The competition among the players in the nation’s cement market to deepen their penetration has become a blessing for distributors and retailers, who now enjoy promotions and partnership rewards, Raheem Akingbolu reports
Scores of distributors of BUA Cement celebrated the yuletide period in affluence, thanks to the management of the company that saw the period as an appropriate time to reward customers’ loyalty. At an event held in Abuja recently, the company doled out gifts; including three brand new Prado SUV, five Hyundai Sonata cars and huge sum of money to reward its distributors.
Giving the fact that the competition for leadership in the sector is among the toughest in the market, the event didn’t come as a surprise. In a country, where many players are making efforts to appeal to customers, cutting edge strategies are daily being put in place to sustain strength. As at the last count, about eight names are making efforts to have substantial share of the market. But of these names, BUA, Lafarge Africa Plc.and Dangote cement are in the forefront while Ashaka, UNICEM Cement Company and the Cement Company of Northern Nigeria (CCNN), dominate their respective regions. It is difficult to write-off the smaller players because they have in a way, turned the nation’s infrastructural deficiency, which brought about high haulage costs, into an advantage.
Players in this level are closer to consumers in their domain than the bigger ones that cut across the geo-political zones.
To meet the country’s infrastructure needs, the sector is growing faster than it was a few years ago. The bigger cement companies are beginning to think out of the box to consolidate on their strength. Despite their huge investment in technology, they are bonding more with consumers through advertising and other marketing tool. Last year, the industry embraced promotion to reward customers, who are loyal to their products. To cap it up, distributors of the various brands are being rewarded annually for their contribution to the growth
Unlike the competition in the Fast Moving Consumer Goods Industry (FMCG), which is easily noticed by an average person on the streets, trade partners and stakeholders are the main people who feel what happen in the cement sector. According to a business analyst, Mr. Wale Okoya, this is one of the reasons why the top players in the market invest more in business expansion and servicing of their marketing channels.
“Obviously, no sector of the economy can do without advertising and other elements of marketing but one of the major things a manufacturer should consider is how to win the confidence of its trade partners. The partners, especially the distributors, should be able to know if the company they are dealing with has the capacity to meet consumers’ demand, both in terms of quality and products availability,” he said.
According to Okoya, this informs the various developments at BUA, which has in the recent years embarked on a series of strategic acquisitions which has seen its business portfolio expand. Such acquisition includes; the Cement Company of Northern Nigeria (CCNN), Edo/OBU Cement, BUA Flour Mills, BUA Sugar Refinery, BUA Pasta, BUA Ports and Terminals, and BUA Estates amongst other agribusiness holdings.
As at the time the company entered, trading was quiet different in the country, compared to now. It was very difficult, because access to funding and foreign exchange were both very challenging. However, it was also quite lucrative as not many companies were able to compete. This is where BUA got it right. The fact that it chose to participate early is believed to have assisted the company in starting its manufacturing concerns.
The first of these business initiatives was to set up a flour plant in Lagos, driven by huge demand for flour. At the moment, the company has the flour mills, the pasta plants, a sugar refinery in Lagos and the vegetable oil processing mills and the cement projects that will soon be inaugurated in Port Harcourt. Just recently, the company started production of cement from its three million metric tons per annum cement plant in OBU, Okpella, Edo State.
2016 edition of BUA’s distributors’ award
Of all the tools in its marketing kit, maintaining good relationship with trade partners appear more important to the promoters of BUA Cement. In the last few years, the company has not only used its annual reward for distributors to strengthen relationship with them but has used it to win more patrons.
To the cement manufacturing company, the common saying that ‘Customer is King’ has become a watchword, with which it connects distributors. This was demonstrated recently in Lagos, where outstanding distributors for the year 2015, were appreciated for their patronage and unwavering loyalty over the years.
The award ceremony, which was designed to appreciate the support enjoyed by the company from its numerous distributors nationwide, also created a platform for stakeholders to network.
Expressing the company’s appreciation to its trade partners for the relentless contributions over the years, the Group Executive Chairman/Chief Executive Officer, Alhaji Abdulsamad Rabiu, described the awards as a demonstration of the company’s commitment to constant appreciation of customers who had kept faith with it, even in the face of challenges.
