Categories
Archive Blogroll

Growing A Southern Brand To Global Success: The Olam Story

Most people haven’t heard of Olam International, but they know the brands they work for and they more than likely eat their produce. The story of Olam (http://www.olamonline.com) – a global food supply company in ‘agri-products’ that got its start in Nigeria – shows how a Southern brand can grow and go global, and overcome the difficulties of cross-border trade.

Olam supplies well-known global food brands including Cadbury (chocolate), Nestle, Lavazza (coffee), Mars (chocolate), Tchibo and Planters (peanuts).

Olam not only survived its startup in Nigeria, it has thrived, trading around Africa and across the globe, becoming a major supplier to the world’s top food brands.

The quantity of agri-products harvested in the world is 5.2 billion metric tonnes. In that market, Olam is a significant producer of cashews, peanuts, spices, beans, coffee, cocoa, sheanuts, packaged foods, rice, wheat, barley, sugar, cotton, wood, and rubber. It is already the world’s largest supplier of cashew nuts and sesame nuts and in the top three for peanuts. Olam’s cashew business in Africa provides work for 17,000 people, 95 percent of whom are women.

Olam also uses its success to play a critical role in securing the world’s food supply and has specialized in meeting the food needs of the world’s rapidly growing population, especially in China and India. Between 2001 and 2007, annual increases in the global consumption of agricultural commodities were larger than during the 1980s and 1990s. Higher incomes are leading to higher consumption of proteins like meat. And as meat demand rises, so does the demand for grain and protein feeds to produce the meat. It takes two kilograms of grain to produce one kilogram of chicken, four kilograms of produce for one kilogram of pork, and eight kilograms of produce for one kilogram of beef.

Chris Brett, Olam’s senior vice president and head of corporate social responsibility and sustainability, said the company tries to blend business success with wider social goals.

“We are one of the few businesses investing in rural environments and am tackling the problem of urbanization,” said Brett in Olam’s London office – the company’s global headquarters is in Singapore.

In 2008, it won the World Business Development Award for its contribution to achieving the Millennium Development Goals (MDGs) (http://www.un.org/millenniumgoals/).

Olam also has been recognized for its contribution to global food security. By providing farmers with credit to help build their communities, it has also been able to revive declining rural economies and help stem the outflow of farmers to the big cities and urban slums.

“Many countries are afraid to lend to farmers,” Brett said. “We gather the farmers together in groups of 500 and Olam manages the loan while a local bank receives the money. Defaults have been low and farmers are building up a credit rating. In this way, farming becomes a business not just a subsistence existence.”

The dramatic changes taking place in African countries – especially rapid urbanization that has made the continent home to 25 of the world’s fastest growing cities (International Institute for Environment and Development) – means there is an urgent need to increase food production and stabilize rural economies to support farming.

Olam International, started in 1989 in Nigeria by its India-born CEO Sonny George Verghese has many lessons for any Southern entrepreneurs who have their sights set high.

After developing its skills in exporting cashew nuts from Nigeria, Olam moved into cotton, cocoa and sheanuts. From 1993 to 1995, the company explored ways of taking their skills into other countries and different products. It was a period of rapid expansion into other African countries including Benin, Togo, Ghana, Cote d’Ivoire, Burkina Faso and Senegal.

Olam now operates in 26 African countries.

There has been a renaissance in South-South trade in recent years before the current economic crisis, growing by an average of 13 percent per year between 1995 and 2007. By 2007, South-South trade made up 20 percent of world trade.

Olam started with one product, got its supply right, and then started looking around and seeing what other products and services it could offer, applying already-tested expertise and supply skills – what the company calls the ‘Olam DNA’.

Olam claims its success has come from building strong relationships with farmers to guarantee high standards for the food products. The company does this by tightly tracking its stock and its quality. Olam then uses the information to analyze risks to the supply network. The company also keeps both warehouses and field managers close to the farmers. Olam estimates 65 percent of its profit comes from managing the journey from farmer’s field to factory gate.

Its selling point to customers is the ability to guarantee the entire journey from farmer’s field to factory gate, taking on all the risk and stress for ensuring the product is of the right standard and delivered on time.

