What key features underpin the attractiveness of the Nigerian consumer market?
ADEGUNWA: The population size and the litany of embryonic segments within the market are enticing to investors. While the market is still in its infancy in terms of infrastructure, logistics and service delivery, the growth potential is exponential, with a customer base of over 200m people. For a fast-moving consumer goods (FMCG) player, especially in the food and beverage segment, the attraction is self-evident, given the indispensability of these product lines to daily sustenance. The challenge in actualising this potential lies in weak governance. Fortifying public governance in terms of policy, accountability and transparency will facilitate the shift from actual to potential growth.
How has digitalisation impacted the FMCG space?
ADEGUNWA: Technology has transformed the entire value chain of the sector, rendering digitalisation an indispensable part of business operations and product delivery. Enterprise resource planning systems are essential to operations and encompass accounting, compliance, human resources, and research and development. All processes are now subject to digitalisation, augmenting the industry’s level of efficiency and automation. Adoption has been robust, with most firms aware of the costs of inadequate digitalisation.
The rise of e-commerce has impacted the sector by not only expanding delivery channels, but also inform-ing business strategies. The resulting collation of data on consumer preferences has expanded the potential for data-driven decision-making in a market that often suffers from a paucity of intelligence.
In what ways can sustainability be a catalyst for deepening local manufacturing capacity?
ADEGUNWA: The rhetoric around deepening local manufacturing capacity has been promising. However, the governance structures are inadequate to catalyse the requisite capacity for sustainable growth. Governments need to be pro-manufacturing by fostering and implementing policies that stimulate capacity, as evidenced in Ogun State. Capitalising on the robust demand for local products requires a commitment to addressing bottlenecks, from licensing and port congestion to foreign exchange shortages. It is difficult to sustain a healthy manufacturing climate in the absence of stability as companies need to take unexpected costs into consideration. A concerted effort to improve public governance will ensure that local manufacturing capacity can thrive in the long term.
Which strategies do you see as viable for increasing local supply chain resilience?
ADEGUNWA: One of the biggest challenges for the sector is the dearth of organised farming at a scale sufficient to support a resilient supply chain. As players in the food and beverage segment, we need to create a supply chain capable of providing the commercial quantities needed to feed the production line. All stakeholders in the sector need to engage with farmers actively, providing the requisite resources, capital and training to scale to commercial viability.
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