Heat turned up in vetkoek fight

YANNA SMITH



Following an application brought before the High Court on 6 December last year against Bokomo Namibia, Namib Mills has filed a supplementary affidavit to amplify its complaint.

The December matter pertained to the packaging of Bokomo’s vetkoek wheat flour product, which Namib Mills says is uncompetitive in that it is too similar to Namib Mills’ packaging, using mustard yellow.

Namib Mills now seeks an interdict restricting Bokomo not only from selling its vetkoek flour in its current packaging, but also all its cake and bread flour products in their new packaging.

The matter was heard yesterday by Judge Hosea Angula.

Last year the court granted Namib Mills permission to file the supplementary affidavit, in which it seeks to amplify its claim against Bokomo.

In his papers, Namib Mills commercial manager Pieter van Niekerk told the court that “in addition to the appropriation by Bokomo of the get-up of the Bakpro vetkoek flour product, Bokomo is now also using a very recently introduced get-up in respect of its remaining products in its flour range”.

This new packaging, he said, is “markedly different” from that previously used.

“The respondent’s appropriation of the applicant’s pack architecture can only be explained by an intention to appropriate benefit from the existing reputation vesting in the get-up of the Bakpro flour products, or to cause confusion in the market, or both.”

The intention, he said, is for Bokomo to garner sales at the expense of Namib Mills.

Van Niekerk explained that Namib Mills’ Bakpro packaging has a distinct look and feel. The top two-thirds of the product is white, along with the brand name and a picture of the flour product. The bottom third has a slash or band in a particular colour.

“We deliberately use the same packaging architecture across the range in order to ensure that the products all convey the same message to consumers regarding not only the quality but their common source, Namib Mills. It allows purchasers to easily identify and distinguish a Bakpro product from other products on the shelf.”

The current packaging has been in use since October 2016 and Van Niekerk said that considerable time, effort and resources went into generating a good reputation for its Bakpro range of products.

He detailed the advertising and marketing undertaken on various platforms since the 2016/17 financial year, totalling in the region of N$9.3 million. This money was spent to create and maintain brand equity for Bakpro, he said.

According to Van Niekerk, Namib Mills had objected to Bokomo’s rebranding and after the application for the interdict restraining Bokomo from selling its vetkoek flour in the current packaging was filed, Bokomo “nevertheless persisted with its rebranding exercise” and products in the new packaging started appearing on the shelves around 21 November last year.

He told the court there was “no need” for Bokomo to have changed its packaging architecture to one which “mimics and adopts the essential elements of the Bakpro range”.

He said they believe this “change was intentional with a view at least to appropriate benefit from the reputation and goodwill vesting in the Bakpro products”.

Namib Mills, he said, believes the adoption of the new packaging by Bokomo is in contravention of the Industrial Property Act because its conduct is outside the “parameters of fair and honest competition”.

In his affidavit, Van Niekerk added several annexures demonstrating that “no manufacturer uses the pack architecture of a competitor in the same way Bokomo does”, showing packaging of the same products of Knorr and Royco, yoghurt packaging of Nammilk, Danone and Parmalat, juice products, rusks, rice, oats, sugar, milk, pasta, laundry detergent, nappies and more.

“In short, practices in the trade are clearly not to copy and appropriate each other’s brand equities.”

In his answering affidavit, Hubertus Hamm, CEO of Bokomo Namibia, told the court that the company had launched new packaging in 2015, but due to the specific design, the picture of the flour printed grey.

“This had dismal consequences for Bokomo because the grey flour did not represent pureness” and consumers turned to their competitors. “Significant losses of sales of Bokomo wheat flour occurred,” Hamm explained.

A decision was then taken to change the packaging in phases, which began in 2017. He explained that research indicated that a consumer was more likely to purchase a flour product with a picture of the final product on the packaging, and they essentially cleaned up the lines of the design to make it more ‘crisp’. A logo change was also on the cards.

At this point, Hamm explained, a vetkoek mix was not yet a consideration and did not feature in the design plans.

“Bokomo would not have introduced a vetkoek flour product had it not been that (Namib Mills), as market leader, did so.”

Thus, he continued, the “new Bokomo pack design was quite evidently independent to any pack design of Namib Mills and aimed particularly at differentiating the Bokomo brand from that of Namib Mills.”

Hamm concurs with Van Niekerk’s assertion in his founding affidavit that their white bread flour sales took a knock when the vetkoek flour was launched by Namib Mills, but asserts the Namib Mills’ product is “nothing but white bread flour packed in its vetkoek pack”.

Bokomo’s sales dropped by 41%. For Bokomo to remain competitive, Hamm said, it had to launch its own vetkoek flour.

“As the Bokomo rebranding exercise was under way, it was decided the vetkoek flour packaging should be in keeping with the focus of the to-be-adopted rebranding.” Market research, he said, indicated that consumers preferred the yellow colour.

He went on to list differences in the packaging of the vetkoek flour of Bokomo and Namib Mills.

He further explained that as the vetkoek flour was a new entrant into the market, there was no need to first run out of old packaging and that it made sense to launch it in the soon-to-be changed packaging of the other Bokomo products.

He also denied the ‘uniqueness’ of Namib Mills’ vetkoek flour, saying it is simply white bread flour. He added photographs of the nutritional value of the two Namib Mills products, showing they are the same, and added that Bokomo’s values between the two products differ.

His lengthy and explanatory affidavit covered many varied aspects including denying that Bokomo spends “little or nothing” on marketing. The company spent N$5.8 million between the 2015/16 and 2017/18 financial years, he said.

Bokomo yesterday asked the court for condonation for late filing. Its answering affidavit was to have been filed by 24 January, but was only filed on 4 February. The reason for this was the late completion of marketing research, which was initiated as a result of Namib Mills’ founding affidavit. Namib Mills has objected to the condonation, saying that their heads of argument must be filed by 7 February and this prejudices their case. Technical arguments were heard before Judge Angula yesterday and Namib Mills will request interim relief in court today.

Tobias Louw from Theunissen, Louw and Partners appears for Namib Mills, while Daneale Beukes from Engling, Stritter and Partners appears for Bokomo Namibia.