The Managing Director of Procter & Gamble, Mr. Adil Farhat, in this interview, talks about his company’s footprints in Nigeria. Kasie Abone presents the excerpts:
When you were appointed the Managing Director, your Vice President, Sub-Saharan Africa, said you will bring fresh ideas and innovative approach that will enhance and revamp P&G Nigeria’s operations and its sustainability. One year down the line how far have you been able to bring all these qualities to bear?
P&G has been operating in Nigeria for over 27 years. Our commitment to Nigeria is very strong and long term. Every year we have a business cycle which ensures we continue to invest and grow in the country. Based on that, after my appointment I made sure we followed both strategies; which is continue to invest and continue to grow in Nigeria and also to increase our footprints. I think we have made progress in terms of increasing the footprint of our products. We have gone into new products in our existing portfolio like Always sanitary pad.
You might have noticed the Always soft launch which is a better priced product for Nigerian consumers.
Similarly, we have introduced newer products portfolio in Nigeria as well. We are the first company in Nigeria to introduce Diaper pants and Pampers pant portfolio. So I think in regards to our investment in Nigeria and diverse footprint we have made through reassuring progress we made last year.
At the same time from our golden market stand point we continue to invest, we continue to partner with more distributors to make sure that our products reach more shoppers and consumers in more parts of the country.
Can you give us an overview of the current developments and possible challenges in the Nigerian personal hygiene market considering the present economic realities?
I think our portfolios are very well placed to serve across multiple categories of consumers in Nigeria. We have the diaper brand in Pampers for babies. We have the Always pad brands which cater for young girls who are just about to enter into puberty. I will talk about the work we are doing with this brand, some great works that our team is leading with some of our partners in Nigeria, especially MercyCorp, a Non-Governmental Organisation (NGOs).
Then, we have Gillette which is a global shave care leader, Oral-B and Ariel our globally renowned tooth paste and detergent brands in Nigeria.
So we have six leading world class brands in Nigeria. Our footprint is quite broad; and if you talk specifically about Pampers and Always; Always has continued to invest in ensuring that we continue to give priority to hygiene in healthcare for young girls in Nigeria.
For not having proper access to pads young girls lose up to five to seven days a month in school when their period starts, and I think that is a critical age that has a lot of impact and confidence as they grow up. Always stepped in with a school program and plays a big role in keeping those girls in school, making sure they learnt about personal health and hygiene earlier on in their lives, and using that information to overcome the confidence break they need, to become more confident and stronger individuals.
Nigeria has a high demand for personal hygiene products, as a result of its huge population which has necessitated influx of foreign products. What is the nature of competition amongst niche players and major players like your company?
Nigeria is a big market, so the category size is bigger and what we generally believe is that healthy competition is always good, the more quality players, quality supplies are available in the market, the bigger the category and faster the categories grows which specifically means that the access to these products is increasing and getting to more people in the country.
How tough is the operational environment and how does P&G navigate the challenges and still stay afloat?
We have been in the country for 27 years now and we are very committed to the country. We will be here for a very long time. We have two manufacturing facilities in Nigeria, one in Ibadan and another in Lagos. We will continue to look for other opportunities to invest in the country.
Our experience of 27 years has also made us ready to better understand the economics and dynamics of the country and I think that time spent in the country makes us better prepared for the future as well. There is always room for improvement, but the key is to remain committed to the country, work with government and with relevant stakeholders to continue to improve the ease of doing business and other issues regarding investment in the country and take a longer view of the investments in the country to ensure that along with the government we remain committed to the country.
How competitive is P&G in the face of influx of competing substandard products, both local and imported, including sourcing your materials?
Backward integration drive is something that we are being intentional about. Ideally, we like to source all our materials locally as much as possible, and continue to make improvements every year. We will continue to work with suppliers. What we do every year is meet and work with our suppliers on capacity development as well as across the categories to ensure more of our materials are sourced locally in Nigeria as the government continues to help us make the conditions favourable. There are some of the conditions as well which we are working on with the government, such as the Value Added Tax (VAT) which is one we are working with the government to make the products more accessible. I think backward integration is very intentional as far as our strategy is concerned. P&G is one of the leading investors in Nigeria; I think government at all times has worked well with us in terms of making sure there is a level playing field as far as the polity is concerned.
What is the percentage input of local raw materials?