Its niche is to provide the food products required by some of the world’s top food brands. The company has grown from just one product in Nigeria and two employees in 1989, to directly employing over 10,000 people worldwide and supplying 20 products in 60 countries, according to Brett. He says the company, which had a total 2008 turnover of US $5.75 billion, was “born out of Africa.”

Brett says the company is now “investing heavily in Africa in processing and distribution centres” – proof that a success story feeds back into more success and investment. It has been able to use its profits to go back and buy up failing businesses and former state-run enterprises, and modernize them. Olam now grows the food, processes it, and transports it to market.

Olam actively works with international donors, global NGOs like Technoserve (farmer business development), WWF (environmental impact of supply chain), and the Bill and Melinda Gates Foundation (cocoa and cashew farmers).

Olam, however, has received criticisms for its past practices. The global environmental group Greenpeace attacked its logging in the Democratic Republic of Congo (DRC) (http://www.greenpeace.org.uk/tags/olam), and the International Finance Corporation (IFC) divested its holdings from Olam for it trading illegally cut timber.

Olam and the Gates Foundation project are working with 200,000 cocoa farmers in West Africa to double their incomes. In Ghana, cocoa farming has become synonymous with poverty and perceived as an occupation of last resort. The work force is rapidly aging and the industry will die out if it doesn’t become more profitable and attractive to young people.

“We want the farmers to be profitable, the transporters to be profitable,” Brett said. “We believe a supply chain does not work if one player takes too much.”

And what advice does Olam have for budding food producers and growers? “Catchy, simple brands work. Our Mama Mia pasta caught the wave of the Abba revival.”

“Our Tasty Tom brand became very popular in Africa so we extended the brand into other products than just tomato paste. You reduce the cost of advertising by extending the brand name.”

“We feel SMEs (small, medium enterprises) growth is critical because it would give us more support. If more people invested in SMEs, we would have more people to do business with. We want to be able to make deals: they could be entrepreneurs.

“If you can add extra value it costs nothing but time.”

Brett advises budding SMEs: “It’s all about quality: trust and shared business ethics like formal contracts. When you have those, the bigger brands will give you support.”

By David South, Development Challenges, South-South Solutions

Published: October 2009

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP’s South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South’s innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

Follow @SouthSouth1

Google Books: https://books.google.co.uk/books?id=tRKYBgAAQBAJ&dq=development+challenges+october+2009&source=gbs_navlinks_s

Slideshare: http://www.slideshare.net/DavidSouth1/development-challengessouthsouthsolutionsoctober2009issue

Southern Innovator Issue 1: https://books.google.co.uk/books?id=Q1O54YSE2BgC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 2: https://books.google.co.uk/books?id=Ty0N969dcssC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 3: https://books.google.co.uk/books?id=AQNt4YmhZagC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 4: https://books.google.co.uk/books?id=9T_n2tA7l4EC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 5: https://books.google.co.uk/books?id=6ILdAgAAQBAJ&dq=southern+innovator&source=gbs_navlinks_s

Creative Commons License

This work is licensed under a
Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

ORCID iD: https://orcid.org/0000-0001-5311-1052.

© David South Consulting 2021

Categories
Archive Blogroll

African Fashion’s Growing Global Marketplace Profile

By David South, Development Challenges, South-South Solutions

New UNOSSC banner Dev Cha 2013

SOUTH-SOUTH CASE STUDY 

Tales of African global fashion successes have multiplied in the last few years. African fashion is seeing its profile rise as more and more shows and festivals boost awareness of the continent’s designs, designers and models. In turn, African fashion and design is being taken more seriously as an income and job generator, and as a sector able to weather the ups and downs of the global economy: people always need to wear clothes.

If the global fashion industry were a country, it would rank 7th in global GDP (gross domestic product) (Fashion Performance Network).

In 2011, the apparel retail industry was worth an estimated US $1.1 trillion, and that could grow to US $1.3 trillion by 2016. And the sector is expanding in the global South. It is forecast that India and China combined will be as big a fashion market as the United States by 2015.

