Nigeria should automate her ports to enhance ease of doing business – Omoyele

Danfoss Group, a leading cooling systems manufacturing company launched the brand in Nigeria on February 17 at the Eko Hotels & Suites, Victoria Island, Isaac Anyaogu spoke to Kolawole Omoyele Sunday, the company’s business development manager in Nigeria on the company’s operations in Nigeria and the business environment in general.

Tell us a little about your operations in Nigeria

At the moment we are yet to have a physical structure in Nigeria, but what we do is to support the existing Danfoss business here. We already have people selling our products legally and illegally. Legally are the people that buy from our distributors in Morocco, Dubai and in France. We are yet to get our own accrediited distributor in some product lineup.

At the moment we have succeeded in having two of them which were announced at brand launch in Lagos last month. We announced the two distributors to Nigerians. For the cooling we have identified with Satek Nigeria Ltd at Illupeju and Tahir Naizi Stores in Dubai. TNS stores is selling to some partners at Ebute metta while Satek is buying directly from Nigeria. The reason for doing that is for people that are clamoring to buy genuine Danfoss product will know where to go.

We also have another business that is drives. For that business we have appointed Technid Nigeria Ltd and Automated Process. The idea is to support this four companies so that corporate organisations who intend to buy our products will know where to get genuine products.

We are also looking at supporting our end-users and distributors with basic knowledge of our products, service training knowledge and product knowledge. These are the things we aim to do at the moment.

What are some of your biggest challenges?

Getting our products from the ports. I will say it’s high time for Nigeria, as part of a global village and attracting investors from every nation, (because the truth is that the European market is closing up and the African market is opening up) so I expect that the country moment should begin to put some policies and measures in place to encourage investors.

For example at our ports, both sea and air, it is time we automate our processes. We need to leave the age of bringing papers, signing figures, it gets people agitated. Most investors hands off their logistics to local companies because the process is too cumbersome.

In other parts of the world, you don’t even need to appear at the port to clear your goods. You can apply online and clear your stock. I expect Nigeria to automate its port systems as it will create jobs and enhance ease of doing business.

Then there is the problem of fake products…

Yes, I’m aware the company is worried about it, what is Danfoss doing to combat the problem?

Fake products have become a virus to our business and if care is no taken it could hit the bone marrow. We have taken several measures which we cannot disclose now for the reason that we do not want our enemy to take advantage of it. I can assure you that we are working with relevant agencies such as Standard Organisation of Nigeria (SON) and Nigerian Association of Refrigeration & Air Conditioning Practitioners (NARAP) to stem this tide.

We have our own internal department working to identify those behind it. We have also engaged secret agents who will work together with us to ensure that this battle is fought and won.

How big of a problem really is it?

For our cooling products it is major. Some conglomerate companies or corporate organizations have cried to us about this problem. For example Coca-Cola is lamenting that they have wasted so much dollars buying products in the local market only to discover that it is fake.  Fan Milk has also complained of the same thing so if these organisations are complaining, it means there is a serious problem.

I am sure they are buying nothing less than one container of compressor for example in two months so you can imagine the magnitude of the waste and destruction that is happening because of fake products. If you look at Ebute metta market for example, the counterfeiters have become so good, you will hardly tell original compressors from fake ones.

Give us an idea of the kind of market share these counterfeiters are stealing from you?

Each container cost about $130,000 dollars, and about 30 containers of compressors come in to the port annually, out of which 50 percent are counterfeit products. The total loss of market share on each shipment is about $2 million dollars annually.

In view of this, what are you doing to create awareness for original compressors and cooling systems?

Part of our strategy is the recent launch of the brand in Nigeria last month to sensitize people. There was a session where we displayed original and fake products and we even go the extent of making it a competition where we said people should come and identify which is original and which is fake.

So the idea behind that is begin to prepare the minds of people, to educate them so that when they go to the market, even without contacting Danfoss they can identify original products from fake products.

We have also produced a sticker which we are putting on the doorpost of all our customers across the nation so every customer that is coming will tell you what are the things to check out for in our products that will give you confidence that you are buying genuine products.

Do you have plans to set up a manufacturing plant in Nigeria?

We consider Nigeria as a strategic country in Africa due to its economy, population and GDP growth rate so it’s a country to be. Before now, Danfoss was not thinking of Nigeria but now we are fully committed to the idea and before the year runs out we hope to establish a presence here.

Are you thinking beyond Lagos, as there are emerging commercial hubs in Ogun and Akwa Ibom states, do you plan to reach these states?

Business development is a gradual process and it is an investment. For any investment you take it gradually, one step at a time. When we looked at Nigeria we asked where is more commercialized, which state is most easy for our end users and which state will make it easy for us to import in our products, we found out that it is Lagos.

Our intention also include to service other neighboring countries like the Republic of Benin, Ghana, etc and if that is going to happen, we think Lagos is the easiest state to transits to these countries.

Since your business for now is import driven, how is the current foreign exchange squeeze affecting business?

As you know, it is affecting all the investors in Nigeria. It is difficult to get dollars and that affects imports. We are managing to find our way around it, but it’s a challenge we all have to deal with.