The Nation Newspaper

Category: Consumer Watch

  • Tomato paste importers seek review of forex policy

    Tomato paste importers seek review of forex policy

    Some importers have called on the Federal Government to review the Central Bank of Nigeria forex policy banning them from accessing foreign exchange from the official window just as indigenous producers are saying that the restriction is a welcome development in restoring agriculture as the main stay of the economy.

    Labour union officials in some of the local tomato processing companies have called on the presidency to prevail on CBN to review the forex policy listing of triple concentrate tomato paste among the 41 items banned from accessing foreign exchange from the official window by the Central Bank of Nigeria as the inability of the firms to import tomato concentrate which is the main raw materials used in their production process had drastically affected them.

    According to the President, National Union of Food, Beverage and Tobacco Employees, Lateef Oyelekan, the companies involved should be given the latitude to plan for backward integration as one of the downside of the policy is that it could lead to massive job losses, as an estimated 1000 jobs are likelyto be lost in the tomato process manufacturing sector.

    “The jobs of the workers are at stake unless the ban is reversed, and that the opportunity for backward integration would be lost by the affected companies.”

    According to him, the quantity of the produce being cultivated presently in the country is not enough for local consumption and the quality is not good enough to be processed into paste. However, Mr. Felix Aigoro, an Agricultural Expert with over 20 years experience in tomato farming, pointed out that Nigeria produces high quality tomato and is ranked the 2nd largest producer of tomato in Africa and 13th in the world with a total production estimated at 1million hectares of land producing 1.701 million tonnes per annum with average of 20-30 tons/hectare yet Nigeria remains the largest importer of tomato from China.

    In an interview with The Nation, the Agricultural expert on tomato adviced those clamoring for the review of the CBN forex policy to rather ask Government for greater aid and support towards granting low interest loans, infrastructures, steady energy and creating enough tomato processing plants.

    “It is estimated that between 35 per cent and 40 per cent of the total agricultural produce in the country is lost due to absence of non- provision of processing facilities. This has resulted in cycles of scarcity and plenty of fluctuations in prices”, regretted the tomato farmer.

    Decrying the unfortunate situation, the tomato farmer said that Nigeria imports 65,809 tonnes of processed tomato annually worth over N11.7 billion despite its massive local production adding that the trend may continue if adequate processing and storage mechanism is not developed and put in place.

    “Take for instance, a recent survey has revealed that most of the brands in the market are imported and the presence of local brands is scarcely noticeable’’, he said

    Speaking further, he said that although more than 200,000 Nigerian farmers grow tomato, not one of the more than 50 tomato paste brands for sale is made from their produce resulting in half rotting in the fields before reaching the market.

    “The market is assured for any entrepreneur who comes out with good quality brands because tomato products are in daily use, have high repeat sales tendency and a long cycle therefor establishing more tomato fruit processing plants in the country will go a long way towards utilizing the enormous quantities of fresh tomato that go waste for lack of processing and preservation especially during post harvest periods of plenty.

    Reacting to the statement that local production may not be enough to meet demand and the quality of the locally grown tomato may not be good enough to be processed into paste, Mr. Aigoro who has a 1st and 2nd degree in Agricultural science said that “Nigeria has the capacity to meet local demand and even for exportation and the quality of our tomato especially from the northern part of the country is top quality”.

    “We have seen a lot of improvement in the demand for our products especially our Life vegetable oil since the new CBN forex policy restricting importers of Vegetable oil from accessing foreign exchange through the official way” enthused Chris Chigbo, Executive Director of Chicason Group an indigenous company.

    Speaking, he noted that the restriction of imported finished products will greatly encourage local manufacturers who hitherto were finding it difficult competing in terms of price with most of the importers who were not even paying full duty on their products.

    “We are also happy with the increased tariff on imported lubricants. Before now, the market was filled with all brands of adulterated and substandard lubricants but with the increased tariff we now have some semblance of sanity in the lubricant market” said the Chicason, Director,manufacturers of A-Z oil.

    However he stated the need for a little review of the CBN forex policy on some raw materials which Nigerians are not yet producing enough to meet demand adding that restrictions on those materials will only make the manufacturers to source from parallel market which will  increase the price of the finished products.

    Also speaking on the policy, President of the Lagos Chamber of Commerce and Industry (LCCI), Remi Bello, while criticizing the policy, warned that most manufacturers might be forced to shut down and move their operations to neighbouring countries due to their inability to access foreign exchange for raw materials and other critical inputs.