He explained that besides being a reward scheme for its customers, the awards would also go a long way in further strengthening the relationship between the company and its trade partners.
The chairman reiterated that the reason behind the annual customer awards was to express the company’s gratitude to the distributors for their support for the growth of Lafarge Africa business in Nigeria.
”This evening is not just about the good food, networking and beautiful dresses but it is an acknowledgement of a solid partnership that works. It is our little way of celebrating you for constantly being with us through the years to this point. You have been a constant in our business – partnering with us every step of the way and contributing immensely to the success of BUA Cement.
Your loyalty to the brand, your feedback on areas to improve and most importantly, the service you render to the end-users has helped us to maintain an enviable position in the cement industry. As such, we say a big “thank you”
He also used the opportunity to appreciate the company’s dedicated and professional workforce – from the management sales staff and technical staff at factories, saying their contribution has helped the brand to remain the King of Cement in Nigeria.
To boost sales, he explained that through an expansion drive that would span across its production plants, the firm would double its production capacity.
He said distributors who performed well would be rewarded with cash, cars and other prizes, adding that the group planned to increase its market share and penetration through efficient service delivery and operational framework.
Defending the price of the commodity, Rabiu explained that the price of the commodity is cheap when compared with other African countries, especially with the declining value of Naira, adding that cement production is a challenging business.
He, however, noted that despite the harsh operating environment, the company would continue to meet the aspirations of its stakeholders
He said: “We have embarked on an expansion drive and this will be completed in 2018. Cement business is a very challenging one, because it is a capital intensive business; but I want to assure you that our expansion project will be completed by the end of next year or at the beginning of 2018.”
Presenting the gifts to the distributors, Rabiu said: “This award is our little way of celebrating you as you have been with us constantly throughout the year. Your loyalty to the brand has helped us to grow and we will continue to celebrate customers who have been there in this period of economic crisis.”
At the award this year in Abuja, which was attended by numerous distributors across the country, about 50 trade partners were rewarded with various prizes including cars and cash prizes. To give the awardees a royal treatment, they were brought to the FCT and accommodated at Sheraton Hotels.
Three distributors; ICO Odigwe and Sons Nigeria Limited, Ramiyu Milk Resource and Martha Edward Enterprises were cynosure of all eyes as they All smiled home with 2016 Prado SUV, N12 million naira, 11 million naira and 8 million naira respectively. Other distributors also went home with either cars and cash prizes.
In his remarks after the ceremony, Group Head, Corporate Communications BUA Group, Mr. O’tega Ogra explained that the award, which was put together to recognise customers’ loyalty and volume performance for last year, was also designed to encourage the company’s customers to extend their frontiers in the market.
“We look at their performance versus our expectations and on that basis we reward those who have outstanding or exceptional performance. Our aim is to motivate them to better assist us in meeting what the market expects from us. Our distributors are important in making us achieve our corporate objectives and also in making our end users achieve their goals,” he said.
Speaking further, he said it is always very good to compliment the efforts of business partners, adding that their support is important when it comes to their ability to effectively cover the targeted market.
Strength of BUA brand
Like few Nigerian brands that have become household names in the market, BUA Group had entered the market about three decades ago, as a trading company but with the ambition of becoming a solid brand that would command respect in many sectors. From day one, its handlers were able to know early enough that branding was much more than just a cool logo or well-placed advertisement.
Promoters of the BUA Group followed a simple rule of branding; they started small with their branding and didn’t forget to focus on their target niche and audience first. They also craft a clear expression of what their company was most passionate about.
This obviously explains why they entered the market as a trading company, majorly dealing in rice, cement and flour importation. Within a short time, the group turned to a major integrated manufacturer of these products locally and started creating thousands of jobs for Nigerians. Since consumers are always quick to identify with brands they can trust, BUA became a respected brand in many sectors. Today, the brand can be defined by many positive attributes.
Apart from taking BUA from strength-to-strength by contributing enormously to the growth of the Nigerian economy, the management of the company has worked very well in line with government specifications, to promote global practice in the country.