Asmara Brewery factory is the brewery plant in Eritrea. At present, even though expansion plan is under way, the factory is working under capacity as a result it could not be able to satisfy its customers needs, tastes and preferences. The factory has two main production lines, i.e. the brewery unit and the liquor unit. Under the brewery unit there are different sections such as Brew house, Fermentation section, Filter room and Bottling lines. Under the liquor unit, there are the following sections.
Distillery section, Liquor house, Fermentation section, Filling line. Beside the main production line, the factory has different utilities section, i.e. the Boiler, Refrigeration section, Generator, Carton section and Crown cap production. The factory’s raw materials are malt, hop and sugar, and are imported from European countries for beer production. Molasses as raw material for alcohol production is imported from Sudan.
The Asmara brewery occupies a total area of 111,505 square meters a tract of land that permits for a great deal of further expansion.
Current land use at the factory is only 55,452 square meters. Even though, the bottling section is located far apart from other sections, the factory has a good plant layout. On the average, the factory has 74,085,582 bottles of 350cc production of beer, a worth of 143,829,441.00 Eritrean Nakfa (ERN) sales per year. A small quantity of beer was crossed the boarder to the neighboring countries of Ethiopia before 1997, but a substantial part of the domestic production is consumed locally. Since local production is not sufficient to satisfy domestic demand, increasing quantities of beer have been imported mainly from Europe.
The Asmara Brewery has completed the brew and fermentation section of the first phase of its expansion plan, and envisages an increase in beer production by 50%. The second phase, which consists of a new bottling line, is also under commissioning. The expansion plan will involve the production of sour beer, non -alcoholic beer and sorghum beer, thus increasing the production lines of the Asmara Brewery.
This capital investment will also enable the Asmara Brewery to produce a first class quality beer, which can be competitive in the international market, thereby increasing its exports. The additional capital investment and the resulting new product lines coupled with the total beer volumes to be increased significantly over the years. The potential to compete in terms of quality in the international market would result in a profitable business establishment of the Asmara Brewery.
Asmara Brewery is located at the capital city of Eritrea, Asmara. It was established in 1939 by Mr.Luigi Melotti. Melotti was an Italian engineer, who comes to Eritrea with colonizers to construct roads. The factory started production with low-tech equipment and with only 25 daily workers.
The total number of employees of the factory at present is 544, out of which 417 are permanent and 217 are temporary. Currently, due to wear and tear, the machinery and equipment could not achieve its maximum capacity. The factory is state owned. However, in accordance of the government policy of privatization, it is in a process of privatizing the factory.
The main raw materials for the Brewery unit are imported barley, hops, sugar, water, yeast and some chemicals. For the liquor unit, the main raw materials are molasses (which is the spent grain of sugar cane) essence (various essences for the different alcohol beverages), sugar and water. For the cooling system ammonia, freon, and glycol are also imported. For the new crown cap production machine sheet metal is the main direct raw material. Except for water all of these raw materials are imported.
The plant is supplied with electric power from Eritrean Electric Authority. Water for the factory is supplied from the Municipality of Asmara. Water from its well being salty, however, it is used mainly for gardening and for washing purposes. For the production of steam and hot water the plant has three boilers. The boilers use furnance oil as fuel while the electric generator uses diesel oil.
The Brewery unit is the main production line of the factory. The process of beer brewing is a batch process. The process starts with the milling of malt, the flours is mixed with water & sugar at 52oC. The mixture is transferred at the same temperature into a mash kettle. The material is then transferred to a lauter (filter) tank where it is filtered. The filtrate which is known as wart is pumped to a wart kettle while the spent grain is transferred to a hopper from which it is loaded on trucks of customers that buy it to feed their cattle. After passing through a resting tank and a centrifugal separator, the wart is cooled in a plate cooler to about 10.5oC and fed to the primary fermentation tanks.
Yeast is added at the fermentation tanks. In the tanks fermentation takes place for about 6 days. The beer is then pumped to the secondary fermentation tank or storage cellars. Here, fermentation continues for about 30 days. The beer is then filtered as bright beer. Finally, it is filled in bottles, corked, pasteurized and either sold directly to consumers or stored as finished product. At every stage of the process there is a quality test and/or inspection with regard to the type of beer, the factory produces Lager beer with an alcohol contents of 4-5% and bottles it in 0.35 litres.
Processing in this unit is initiated by mixing molasses with water. Concentration solution is then adjusted until the specified standard is reached. Yeast and ammonium salts are added to the mixture. The mixture is transferred to a tank where open fermentation takes place for a period of about one week. The fermentation product is then pumped to a distillation column.
Fractional distillation takes place and the following products, by products and wastes are produced.
At the finishing stage, first essence is dosed or added to the ethanol. Then the solution is diluted with water till the desired alcohol content is reached. The liquor is tasted in the laboratory and other inspections are made before it is bottled and labeled. It is then either directly sold to customers or stored. The denatured alcohol is also bottled and labeled and then sold directly to customers or stored. It is used for pharmaceutical purposes.
