This is the first of a series of posts detailing the trends and common threads that I’ve learnt through interviewing a wide range of businesses operating in East Africa.

The East Africa Business Podcast is the weekly podcast that I’ve been running for the last six months. Right now we’re on episode 29 with plenty more to come, and so if you’re interested in hearing new episodes and checking out the archive, then hit Subscribe wherever you get your podcasts.

The first major sector that we’re going to look at is Food.

Food businesses in general

Agriculture is the dominant sector in each of the East African countries I’ve spent time in. This naturally reflects itself in the types of business that have sprung up, compared to more developed economies that, say, foster companies building the next generation of B2C consumer apps.

The result is that I’ve met with an above average number of interviewees that could be considered “agriculture”.

To make the distinction, the episodes featured in this piece are interviews whose business is focused on what happens once raw produce comes out of the ground. Future posts will cover businesses who occur earlier in the food chain.

For now though, let’s take a look at some of the lessons, directly from the entrepreneurs themselves.

“The food supply chain is nascent”

Lauren from GetIt was one of my earliest interviews, and remains one of my favourites.

The business began as a way to deliver fruits and vegetables to individuals in Rwanda’s capital city, though it soon emerged that a more pressing opportunity was to deliver produce to the country’s burgeoning restaurant scene.

Facilities to store food are scant in Rwanda, and so the only way to cater for these increased volumes was to build cold storage units themselves. In an environment with inconsistent grid electricity, the best option has been a solar powered refrigeration unit – essentially energy from the sun making a massive ice cube.

The interview is also packed with examples of the nuance of doing business in East Africa, such as improving the quality and reliability of produce from farmers, conducting customer service over Facebook as it doesn’t incur data charges, and how to deliver food when people don’t have addresses.

You can listen to the full episode here:

 

“Healthy consumption is on its way”

Near where I was staying in Kigali (capital of Rwanda) was a smoothie shop called Twistiblendz that I found myself frequenting with my friend after we’d go for a jog around the city.

The shop owner was Anitha, who had begun the enterprise a year ago, and had recently expanded to a larger premises, with another on the way.

It seemed like an interesting opportunity to conduct an interview, and in the shop next door we covered all the basics of running a small enterprise: investment required to start, customer segmentation, and trends she’s seeing in who and how people are looking to engage with her product.

We also go into how superfoods are increasing in popularity in Rwanda, and how the production of moringa and chia seeds were yet to find an export market.

You can listen to the full episode here:

 

“Almost all “processed” food is imported”

One of the biggest findings came from the interview I did with Christian from FarmFresh.

Coming from the UK, when I’d pick up, say, a can of kidney beans I never really thought about the steps required to take the raw beans, and get them in a tin. To me, they just, sort of, appeared there.

But when Christian showed me around the small-scale factory he was running, I got to see the distinct stages of getting raw beans (Rwanda’s staple food) cooked, and in pouches for sale.

Scanning supermarket shelves you would (and do) see that almost every packaged good where the core ingredient was sold by market stalls in its raw form, was imported: tomato paste made in India, cornflakes imported from Europe, coffee roasted in South Africa.

This presents a huge opportunity for the region to build capacity for manufacturing foodstuff, taking abundant low value produce and turning it into higher value products to sell.

You can listen to the full episode here:

 


And on the topic of products imported and not manufactured in East Africa, also listen to this episode about toothpicks.

“Finding food buyers is tough”

In any conversation had with those early on in the food chain, the recurring message was that stable, predictable demand was the missing piece.

When it comes to developing the agriculture sector, in my opinion, the key to unlocking efficiencies throughout is a reliable way to sell the final product.

Market linkages are very weak across the region meaning that farmers struggle to sell their produce once it has been harvested. In the absence of formal routes to market, many remote small scale farmers are left to accept any price that is given to them, or else leave their food to go rotten. I’ve been told that in Kenya, 60% of mangoes produced go to waste.

Looking to help sure of the link from farmer to producer, I talked with Maria from Ninayo (which means “I have it” in Swahili). They are setting up a marketplace to connect buyers and sellers for agricultural produce in Tanzania, and in the interview we cover many aspects of how they’re setting up this early stage company to scale.

You can listen to the full episode here:

 

Conclusion

For me the main takeaway in all this talk of food is how much potential exists within East Africa.

As incomes rise, and local consumers can begin to trade time for money, I see products such as FarmFresh’s cooked beans having much more prominence in shopping baskets in the region.

There are doubtless many categories in which this applies, a few of which I’m looking at myself, and this coupled with the idea of a more formalised infrastructure throughout the industry has the potential to transform the region. For those interested, this is the central thesis in Joe Studwell’s development book How Asia Works, which is useful (I find) for drawing parallels between how East Africa could follow a similar path to prosperity.

Feel free to add your email address below to get a notification of when the next in this series will be published, and in either case, thanks for reading.


 

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The East Africa Business Podcast is a weekly podcast interviewing entrepreneurs about their experience doing business in the region.

To subscribe, search for The East Africa Business Podcast wherever you get your podcasts. To suggest an interesting person to feature on a future episode, or if you’re interested in sponsoring the podcast, please contact: podcast@samfloy.com