Welcome To The Octagon.
The Octagon: We appreciate you taking time out to Join this Chat Session which will end at 5pm (1 Hour). We have two moderators in the room who will only offer guidance where necessary. Please feel free to openly share your thoughts and experiences. Let’s begin with introductions. Can everyone let us know who they are and share a bit about what they do?
Ofili: I’m Okechukwu Ofili, a multipotentialite Addicted to Truth and Allergic to Bullshit! Founder ofilispeaks.com and okadabooks.com. Author of 4 funny books
Bolaji: My name is Bolaji Iwayemi and I’m the Marketing Team lead for Paga, Nigeria’s No.1 payments company.
Daniel: Hi, I’m Daniel Emeka … Digital and Marketing communications| Rookie Tech Entrepreneur.
Gbadebo: Gbadebo Rhodes-Vivour – Architect and Creative director for Literati clothing.
Lolade: My name is Lolade Fadoju. I work within Digital Marketing for GTBANK and Head the SME MarketHub. It’s a pleasure to meet you all
The Octagon: Thank you for the introductions.
Several studies have shown that when you buy from an independent, locally-owned business, rather than a nationally-owned businesses, significantly more of your money is used to make purchases from other local businesses, service providers, and farms — continuing to strengthen the economic base of the community.
Senator Ben Bruce recently started the #BuyNaijaToGrowTheNaira campaign.
In his words, “Obviously we cannot cut ourselves off from the world. No nation is an island, but at least we can fly Nigerian airlines, eat locally produced food and patronise our football league. If we do this, not only will our economy grow and produce jobs for Nigerians, it will also make our goods and services improve in value such that they will be attractive enough to be imported.”
Understanding the need for Local content, Should we be creating localized versions of international businesses winning the Nigerian market.? How can we get Nigerians more comfortable with Buying Local and appreciating local businesses?
Bolaji: Quality plays a huge part in buying Nigerian. No matter how much I love my country I will not excuse mediocrity. Another issue is the fact that little to no manufacturing occurs in Nigeria. So when we “buy Nigeria” are we actually buying Nigerian.
Gbadebo: Currently a £20 pound T-shirt now costs 10k. I think at the rate we are going it would no longer be a question of making people comfortable. It would be people actively looking for substitutes. The onus would be on the makers to be able to fill that gap.
Bolaji: @Gbadebo very true but we need to change your perceptions first.
Daniel: Understanding the consumer and insights that drive their purchase behavior is key creating good enough content for them to buy. I started www.ethnikcity.com on the premise that, a lot of Nigerians complain about failed processes when dealing with Nigerian artisans and manufacturers.
Ofili: But can they? Is the Government doing enough to help us grow. Doing business in Nigeria is very hard. Legal Taxes are high and illegal taxes are higher aka omo nile.
Bolaji: @Ofili how do we by-pass the govt and “create our own destinies”?
Ofili: It’s difficult …with okadabooks we have minimum exposure to Government. We are a software, and our office exists in the cloud. But for manufacturing businesses it is difficult. I watched my Dad become a shell of himself trying to run a plastic company in Nigeria as an honest man. It killed him. The government took everything he had and gave him nothing. No light no power nothing. So it’s hard. Lindaikeji can thrive because it’s software same with Bellanaija. But when you start manufacturing physical products it’s impossible to dodge the government.
Bolaji: The cost of 3D printing is dropping. Imagine your Dad could running his company at about half the cost. For food and some elements of clothing “buy Nigeria” is very alive.
Ofili: Agreed. But you still have to deal with Government regulations. You have to transport. You need power. They will tax you etc. In the US you get tax breaks as a business. In Nigeria you get broken by taxes.
Bolaji: There are tax breaks in Nigeria. Pioneer status entitles you to 4 years without paying income tax
Ofili: Can you explain that term “pioneer status” I am not familiar with it.
Bolaji: Pioneer status – you’ve created something new in the market
Daniel: Nigerians will not buy from you because you are Nigerian. They will buy because your product feels a void. But from a branding perspective … the #BuyNaija causes trials. Retention is now what your product and service gives you.
Gbadebo: I think we need to separate consumers. The mass market does not care too much about where things are made. Mr Ofili wrote a brilliant piece about made in Aba once. There was a time that the made in Nigeria perception was a positive one.
The Octagon: Until recently when it became harder to purchase imported brands, it was difficult for Nigerian businesses to develop products to compete with these brands. The competition did gave them little or no chance to break in. If dollar rates where low how do we still convince the populace that buy Nigeria is important. Or this conversation only important for tough times.
Bolaji: This is a very good point because once FX stabilizes people will go back to foreign products.
Ofili: Buy Nigeria is key and logical. It’s just that the quality has been lacking. I printed books in Nigeria and now I give them out for free because the print quality was bad. But hopefully companies like Printivo can break that cycle.
Gbadebo: Currently to stem the effects foreign exchange has on our business we have localized our production, especially the labor-intensive parts. Another thing to consider is the huge margins one can make by earning foreign currency with sales to the International Diaspora.
Bolaji: The Government has a very important role to play to create a conducive environment to manufacture locally.
Ofili: I don’t think so. If the quality is good people will buy Nigeria. It’s quality. How do we get quality. A handy man has done the same job in my house 2 times, each time it was poor. If we somehow get our people to understand quality it will help. And I feel it starts with our universities and technical colleges. The quality disrespect starts at that level.
Bolaji: I was watching NARCOS and thought that the model used was great to bring in Forex but the product was wrong.
Lolade: I believe every individual plays a role, not just government. Consumers demand good quality and competitive pricing. For a long time, several businesses survived by importing top quality to feed local demand. Of course, this has become more challenging with USD hovering around N400 and GBP north of N500 (would be north of N600 if not for Brexit ). Because of this, we are noticing some new trends with businesses trying to circumvent the FX challenge.
1) Some are importing MORE from other markets outside of the US and UK (eg, China, India, Canada, Turkey, Middle East).
2) Some are trying to start producing and sourcing locally.
Unfortunately, as everyone would agree, manufacturing is a major challenge. Seems a little like a chicken and egg problem, but my conscience still pricks me to support Nigerian businesses because I believe it is for the greater good. This means sometimes I will have stones in my rice or even a roughly finished seam in my clothing. But for me it is an ethical decision.
Bolaji: Very well said. However, Quality is relative. A brand like Polo by Ralph gives a distinct experience that no local brand can give.
Ofili: The other thing I see is that a lot of businesses look to create products for Lagos and not Nigeria. So the quality products are priced and branded for one market.
Gbadebo: What we did in our case was we set up a 5 month experimental phase, sourcing the fabrics washing and testing them, then doing several samples until the tailors stepped up to the quality of finishing we expect. It is a costly process but we also have to consider that the quality of finishing and workmanship is a direct reflection of the ‘anyhow-ness’ that pervades our society…and most Nigerians don’t actually see what we call poor finishing as normal. It’s
Bolaji: Hmmm research and development. Something that’s lacking here. Well done
Gbadebo: That’s what we did I don’t think it applies to every sector, but that was a solution in ours. Another thing is to go out of your comfort zone, I got that advice from The Octagon actually. So we went to ikorodu to set up.
Lolade: There is a woman by the name of Bethlehem Tilahun Alemu. She runs a company called Sole Rebels based out of Ethiopia. She has been used as a case study by the global trade community for her role in ethical manufacturing. She sells shoes that are made by marginalized communities in Ethiopia. Her products retail at Urban Outfitters in the US. Guess what…people buy them not because the finishing is perfect, but because they understand that there is an ethical obligation to supporting developing economies