International trade has resulted in a global economy that interconnects the economies of all nations into what has been termed the global village. Economic events in one country affect economies of all countries. For example, a recession in one country affects all other countries and one country’s recession can become a global recession.
Product sharing means that a product may be designed and financed by one company; raw materials may be produced in many countries and slipped to other countries for further processing, parts may be shipped to yet another country for assembly, and the product may be sold through out world markets. The country that is the highest quality and least cost producer for a particular activity would perform that portion of the production of the product.
To succeed in global competition in the twenty first century, companies must quickly develop innovative products and respond quickly to customers’ needs. Automation not only reduces labor cost and increases labor productivity but also can improve product quality and speed up the introduction of new products. At present the factory is importing malt, hop, sugar (High quality) from abroad, mainly from Germany. However, due to obsolete machinery, processing system, the product is not as excellent as its raw materials. As the result of high government taxes, almost all materials are imported, and because of obsolete machinery, the factory has cost challenges.
Though the factory is trying to introduce different types of beer products, since, did not introduce non-alcoholic beer, the factory cannot exploit the potential customers that are 50% of the Eritrean population is Moslem followers. The factory’s product is of standard quality, even to the extent that the quality was superior as compared to the neighboring countries beer products. For instance, till 1997 the factory was the major exporter of beer to Northern Ethiopia. At that time the tests and performances of the customers was very high.
Although the initial cost of these assets is high, the benefits go far beyond a reduction in labor costs. Increased product/service quality, reduced scrap and material costs, faster responses to customers needs, and faster introduction of new products and services are a few of their benefits. The Asmara Beer factory is expanding its bottling plant with automated machineries imported from Germany. Their production volume will be absorbed in the local market (90%), and they will have a plan to export the remaining quantities to the Middle East in the form of non-alcoholic beer.
After commissioning, renovation and expansion project of the new filling plant, beer production capacity of the factory will almost double. The expansion of the factory is under way with modern technology that is, the first phase of expansion of brew house and fermentation section has been completed and the second phase of bottling section is under commissioning.
The scarcity of funds, employees, and other operations resource need a wise allocation in order to use them efficiently. The production process section of the Asmara Brewery has been built far apart among each other, like the brew house, fermentation section, filtration section, and the filling plant. This implies the factory has used enormous space; long pipelines, more energy, high maintenance cost, and these can result in wastage of resources.
Many manufacturing companies sell some of their products to service companies. The network of interrelationship between services and manufacturing calls into the question the phrase service economy, because many services clearly could not exist without a strong manufacturing sector, and the reverse is undoubtedly true. The existence of Asmara Brewery as a well-experienced factory is very important for the continuation of service economy in the country as a whole and vice versa.
Important factors in relation to social responsibility are:
From our observation in the Asmara Brewery factory there is a clear and transparent recruitment policy, employees are obliged to use safety methods, and factory applies quality control over all production process.
Product safety for customers or consumers is of great concern to companies and governments. Harm to people or animals that results from poor product design damages a company’s reputation. In the case of the factory, up to now there are no complaints to the product design. But sometimes it occur unnecessary test on the beer due to more oxygen (air) containing in the bottle or low amount of carbon dioxide at the time of filling. Due to more or less pasteurizing temperature its taste is changing. Sometimes this inefficiency leads to low demand of beer by the customers.
This means selecting the type of production design, type of production processing systems, and type of finished goods inventory policy for each product group in the business strategy. In our case study, the Asmara Brewery factory is designed as standard products, which is only produced lager beer and different types of alcoholic beverages. It is product focused production systems, because it has only few standard products, each with a high volume like Lager beer, Dry gin, Alcohol sprit, Cognac, Ferenit. If we are looking on the finished-goods inventory policies it is the produce-to-stock policy, because products are produced ahead of time and placed in inventory. Then products are dispatched from the inventory immediately as per orders to whole sellers and agents.
When we are looking on the product life cycle, the Asmara brewery factory is at growth stage. This means the sales volume grow dramatically, marketing efforts are intensifying, even though it is the only brewery factory in the country, production concentrates on the expansion capacity, fast enough to cope up with the local demand and factory profits. Especially when the new filling plant starts working, the production capacity will be doubled and the demand of the customers will be fulfilled.
The existing filling capacity of the brewery is annually about 74 million bottles of 350 cc. To satisfy the local demand of consumers, the factory is introducing a new filling plant with the aim of doubling the volume of production. When the expansion plan of the filling plant is implemented, the factory is expected to produce export-oriented products such as, caned beer, black beer, and non-alcoholic beer.
� The factory does not have an efficient waste treatment unit. At the moment it is draining all of its wastes without any treatment to the sewerage system of the Municipality of Asmara. Some of the liquid wastes that come out from Asmara Brewery are:
During over haul period’s washings of all the process system, boiler, emergency generators workshop, cooling system, the clinic, and the Co2 plant and of the compound.
According to the new government policy, injection of capital is not allowed to all government enterprises, but they are ready to privatize them. Believing that private ownership and investment are likely to be the quickest and most reliable route to renewing the beer industry, and in the long term to be come a sustainable, commercial enterprise.
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