Kais Mar­zouki, head West and Cen­tral Africa, Nestlé

Ad­mit­ting that the mid­dle-class mir­a­cle it had pre­dicted was fall­ing short, Nestlé cut 15% of its Africa work­force in 2015, but it still sees long-term value on the con­ti­nent

The Africa Report - - CONTENTS - Head of West and Cen­tral Africa, Nestlé Kais Mar­zouki

TAR: How do you tai­lor prod­ucts to places? KAIS MAR­ZOUKI: Tastes, as you can imag­ine, are very lo­cal. The taste of our prod­ucts varies around the world. Maggi stock cubes in Ger­many don’t taste the same as they do in Nige­ria be­cause they are based [in Nige­ria] on fer­mented soy, which is a sta­ple of lo­cal cui­sine. We have all our re­search and devel­op­ment in Abidjan to work with all our brands. Then we have a chal­lenge with vis­ual com­mu­ni­ca­tion. We want nutri­tion to be at the fore­front. Half of our con­sumers don’t know how to read, so we have to ex­plain in a vis­ual way what for­ti­fi­ca­tion in iron means, what vi­ta­min D does to your body, to [help peo­ple to] un­der­stand the ben­e­fits. And then, of course, it needs to be af­ford­able, es­pe­cially with these dif­fi­cult eco­nomic con­di­tions. Many of our con­sumers are liv­ing on $2 a day, so you have to have the right of­fer­ing at the right price point, some­times in smaller serv­ing sizes. What goes hand-in-hand with this is the ca­pa­bil­ity to dis­trib­ute widely. Our trade is ex­tremely frag­mented. You can’t just drop it off at the su­per­mar­kets. We have to make our prod­ucts avail­able in tens of thou­sands of points in the coun­try. And this is day in, day out. It re­quires a big team.

How is that done? What are the ways of get­ting mar­ket in­for­ma­tion about, say, de­mand from a small ru­ral town? We walk the streets to count all the doors, and then we map them to de­ter­mine how we are go­ing to cover it, mostly by third-party dis­trib­u­tors. We em­ploy around 4,500 peo­ple for sell­ing in the streets. They are all en­trepreneurs. They have their push­carts, and they en­able us to reach our con­sumers in a dif­fer­ent way.

Have you been af­fected by cur­rency fluc­tu­a­tions? What are your mit­i­ga­tion mech­a­nisms? The de­pre­ci­a­tion of the naira was, of course, a big event for us last year. This has led to a lack of forex avail­abil­ity in the coun­try, which has put a lot of pres­sure on peo­ple im­port­ing prod­ucts. We were in a good po­si­tion be­cause we are man­u­fac­tur­ing lo­cally. Nev­er­the­less, we have to im­port some raw ma­te­ri­als. We have had for many years a strat­egy of lo­cal sourc­ing of our raw ma­te­ri­als and have got down to a ra­tio of more than 70% sourced lo­cally. We still have to im­port the re­main­ing [share].

What are the most re­silient prod­uct lines? It de­pends how deep down the so­cioe­co­nomic axis you go. For ex­am­ple, there are cer­tain prod­ucts that are not con­sumed by ev­ery per­son ev­ery day. Other things, like Maggi, are in ev­ery pot ev­ery day. So when you are en­trenched in the daily con­sump­tion habits, these are the re­silient ones. The prod­ucts used by the mid­dle and up­per classes, these ones will be less re­silient.

Was it too early for Nestlé to talk of a real mid­dle class in Africa? From our point of view, there is a ris­ing mid­dle class de­spite all the eco­nomic, po­lit­i­cal and so­cial dif­fi­cul­ties. In the past 10 years, ev­ery sin­gle year, these mar­kets have out­per­formed the group’s re­sults in terms of growth. This can only come from the fact that our prod­ucts are con­sumed by the mid­dle class. You just have to look out of the win­dow and you see traf­fic jams be­cause more and more peo­ple have cars.

Do you have ex­pan­sion plans, de­spite the harsh eco­nomic weather? In the past four years we have in­vested over Fr300m ($297.5m) in our re­gion, across dis­tri­bu­tion cen­tres, man­u­fac­tur­ing sites, of­fices and ma­chin­ery, so ob­vi­ously in­vest­ing is some­thing we do con­tin­u­ously, good times or bad. It’s a long-term out­look. We won’t stop in­vest­ing in Côte d’ivoire just be­cause it has one bad year. In­ter­view by

Nicholas Nor­brook

Newspapers in English

Newspapers from Botswana

© PressReader. All rights reserved.