    According to him, the government needs to first address the issue of post-harvest wastage emanating from inadequate storage and the absence of processing facilities and the development of agro-allied industry. “No matter how bounteous the nation’s harvest is, such productivity will count for little if the produce cannot be stored.” he said.

    However the CBN Governor, Godwin Emefiele noted that as a result of the policy, the bank has been able to conserve some foreign currencies with a lot of progress made on local production of the 41 listed items.

    According to reports, Nigeria imports 65,809 tonnes of processed tomato annually worth over N11.7billion.

    The CBN Governor clarified that “the Apex bank did not ban total importation of the said items but only restricted access of foreign exchange from official markets to the importers of those items that we think we can produce competitively locally so as to improve our local industries due to the challenges we have, due to the fall in crude oil revenue.”

    Appealing for more patience and understanding, from Nigerians and the people affected, he said that the Government and some other stakeholders are convinced that these items can be produced locally adding that forex can only be made available to those importing essential raw materials and goods that cannot be produced within the country.

  • How effective are weight loss pills and herbal remedies?

    How effective are weight loss pills and herbal remedies?

    Fortunately or unfortunately, our family house is on a busy road in Enugu. Most times if you listen well you hear all kinds of traders shouting as they hawk their wares. On one of such days during the last Christmas holidays, I overheard a herbal medicine promoter in an open vehicle holding a microphone promoting herbal remedies for weight loss, among others.

    He attributed all kinds of power to the medications, especially its efficacy in combating obesity. Looking out of the window to confirm if he was actually getting patronage, I was surprised at the reasonably large number of people who had crowded his vehicle to patronise him. So amazed was I that I decided on doing a story on the issue as soon as I got to my base.

    Chief (Mrs.) Kuburat Akinsola recounts her ordeal as she battled to lose her over 150 kilogrammes (kg) of weight through the use of slimming pills and the much-touted herbal remedies.

    “I was a hefty 65 years old woman, measuring about 5 feet 11 inches tall and weighing about 150kg. Breathing, walking, sleeping, just living a normal life was a big problem to me.”

    Continuing, she said, “I was diagnosed of diabetes, high blood pressure, arthritis and my life was ebbing away due to the steady decline of my health occasioned by my obesity.

    “After a series of warning to lose weight from my doctor at the Lagos State University Teaching Hospital Ikeja (LASUTH) and with a reference to the Dietetics and Nutrition department of the hospital, I decided to ignore the latter and sought solace from Dr. Kik Chu Wang who started treating me with different slimming pills and natural remedies.”

    A close look at the packs of the natural remedies which Akinsola made available to the reporter revealed that some of the packs were of Chinese origin while two were of the much advertised slimming pills and herbal slimming remedies manufactured in Nigeria.

    “Though I started shedding weight within one month of treatment, I developed some other complications, ranging from constant headache, lethargy, insomnia and a higher level of blood pressure,” she claimed.

    Fortunately, she said she had to seek the services of a professional dietician at the Eko Hospital, Ikeja, who has been able to bring her weight down to 110kilogrammes through a change in her diet, targeted exercise and a more active life.

    At Dr. Kik Chu Wang’s office at Itire Road, Ojuelegba, though he admitted knowing the woman, he refused to confirm her story or respond to further questions from the reporter.

    However, Halimah Oluwaseun Muhammed, an orthodox nurse but later trained as a herbal supplement nurse, said she branched into the unorthodox medicine as a result of the success her mother recorded in her health, through the use of herbal medicines.

    The amiable lady, who has a big herbal supplement store at No 1, Samuel Street, Akowonjo Road, Egbeda, Lagos emphasised that patients who lose hope in orthodox medicines come to them for treatment and go away happy.

    What are the major contents of those slimming pills and natural herbs? She quickly explained that “they are derivatives from organic plants, stems, leaves, roots, seed which have no side effect when taken”.

    Rather, she explained, when patients consume the herbal medicines, the quantity needed is absorbed by the body and the residue come out through sweet, urine and feces.

    Explaining how it is administered, Halimah Muhammed said that a patient is first of all placed on a one-week purgative treatment, after which the patient is given fat burner pills and herbs.

    “The pills and herbs break down the fat in the patient’s body which the patient passes out through the feces, and within two months of treatment the result is evident,” she said.