In our Ariel brand we are manufacturing in Ibadan right now, we have 100 per cent packaging materials sourced locally. At the last manufacturers’ exhibition that we had, we shared our localisation journey. Presently, we are also trying to source other ingredients locally. That is why we continue to host our suppliers, even with the Manufacturers Association of Nigeria and the Ministry of Trade and Investment, to see how our suppliers can access those raw materials. So, we continue to engage them but there are some raw materials we cannot source locally. But currently over 60 per cent components are sourced locally and presently 100 per cent packaging materials. That is why we are still importing some and still engaging our suppliers to see how they can produce them locally.
What are the untapped opportunities your company could be moving into in the short to medium term?
Nigeria is a country that offers tremendous opportunities, globally our company operates in 10 categories across 60 brands and we continue to look into opportunities and how we can tap into that portfolio. So, locally we continue to look towards the brands that we sell. We have the Always ultra business, we have now moved into Always Soft business as well, where we produce Pampers pants. We expanded our Gillette portfolio recently where we will continue to sell fusion razors up to double edge razors, Oral-B as well and other categories. Within these portfolios we continue to look for opportunities as we go forward.
You have been in other markets before coming to Nigeria, can you compare these markets with what obtains in Nigeria, and how are your brands doing visa-vis Nigeria market and others?
One way to compare these markets is to have an idea of how the categories are developing vis-a-vis our products. One challenging thing in markets like Nigeria’s is that we need to invest enough with programs like Always Keeping Girls in School AKGS), Pampers Hospital Education, and Oral-B Doctors on Wheel. We make sure the category goes as deep as possible in terms of usage so that more people get access to better sanitary pads, diapers and paste. I think one other thing that differentiates Nigerian market from some other market like Europe for example; the categories are more developed so more people have access. We need to go in same way in Nigeria in order to access more people.
What are your considerations on social investment and how you decide what social investment you embark on?
In P&G we really try to make a difference and currently we focus on Sustainable Development Goals (SDGs). We are presently playing in six categories highlighted by the SDGs. We are currently working on gender equality, provision of access to clean water, diversity and inclusion, community impact and some other projects we are working on, but through that we have programs that we are running within that. We are focused on gender equality; we are trying to impact more girls through our brand programs, even through our advertising and into social programs that we initiate locally.
We target marginalised girls, empower them. We also have the supplier and diversity program where we are giving deliberately. We want to give business to rural women and we are training them on how to keep a sustainable business. We recently signed an Memorandum of Understanding (MoU) with the Ministry of Industry Trade and Investment to also broker the ability of entrepreneurs which is the community impact pack we are very committed to growing in Nigeria, and growing the economy as well, and that is why we are engaging in such projects.
You recently concluded the AKGS, I want to believe that is one of the ways you get your products deeper into the market, can you throw more light on the program?
Absolutely, as earlier said, we are continuing in making sure that we pass on all the information to persons who have been handling young girls, that is why we have a school program in partnership with Mercycorp. The idea of the program is to make sure that in Nigeria we help keep those girls in school as much as possible and continue to make sure they have the confidence they would have had if they had not been in the puberty stage, and associated issues related to it.
You keep mentioning MercyCorp, Why the choice of MercyCorp, explain their role in this program?
We have the AKGS program which is our brand program, apart from the brand trial the key benefit of the Always brand program is that the girls take lecture on health and hygiene management, they are also tutored on confidence and all of that. The partnership with MercyCorp was fantastic because MercyCorp has been in Nigeria running programs for girls for over five years now. They are going deep into marginalised communities, educating girls on how to take care of themselves, the steps to boost their confidence and talk about menstruation, their approach was fantastic because we already had an Always Program and that is where the AKGS program was aligned to meet the needs of these girls for a stretched period of time which is 18 months when it focused on 29 schools to grow their (girls) capabilities, and tutored them on health and hygiene management, gave them pads and also provided counselling for their extended network which is their family members and other community members as well.
Going forward what do you have for Nigerians in terms of investment?
Like I said we are very committed to Nigeria. We look towards Nigeria as a country with tremendous opportunities, so we will look at the future with a lot of positivity and commitment.
P&G invested about N300million in its plants, how has contributed to boost your capacity?
The objective that we have is making sure that we serve more consumers in more parts of the country more completely. I think that is the objective that we have. I think we remain committed to that objective by ensuring that our products are available across regions to as many people as possible and that will continue every year.