LG Foods rides on SI 122 scrap­ping

Sunday News (Zimbabwe) - - Front Page -

GROW­ING food man­u­fac­tur­ing and prepack­ag­ing firm, LG Foods’ pro­duc­tion ca­pac­ity has im­proved to around 80 per­cent buoyed by in­creased accessibility to raw ma­te­rial fol­low­ing the scrap­ping of sec­tions of Statu­tory In­stru­ment (SI) 122 of 2017.

LG Foods man­ag­ing di­rec­tor Mr Lar­rence Gwati said the com­pany’s ca­pac­ity util­i­sa­tion has moved from about 40 to 80 per­cent since the Govern­ment lifted the im­port em­bargo on a wide range of goods last month.

“We are very ex­cited about the Govern­ment’s de­ci­sion to scrap SI 122 of 2017 as it has started yield­ing pos­i­tive results to our busi­ness. We had a very big chal­lenge in im­port­ing (beef) tal­low (an­i­mal oils), which is a ma­jor raw ma­te­rial in the pro­duc­tion of soap as we were sub­jected to pay­ing duty. Now that it’s one of the prod­ucts in­cluded in the im­port em­bargo, which was re­cently lifted, we have man­aged to in­crease our pro­duc­tion lev­els and the quality of our laun­dry soap has tremen­dously im­proved as noth­ing is com­pro­mis­ing us now,” said Mr Gwati.

LG Foods im­ports beef tal­low and crude oil from South Africa, which are in­te­gral in soap pro­duc­tion. Beef tal­low is oil for soap­ing and makes a hard bar with a rich lather. In fact, most soap bought com­mer­cially is made from tal­low.

The com­pany’s laun­dry soap, Zim bar has man­aged to keep prospects of the com­pany’s busi­ness afloat in the face of sales and prof­its from its other prod­ucts plum­met­ing. The com­pany started soap pro­duc­tion last year as part of its diver­si­fi­ca­tion drive to grow its busi­ness.

Mr Gwati said the com­pany has the ca­pac­ity to pro­duce about 200 tonnes of soap per month but was be­ing ham­pered from pro­duc­ing at max­i­mum ca­pac­ity due to the pre­vail­ing for­eign cur­rency short­ages in the coun­try.

“At the mo­ment we are pro­duc­ing 30 tonnes of soap a month but we have the ca­pac­ity to pro­duce as high as 200 tonnes but our ef­forts are be­ing ham­pered by lack of for­eign cur­rency to pro­cure ad­e­quate raw ma­te­ri­als out­side the coun­try. It’s un­for­tu­nate that as a small player we don’t have the lever­age of be­ing al­lo­cated for­eign cur­rency by the Re­serve Bank of Zim­babwe, which is only the pre­serve of big play­ers and strate­gic sec­tors,” said Mr Gwati.

He also said the lift­ing of the im­port ban also en­abled the com­pany to boost its pro­duc­tion of con­cen­trated syrups. LG Foods are also man­u­fac­tur­ers of peanut but­ter, ma­puti as well as pre-pack­ers of fine salt, matemba, sugar beans and soya chunks mostly mar­keted in Matabeleland re­gion and some parts of Midlands. It also does in-house brands for goods des­tined for its three main whole­sale and re­tail out­lets cus­tomers.

Mr Gwati, how­ever, said go­ing for­ward there was a need for the Govern­ment to put in place mea­sures of pro­tect­ing its in­dus­try against the in­flux of cheap im­ported goods.

“At the mo­ment the coun­try is fac­ing short­ages of cer­tain com­modi­ties so open­ing up the bor­ders for im­ports is jus­ti­fied to fill the gap. How­ever, go­ing for­ward we have to sup­port our own in­dus­try so the onus will be on Govern­ment to en­sure that man­u­fac­tur­ers im­port strate­gic raw ma­te­ri­als with­out hav­ing to pay duty,” he said.

Mr Gwati ap­plauded the ef­forts be­ing put by the Min­istry of In­dus­try and Com­merce of en­sur­ing the growth and re­vival of the coun­try’s in­dus­try.

“We ap­plaud the Govern­ment for ap­point­ing Min­is­ters that are com­mit­ted to­wards the re­vival of the coun­try’s in­dus­tries. The fact that (Raj) Modi is the Deputy Min­is­ter is truly a bless­ing to the SMEs (Small and Medium En­ter­prises) as he has over the years showed sig­nif­i­cant sup­port to small busi­ness play­ers and we be­lieve as long as he is in that po­si­tion a lot of SMEs are go­ing to re­alise im­mense growth,” he said.

LG Foods re­mains one of the few SMEs in Bu­l­awayo that have man­aged to weather the coun­try’s tur­bu­lent eco­nomic en­vi­ron­ment. The com­pany was started by its pro­pri­etor, Mr Gwati as a back­yard en­ter­prise in the high den­sity sub­urb of Cow­dray Park in 2005. In 2007 Mr Gwati was to lease a fac­tory shell at Kelvin West In­dus­trial sites and that her­alded the growth of his busi­ness en­ter­prise.

@DNsingo

LG Foods em­ployee Love­ness Moyo shows the un­packed green bar soap at the com­pany premises at Thorn­grove in Bu­l­awayo on Fri­day. (Pic­ture by Nko­sizile Ndlovu)

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