    But she also stressed that the herbal treatment must also go with a reduction in high fat diet and accompanied by body exercises.

    At the department of Dietetics and Nutrition, LASUTH, the head of the dept., Mrs. Bamidele, said as a professional, she will strongly advise against the use of slimming pills and natural remedies as one cannot really vouch for the contents and various claims attached to it.

    “Before you are placed on a special diet or exercise regime or any treatment, medical test should be conducted to know your state of health, but with unorthodox medicine, do they carry out any medical test?” she queried.

    Besides, asked the HOD, how do you know the dosage of the slimming pills and other weight loss herbs you are supposed to take?

    Dismissing the use of slimming pills and natural weight loss herbs as ignorance, the dietician and nutritionist said she does not prescribe pills for weight loss but advises on eating the right things, living an active life and exercising your body.

    On whether the herbal remedies work, she said she does not know as she has never taken any one but advises people with weight issue to see medical dieticians who will place them on a regime that will gradually but surely get them to the right weight, adding that losing weight is not a fire brigade work.

    She was also quick in adding that losing weight under the watchful eyes of a dietician does not incur more money as the patients spend less money on her feeding.

    “There is no side effect and we monitor your progress as you will be given appointments for follow up,” said Bamidele.

    In an interview with a nutritionist, Dr. Mrs. Ikeakor, she advises physical workout, eating the right food and at the right time in order to lose weight.

    “Eat less, so that the body will rely on what it has already stored up. As the body keeps taking up from already stored up calories without the patient adding new calories, there will be noticeable reduction in weight.”

    Easier said than done, you may say. How can you eat less and remain hungry? But the nutritionist advises you eat high-fibre foods with loads of vegetable to feel full.

    Research has shown that the market for natural slimming pills and herbal remedies is rapidly expanding.

    They are displayed in market stalls, shops, orthodox pharmaceutical shops and even hawked along the roads.

    These range from pills that claim to ‘bind’ to fat to stop you absorbing it, to seaweed capsules that say they speed up your metabolism.

    Most manufacturers make enticing claims for their effectiveness, some even stating that you do not need to diet to lose weight. The vast majority assert they are clinically proven or more impressively, makers say they are a certified medical device.

    A majority of supplements touted as “all natural” contain ingredients such as controlled substances, seizure medications, prescription drugs, etcetera.

    So you cannot assume that weight loss supplement is safe and effective simply because it is in the market. They do not undergo rigorous tests for safety and effectiveness that are required for drugs.

    Evidence shows that the most effective way to lose weight and maintain weight loss involves life style change, such as adopting nutritious, balanced and calorie-restricted diets.

    At best, weight loss products should be considered an add-on to lifestyle changes.

  • We’re committed to social investments in Nigeria-Guinness boss

    We’re committed to social investments in Nigeria-Guinness boss

    Peter Ndegwa, Managing Director/Chief Executive Officer, Guinness Nigeria Plc ahead of the company’s  Annual General Meeting recently spoke on some milestones recorded by the brewery giant. Ibrahim Apekhade Yusuf was there

    This is not the best of times for many companies no doubt owing largely to dwindling fortunes across virtually all sectors of the economy. For companies in the fast moving consumer goods segment, they suffer a lot of privations they are not willing to admit. They contend with regulatory headwinds among other tougher challenges.

    But in the midst of these uncertainties, Guinness Nigeria is unfazed. If anything, it sees the challenges as opportunities for growth and expansion.

    Speaking at a pre-annual general meeting/media briefing in Lagos, Managing Director/CEO of Guinness Nigeria Plc, Mr. Peter Ndegwa, said one of the priorities of the company is to increase its local content from the current 43 per cent to 75 per cent in the next three years. This, he said, will  have multiplier effect of increased jobs and opportunities for Nigerian small and medium enterprises and suppliers.

    He outlined that Guinness Nigeria was poised to strengthen and accelerate its premium core brand, support innovation as well as build and constantly extend route to consumers at the right price and right quality.

    Ndegwa, who resumed as the chief executive last September, assured that as a global company, Guinness Nigerian will continue to do everything humanly possible to adhere to highest quality standards.

    Specifically, by 2018, three-quarters of materials and products from Guinness Nigeria Plc would be developed from Nigerian sources as the Nigerian subsidiary of Diageo Plc moves to deepen its Nigerian root and drive growths with Nigeria-based innovations and resources.

