Mirchandani: Nigeria Can Grow to Replace All Imports with Locally Manufactured Goods


Sona Agro Allied Foods Limited, a leading biscuit manufacturing company and subsidiary arm of Sona Group of Industries has commenced exportation of its premium biscuits to Ghana and other West African countries, with over 90 per cent of its raw materials sourced locally. At the recent inauguration of its export order by Ogun State Governor Ibikunle Amosun at its headquarters in Sango Ota, the Chairman of the company, Mr. Arjan Mirchandani spoke to select journalists on various issues. Abimbola Akosile captures his views




What is the significance of the recent inauguration of Sona Agro Allied Foods export order?

We want to manufacture using local materials. This is also to support the Nigerian farmers. We believe they are the future of this country. We also believe that apart from farmers, Nigerians themselves can decide their future. It is not the business of any foreigner to come and decide the future for Nigerians. Foreigners could bring investments, technology and all the talents to make sure goods produced here are comparable to those from Europe and the United States of America, so that at the end of the day one can take the products to other markets not only within Africa but also abroad. It is necessary for us to look at these opportunities.

This is one of the reasons we have for starting this journey based on the use of local raw materials and based on encouraging ourselves towards export. We have started with just two containers for export, which in our eyes, are equal to 200 containers because when one has faith and takes a step at a time, one will reach one’s goal. But it must begin with one step. I am a believer in nature and in God. I believe that everything is possible, but we need determination and commitment. Of course, hard work and commitment are involved in whatever we do. Nigeria has an opportunity to grow and to replace all imports with locally manufactured goods and save foreign exchange. We cannot rely only on oil money. I am encouraged and I believe this is just the beginning.

How will you describe the potential in the biscuit sector and others in the Nigerian market?

We feel very confident. We have been here for some time and we have learnt how to survive. We have learnt to survive in the good times when there is a lot of money and also in the bad times when money is scarce. Hence, we learn new things on a daily basis. Also, Nigeria is a great country; the people are very nice and absolutely hard working. And as long as we are united, we can work together and make this country prosper.

You are heavily involved in the Nigerian business environment; what are the things that drive you as a businessman?

It is God. We are all guided by God. Every step we have taken has been guided by God. We have the faith that you can achieve anything you set out to do through God’s help. It is also our belief that you don’t ask your country what your country will do for you. You ask yourself what you can do for your country.  We make sure that we do our part. We belong to the country and it is important that we play our part.

Many companies are now downsizing and not producing at their installed capacity; how would you describe your own approach to this crisis?

People are downsizing. Maybe, they are unable to get their acts together. Of course, the banks are more difficult because their interest rates are between 20 to 30 per cent. With an interest rate of that nature, no business can survive. In India and other countries, interest rates are two or three per cent or four per cent maximum. In Switzerland, you will get money at one per cent rate. When you have cheap money, you are more encouraged to invest more. We are still expanding. I don’t believe that there is reason to downsize and deny Nigerian workers of their livelihood. There is nothing wrong with Nigerian workers, they are very good. Nigerians are my brothers and sisters and I will say very boldly that I will do whatever it takes to keep our staff. In our companies, we have a very good system and certification from the International Organisation for Standardisation. We have complied with all the regulations from the Standards Organisation of Nigeria (SON), National Agency for Food and Drug Administration and Control (NAFDAC) and other government agencies. We are a responsible company and we are encouraged despite the situation which makes us to be bringing in newer technologies. We are working with the Bank of Industry and the International Institute of Tropical Agriculture (IITA) to achieve this. We are grateful to some of these government agencies because they encourage growth in investments. If the cost of funds is not made cheaper more industries will die in Nigeria. I don’t believe that should mortgage the future of the country. We should encourage local industries that source raw material locally. Nigeria got her independence in 1960, but we are not free until we are free by being self-sufficient. We need to start immediately.

In what ways can the Federal Government of Nigeria encourage investment-friendly individuals like you?

We want the Federal Government to make cheaper loans available for the industries. We also believe that government officials should visit industries more often and encourage them, especially during moments of difficulties. It is the duty of every one of us to join hands together to grow Nigeria. That is why we think the Federal Government needs to directly engage manufacturers on what their problems are. We have written so many letters but we don’t get response from the government and this is very unfortunate. At Sona Group of Companies, we are producing with 100 per cent local raw materials, yet the Federal Government allows people to import commodities that can be sourced locally and they are charged only 5 per cent duties. For instance, some people are importing sorghum when we have enough sorghum in the country. We need to make policies to support local companies.

What are the investment plans and projections for some of your subsidiaries, especially Sona Agro Allied Foods?

At Sona Agro Allied Foods, we’ll like to see 100 per cent capacity utilisation. In the next 15 months, we are hoping to grow by 200 per cent. We feel that import reduction and government’s policies are helping to grow the industries and so automatically, employment will grow and the ordinary Nigerian will be proud that he is contributing to the growth of the economy. We have thousands of vibrant Nigerians in our work force and they are doing well.

What efforts are being made to ensure proper branding of some of your products to make them more reputable in the market?

Great products are made of great quality. If you don’t do quality but you have great packaging, you won’t sell. The customer must get value for his money. Our belief is that people must get value for their money. That is important for us and we have obligation to our customers. We are also not relenting in our efforts to promote the products by building awareness.

In this current period of recession, consumers are buying less because of the rising prices of commodities thereby forcing companies to lower production. In your case, however, you are increasing production. What are you doing differently from the others?

We are not doing anything extraordinary. I am not a magician. I will say God is guiding us to go on the right direction. But one thing I know is that, when you produce quality goods, you don’t have to show off. Consumers themselves will determine what the market of the products should be. If I give you my products and you enjoy using them, then I think you will become my customer. If you buy a product and you are not able to use it, will you buy it a second time? Answer is no!

Which of your subsidiary companies do you regard as the premium or flagship brand and what are the different market shares of your firms?

There is no discrimination in our organisation. Our industry is viable based on availability of local raw materials. I will do whatever it takes to replace imported products. On a daily, basis we put millions of products into the market and we make sure that no problem or complaint comes to us because of our products. And we also pay close attention to our customers because we believe that the customer is always right; so we give them value for their money.

What inspired you to come to Nigeria? How did this dream start?

I am a human being like you and everybody. I am just a servant of God and I will remain a servant of God. Encouragement only comes from God. Look onto Him and ask anything; He will give you in abundance. God is giving us more than enough. I came to Nigeria because I believe in the growth and development of the country. I believe very strongly in the Nigerian project, its people and its potentialities. Nigeria is a great country and with what we are doing at Sona Group, my belief in this country is not wrongly placed.