One visible aspect of this is the plethora of African fashion weeks that have sprung up.

Launched in 2011, African Fashion Week in London (africafashionweeklondon.com), or AFWL, is a reflection of how far things have come and how much higher the profile of African fashion now is.

The mission behind AFWL is “to promote emerging and established African designers and African-inspired designers from across the globe.” The number of attendees grew from 4,700 in the first year to 20,000 in 2012.

In 2012 it partnered with Côte d’Ivoire Fashion Week (https://www.facebook.com/pages/Cote-dIvoire-Fashion-Week/364950310210789), which will hold its third annual event in December 2013. This partnership has meant fashion designers from Côte d’Ivoire can benefit from the higher international profile of appearing at African Fashion Week in London. The theme in 2012 was “Ivorian Textile Products on the American Market.”

“London is one of the most important fashion capitals around the world,” said Côte d’Ivoire Fashion Week’s founder and CEO, Coulibaly Severin on the AFWL website. “It is a great honour for us and the African continent to have a professional international platform to promote African Fashion industry actors, African heritage, African values, African textiles through Africa Fashion Week London.”

The idea is to use the fashion week as a bridge to access the European market.

With the right support, African fashion businesses have huge potential for growth.

A distinctive “Afropolitan” aesthetic (http://afropolitanaesthetic.tumblr.com/) has grown as a phenomenon since 2005, influencing global urban design trends. It can be characterized as urban, sophisticated, tailored and boldly African in its use of colours and patterns. British designer Paul Smith (http://www.paulsmith.co.uk/uk-en/shop/) has been one of many designers to be inspired by the afropolitan look.

While African fashion trends have always influenced the global fashion business, the challenge has been to create viable global African fashion brands that can compete in the global marketplace and in turn create sustainable jobs in Africa.

Pioneers are showing that it can be done.

Featured at Africa Fashion Week in London in 2011, the Nigerian fashion brand Mmabon (mmabon.com) is now looking to pioneer new ways to buy and sell clothing in Africa. The company, which sells affordable casual and custom apparel, is launching a mobile phone app for all devices and is building its own Internet e-commerce website as well. Mmabon had been engaging with customers through Facebook and the BlackBerry smartphone, but realized it could offer a much better experience for customers through an app and an e-commerce website. This shows the future for fashion in Africa is going mobile and going online.

Founded by Elizabeth Idem-Ido, Mmabon is capitalizing on the fact Internet access is improving in Nigeria and is turning to online advertising to drum up customers. The fashion brand is trying to reach 16 to 34 year olds, of which 8 million are believed to be currently on Facebook in Nigeria, according to Idem-Ido.

There is a cultural change underway in the country: people are increasingly feeling comfortable doing commerce online and on mobile phones.

“Nigerian youths are now more willing to buy products over the Internet, unlike five years ago, with the likes of konga.com and jumia.com revolutionizing the online retail scene in Nigeria,” Idem-Ido, who is also a trained lawyer, told VC4Africa (https://vc4africa.biz/).

Konga (Konga.com) is Nigeria’s largest online mall. Opened in 2012, it offers a wide range of products for order across Nigeria. Jumia.com calls itself the “the biggest online shopping mall in Africa”, operating in Morocco, Egypt, Ivory Coast, Nigeria and Kenya. Another player is Ecwid (ecwid.com), which bills itself as an e-commerce solution for small businesses that “is a revolutionary shopping cart that seamlessly integrates with your existing website. It can also be added to your page on social media networks, such as Facebook or mySpace”.

Idem-Ido’s experience with Mmabon over the past two years shows how online marketing can be an effective – and cost-effective – way to broaden a company’s customer base.

“As a business, we have not physically met with 80 per cent of our current customers,” she said. “Orders have been achieved from referrals, BlackBerry Messenger contacts and our official Facebook page. Online marketing improves our visibility without owning a prime-location store and reminds, assures our already existing customers on why we are their preferred brand.”

Her fashion business began humbly as a part-time t-shirt printing hobby for her friends. Then people started ordering custom-designed t-shirts, and so she began a journey exploring fabrics in local and foreign markets.