    While giving performance highlight of the company, Ndegwa said: “In the period under review, sales continued to grow despite a challenging trading environment, being 3% ahead of the same quarter last year. Despite the sales growth, gross profit declined by 12% versus the same period last year due to the impact of exchange rate devaluation, inflation, an increased share of value brands, together with the phasing of costs.

    “Marketing, distribution, administrative and other expenses at N8bn were 2% ahead of the prior year. Reported operating profit at N1.4billion is 50% below the previous year but is significantly impacted by the phasing of costs which is expected to reverse during the rest of the year.”

    On the future priorities of the company, Ndegwa said among others, Guinness was poised to strengthen and accelerate its premium core brand, support innovation as well as build and constantly extend route to consumers at the right price and right quality.

    As part of its expansionist drive, Guinness Nigeria, he said, has agreed to the acquisition of the distribution rights to Diageo plc’s International Premium Spirits (IPS) brands in Nigeria.

    As part of the transaction, Guinness Nigeria will also take over various assets, including the current inventory of Diageo Brands Nigeria Limited, the wholly-owned Diageo business which currently distributes and markets the IPS brands in Nigeria.

    The consideration for the transaction is approximately N2.35bn. The transaction was concluded by December 31, 2015 and the new distribution agreement for the IPS brands became effective on January 1, 2016 subject to receiving all regulatory approvals.

    Speaking on the deal, Ndegwa said: “The transaction we are announcing today will facilitate the achievement of our ambition to create the best performing, most trusted and respected consumer products company in Nigeria by leveraging the strength of our unparalleled portfolio of beer, adult premium non-alcoholic drinks (APNADs), ready to drink (RTDs) as well as spirits.

    “The integration of the Diageo IPS brands with the Guinness Nigeria brand portfolio best fits our strategy of filling the gap in our total beverage alcohol portfolio, and allows us to compete across segments within the market.”

    For a company committed to its social investment, Ndegwa said nothing is left to chance.

    “We’re a company that adds a lot of value to the progress of this country and we will continue to do so. We’ll continue to give scholarship to people we think are deserving of this. Our support to small and medium scale companies is also very unique because these are businesses that can turn around the economy.  Adding value to all the stakeholders and that is what Guinness Nigeria is all about.”

    The company which prides itself as Nigeria’s investment ambassador has further assured that it will continue to invest in the country in spite of the current environmental conditions in the country.

    “We’re 65years now but we believe we still have a long way to go in this country. Our flagship social investment is also important to us.”

    The Guinness Nigeria boss said, some of its flagship social investments like the Water of Life Project by Guinness Nigeria dedicated to provision of clean and safe drinking water to deprived communities across the country.

    “There is hardly any state in Nigeria that we don’t have the project or about to start. We only recently commissioned a project in Abeokuta in a place called Ajide. We added water to three local governments in Cross River State under the Safe Water and Hygienic programme. We will continue to also add value by supporting our Eye Hospitals. I’m sure you know of Guinness Nigeria Eye Centre, Idi Araba at the Lagos University Teaching Hospital. We’ve another one in Onitsha and this year we hope to put a lot of facilities in those hospitals so that they can continue to be beneficial to the communities.”

    It would be recalled that National Agency for Food and Drug Administration and Control (NAFDAC) had few weeks ago slammed a N1 billion fine on Guinness Nigeria as “administrative charge” for alleged non-compliance with certain guidelines on raw materials revalidation and disposal.

    But Ndegwa said the company was doing everything to ensure the issues with NAFDAC are resolved amicably.

    He said while the circumstances that led to the imposition of the fine were very regrettable, it was not a deliberate effort on the part of the company to flout extant rules and guidelines for quality control.

    “As a global company we set store for the ideals of quality, which has earned us accolades from around the globe and even locally from our regulators, including NAFDAC. The material was not even found inside our factory. It was from one our hired warehouses. The raw materials had not even gone through our brewery process. This is just a one-off thing that would be resolved amicably,” he said.

  • Business process outsourcing (BPO) Part 2

    Some countries in Africa have recently started buying into the BPO market, doing everything possible to become competitive destinations. This is as a result of identified huge potential in the African economy, considering the market size, which relies largely on Western Countries’ finished products, which are virtually not being produced on the continent. Geographically, the bulk of African BPO activity is presently concentrated in two regions of the continent namely the Southern and Northern Region.

