacity or not."

PUBLISHED ON Sep 08,2019 [ VOL 20 , NO 1011]