Mmabon is now the official merchandiser for the Calabar Festival 2013-2015 (calabarfestival.com), the biggest street carnival in West Africa. Taking place in Calabar, Cross River State, Nigeria, it attracts a million people.

Mmabon is receiving help from Venture Capital for Africa, or VC4Africa (https://vc4africa.biz/), a community of entrepreneurs and investors helping to build companies in Africa, to raise further investment to grow the brand and the business.

Another success benefiting from international exposure is Malian designer Boubacar Doumbia (http://www.ndomo.net/english/index.html), who is currently making fabrics for design-savvy British furniture and home furnishings store Habitat. The prints with African themes have proven a hit with Habitat customers.

Working from a new studio in Burkina Faso’s capital, Ouagadougou, Doumbia (https://www.ashoka.org/fellow/boubacar-doumbia) is a leading advocate of bogolan (http://www.malimali.org/what-is-bogolan/), a Malian traditional textile dyeing process using mud.

He uses locally grown cotton, which is first dyed using plant-based dyes. A chemical reaction occurs when the iron in the mud is applied to the fabric and turns the existing plant dye black after three applications, or grey after two applications. The mud is washed off and the fabrics are placed in the sun to dry. It is a sustainable and chemical-free approach to dyeing fabrics and also creates vibrant patterns that have caught the attention of people in Europe and elsewhere.

Other outlets who have become enamored with African patterns and themes in Britain include Darkroom Boutique, House of Fraser and the V&A Museum, The Guardian newspaper reported.

As an Ashoka fellow (ashoka.org) – Ashoka is the largest network of social entrepreneurs worldwide – Boubacar is using the craft as a way to boost skills and opportunities for youth in Mali. He has “overhauled the traditional model of youth apprenticeship in Mali by putting young people in a central, entrepreneurial role from the outset. Rather than simply train students in the methods of textile production, he teaches professional, people and life skills, and encourages his apprentices to become self-sufficient, creative, and innovative”, according to the Ashoka website.

Elsewhere, African fashion style pioneer Gilles Belinga (https://www.facebook.com/GillesBelinga) has become a fashion phenomenon in China. The former communications engineering student had a deeply personal conversion to fashion and style upon arriving in Beijing; the buzzing and vibrant Chinese capital captured his heart.

“I discovered my talent and passion for fashion in China,” he told China Daily.

“I’ve also been given many opportunities here, so I want to pursue my fashion dream in China.”

The Cameroon native has a distinctly afropolitan take on fashion – elegant, tailored suits, strong colours, and a gentleman’s manner – and this fashionable posture landed him modeling work in fashion shows.

He arrived in China in 2008 after his parents divorced and he went from being in a wealthy family back home to having to do any job he could get to survive. He started out in Tianjin, China – an industrial city with a large high-technology sector – and then moved to Beijing to study.

It was there that he fell in love with the city’s fashion scene and hasn’t looked back.

“I never attended fashion school in Africa, but in Beijing, in this fashionable environment I realized that I like drawing clothes, matching colors and mixing fabrics,” he said.

“There are so many fabrics here, which has given me the chance to try out different things. Sometimes you might have a talent in you, but you might not discover that talent if you’re not in a place where it can come out.”

He now designs clothes and has them made by local tailors.

“When I design clothes for clients, I look at the whole person and what kind of message they want to deliver to people,” he said. “Then I check their skin color and think about style and fabric.”

He defies the elitist take on fashion that can be promulgated by fashion magazines and thinks good fashion is for everyone.

“I believe the way you dress sends a message to people about how you want them to think about you.”

He finds Beijing is full of opportunities and he is regularly stopped in the city’s trendy Sanlitun (http://en.wikipedia.org/wiki/Sanlitun) neighbourhood and asked to be in fashion shows.

“In China, you don’t know who you are going to meet. You could be anywhere and meet someone who can change your life.”

And he plans to perfect his skills and designs in China and then take them back to Cameroon one day.

And maybe, in time, Belinga will be the next big fashion thing.

