Virginoo for Trading & Distribution is an SME specialized in the manufacturing and distribution of instant coffee. The company is looking to increase its competitiveness through investing in an in-house blending and packaging line instead of relying on outsourcing its manufacturing operations.
Virginoo was established in 2017 and specializes in the distribution and marketing of instant coffee and hot chocolate products. The facility is located in Badr City, Egypt. Currently, the company exports 20% of its products to Kuwait and other neighbouring countries, and 80% are sold through local stores and large retailers.
This investment allows Virginoo to expand its business model and safeguard against future cost increases in production and packaging, thereby enhancing its competitiveness. The new production line consists of 6 machines which cover the entire process from the blending of raw materials (coffee beans/cocoa?) to packaging of the final product. The line will produce 80,000 cartons of instant beverages? per year at a lower cost compared to current practices increasing the company’s profit margin by approx. 50%, which will be reinvested into growing the business.
The GVC team assessed the technical and financial feasibility of the project, provided advice to the company on the best available technologies and evaluation of the different operational steps. The assessment confirmed that the investment will enhance the competitiveness of Virginoo’s operations. The expansion into the manufacturing and packaging of instant beverage products will enable the company to enhance quality control over their products and make their business model more robust. The implementation of this project through the Egypt Green Value Chain financing facility has provided Virginoo with technical assistance and an investment incentive which enhances competitiveness.
The total investment of EGP 1,015,000 (US$ eq 63,489) will be partially funded through Egypt Green Value Chain financing facility and will increase annual net profits by approx. 50%. It will enable the Company to introduce a new service, integrate its value chain operations and increase export potential.
The Egypt Value Chain Financing Facility was developed by the European Bank for Reconstruction and Development (EBRD) and is financially supported by the European Union (EU) and the EBRD Shareholder Special Fund (SSF).
GVC/VC Sub-borrowers receive an investment incentive for successful project implementation, provided by a grant from the EU.
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