Resources

1) African Fashion Week London: AFWL celebrates London’s unique and diverse cultural heritage, topped with the flamboyant mixing of Western and African culture through fashion at the same time promoting Africa’s rich ethnic culture and interpreting it into contemporary designs. Website: africafashionweeklondon.com

2) Gentlemen of Bacongo by Daniele Tamagni, Paul Smith and Paul Goodwin, Publisher: Trolley. Website: amazon.com

The Afropolitan: A magazine and website from South Africa packed with content from an afropolitan perspective. Website: afropolitan.co.za/

Association of African Designers in Diaspora: The Association of African Designers in the Diaspora is the non-profit social enterprise arm of Africa Fashion Week London that supports emerging designers with the aim to make a positive contribution to society through fashion and creativity. Website: http://africafashionweeklondon.com/africafashionweek/association-of-african-designers-in-diaspora/

The Creative Economy: How People Make Money From Ideas by John Howkins, Publisher: Penguin. Website: creativeeconomy.com/book.htm

Creative Economy Report Website: This annual report offers a snapshot of the state of the global creative economy and its key trends. Website: http://unctad.org/en/Pages/Publications/Creative-Economy-Report-%28Series%29.aspx

7) Copyright + Creativity = Jobs and Economic Growth: WIPO Studies on the Economic Contribution of the Copyright Industries (WIPO 2012). Website: http://www.ip-watch.org/weblog/wp-content/uploads/2012/02/WIPO-Copyright-Economic-Contribution-Analysis-2012-FINAL-230-2.pdf

8) The Afropolitan Shop: The Afropolitan Shop is an online boutique founded by Beverly Lwenya, that desires to tell an African Design Story. It began as a blog in 2007 called The Afropolitan Network, which highlighted stories and images of the African Diaspora. The Afropolitan Shop is now a growing global brand, specializing in handmade and designer accessories such as jewelry, bags and shoes. Website: theafropolitanshop.com/

Published: October 2013


This work is licensed under a Creative Commons Attribution 4.0 International License.

ORCID iD: https://orcid.org/0000-0001-5311-1052.

© David South Consulting 2021

Categories
Archive Blogroll

Afropolitan: African Fashion Scene Bursting with Energy

By David South, Development Challenges, South-South Solutions

ISSN 2227-3905

SOUTH-SOUTH CASE STUDY

Fashion is a significant global business: some estimates place the world’s clothing industry at US $900 billion a year. Clothing – like food – is something everyone requires, so fashion can be an accessible way for small-scale entrepreneurs and craftspeople to earn income and eventually tap into larger marketplaces. Through clever use of the internet and online shopping, small-scale fashion designers and clothing makers can access global markets and earn income from around the world. Initiatives like ShopAfrica53 (http://www.shopafrica53.com/) are helping people to get online and establish small web shops.

The Democratic Republic of Congo is the size of western Europe. A bitter, decade-long civil war that officially ended in the rest of the country in 2003, and that has claimed several million lives through fighting and disease, still burns on in the eastern border provinces of Ituri, North Kivu and South Kivu. As a result, Congo is now home to the world’s largest UN peacekeeping mission.

In the face of this civil strife, a group of very fashionable gentlemen bring colour and style to the country while also pioneering a way to make money and improve standards of dress in the country. Members of “La sape,” or La Societe des Ambianceurs et Personnes Elegantes (http://fr.wikipedia.org/wiki/Société_des_ambianceurs_et_des_personnes_élégantes) — the society of tastemakers and elegant people — wear designer fashions either bought in Europe, or handmade in Congo.

They are inspired by Paris’s society world of parties, social events and fashion as they see it in magazines. It is a hybrid style: French colonialism (the Congo is a former French colony) mixed with individual interpretations of the in ‘look’.

All in the last place in the world you would expect to find such cutting-edge fashion: a place where slums and warfare are the everyday norm.

The gentlement of La Sape are featured in the new book Gentlemen of Bacongo (http://www.trolleybooks.com/bookSingle.php?bookId=118) by photographer Daniele Tamagni. He chronicles in loving detail this bright fashion phenomenon. The cover of the book features a man in an elegantly tailored lipstick pink suit and pink bowler hat – testament to the eye-catching styles on display.

But rather than a local fancy, the look refined by these gentlemen has become the inspiration for designers in Europe, like Britain’s Paul Smith (http://www.paulsmith.co.uk/).

“A Congolese sapeur is a happy man even if he does not eat, because wearing proper clothes feeds the soul and gives pleasure to the body,” Tamagni said.

They also are the living embodiment of a distinctive modern African style.

Their suits are either designer or handmade copies. The sapeurs have strict rules to go with their style: never wear more than three colours together for example.

Tamagni says there is more to the phenomenon than just appearances. Sapeur Salvador Hassan “thinks that a real sapeur needs to be cultivated and speak fluently, but also have a solid moral ethic: that means beyond the appearance and vanity of smart, expensive clothing there is the moral nobility of the individual.”

Says Hassan, “The label is not important, what is important is to be able to dress depending on the taste of the individual.”

For a sapeur, the saints are Pierre Cardin, Roberto Cavalli, Dior, Fendi, Gaultier, Gucci, Issey Miyake, Prada, Yves Saint Laurent, Versace and Yohji Yamamoto.

Unlike the followers of some other fashion styles, they do not worship violence and gang warfare.

Some find the clothes in shops in Brazzaville and Kinshasa but most try to get them from Paris.

So how do they afford these clothes that sometimes cost in the thousands when most are unemployed? They have turned their passion for fashion into a business too. They rent the clothes out for around US $25 a day to earn income. They also save their money to travel back and forth to Europe selecting the best clothes, which they then carry back to Congo and sell for a good profit.

In another development, African fashion magazines are also playing their role in shifting perceptions.

The African look has attracted a new wave of magazines to capture it and promote it. The new glossy magazine titles – Arise (http://www.arisemagazine.net/) (published in London), HauTe (http://www.fashionafrica.com/), Helm (http://www.facebook.com/pages/HELM-Magazine/41931572531) and True Love – are good examples of this new wave.

“Honestly, upwardly mobile African readers are crying out for this magazine,” Helen Jennings, editor of Arise, told the New York Times. Arise is a Nigerian style monthly started by Nigerian media mogul Nduka Obaigbena, who also publishes Nigeria’s leading newspaper, This Day.

“Because the local magazines aren’t as high-end or progressive, and no other international titles speak directly to an African readership, Arise has really caused a stir,” said Jennings.

Jennings calls the magazine’s mix of content “afropolitan”: blending pan-African and global content.

The magazine’s debut issue features the models Alek Wek, Naomi Campbell and Liya Kebede. Stories run the gamut from electronic music to football academies, and the rise of Nollywood, Nigeria’s home-grown film industry.

It features African designers and is distributed in seven countries to 60,000 readers.

Along with new magazines, more and more African designers are now getting attention on Africa’s – and the world’s – catwalks. They include Lisete Silvandira Bento Pires Pote, who started as a designer in 1998 and has been featured in many fashion shows in Angola and around the world. Her clothes are now worn by singers and actors.

Other Angolan fashion designers include Elisabeth Santos, Vadinho Pina, Tekasala Ma’at Nzinga and Shunnoz Fiel (whose appearance in a World Press Photo is drawing attention to the Angolan fashion scene) (http://www.worldpressphoto.org/index.php?option=com_photogallery&task=view&id=1463&Itemid=224).

From Botswana, Koketso Chiepe has been so successful, she opened a fashion shop in London this past summer. Chrystalix is a Cameroonian fashion designer who uses raw materials found in the Equatorial forests of her country. Another Cameroonian design label is Kreyann and sells from its boutique in Douala clothing made from rich materials like silk.

In Ghana, young pioneer Aisha Obuobi has revitalized the use of African prints in fashion (http://www.youtube.com/watch?v=0M2rEQ0Wehw).

A list of fashion weeks across the global South (http://en.wikipedia.org/wiki/Fashion_week) offers many opportunities to witness this creative surge across the continent.

Resources

Creative Commons License

This work is licensed under a
Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 

ORCID iD: https://orcid.org/0000-0001-5311-1052.

© David South Consulting 2021