    Although, there are pockets of BPI activities in the West African sub-region, especially in Ghana and Senegal, South Africa is however currently leading the Africa BPO, performing call centre services, and all forms of back office operations. In the Northern region, Egypt is taking the lead in BPO, while Morocco and Tunisia are striving to evolve a reliable BPO sub-sector.

    The South Africa Experience

    In South Africa there is callingthecape BPO in Cape Town. The South African government has been able to evolve an enabling environment for BPO investors in South Africa by providing business incentives aforementioned. The geographical location and cultural background of the South African workforce also contributed positively to the growth of BPO in the country.

    Other countries in Africa that are striving to evolve BPO sub-sector include Mauritius and Botswana. Notably, Mauritius has 23 operators in its Ebene Cyber Tower, with a second tower under way. Nonetheless, Africa has a huge potential in BPO development, not only because of the size of the continent economy or its cultural relationship with the West, but because of the rising costs in the traditional BPO countries.

    Nigerian Initiative

    In January of 2007, outsourcing policy guidelines was launched by the Federal Government.

    The key thrusts of the policy are:

    1. i) To promote an outstanding orientation starting with onshore outsourcing and progressing through near shore to offshore outsourcing by encouraging stakeholders involvement in developing a vibrant outsourcing sub-sector;
    2. ii) To grow Nigeria’s image internationally as the preferred outsourcing destination and ICT business hub by developing a global competitive Information Technology enabled services sector; and

    iii)         To facilitate the development of appropriate ICT infrastructure to support capacity building for quality service delivery in the outsourcing sector.

    The Policy Objectives

    The overall policy objective is the promotion of an enabling institutional, legal, regulatory, technological, and infrastructural environment for the sustainable development of the outsourcing sector in Nigeria.  Some of the specific objectives are:

    1. i) Actualization of the goals of the NEEDS policy of Government in the area of Information Technology Development;
    2. ii) Developing a globally Competitive Information Technology Enabled Services (ITES);

    iii)         Promoting local and foreign Direct Investment in Outsourcing Infrastructure development;

    1. iv) Developing an Export-Oriented ICT Product and Service delivery industry;
    2. v) Accelerated Human Resource and ICT infrastructure development to support growth in the outsourcing sector; and
    3. vi) Facilitate rapid deployment of ICT and enabling physical infrastructure.

    Good news from India

    India is also no longer leading the pack of most-favoured outsourcing destinations. Instances of foreign firms pulling back the outsourced work are growing.

    In recent months companies such as Capital One, Dell Computer, Lehman Brothers and AXA have repatriated their back office operations from India.

    Conseco, an American insurance firm, is the latest to join the roster of firms moving back their outsourcing operations. According to reports in foreign media, the list is expected to grow.

    Conseco had outsourced as many as 800 jobs to India three years ago. The company then believed that India would provide better customer services. But that feeling is changing now.

    These days more than 150 workers at its headquarters and 100 at a Chicago-based subsidiary field calls from independent agents and customers. These jobs were earlier handled by an outfit near New Delhi.

    RECOMMENDATIONS

    There are significant external opportunities, which could be exploited with appropriate strategy formulation and implementation while at the same time indicating areas of concern with regard to threats from other emerging BPO locations around the world that are positioning themselves for a share of the global BPO market and therefore direct competition to Africa.

    Recommendations are made in the following areas to position Africa as an attractive BPO destination.

    • Manpower
    • Infrastructure
    • Competitive Positioning
    • Overall enabling environment

    Manpower

    • Introduction of basic BPO Training at School and University level
    • Offer incentives to private sector for training in BPO
    • Attract highly qualified and experienced professional from India and France through easier immigration facilities.
    • Focus on improving both reading and writing skills in French and English

    Infrastructure

    • Telecommunications
    • Reduce International Private Leased Circuit (IPLC) rates either by introducing competition or cross subsidizing
    • Real-Estate
    • Ensure that rental and leasing rates for property are relative price consistency across the island for same quality of services.
    • Transportation
    • Increase international air access and connectivity to destinations

    Creating Enabling Environment

    • Stimulate better coordination between private and public sector in the BPO industry.
    • Create an umbrella organization for BPO promotion that is dedicated to proactively initiating, setting policies, guidelines and promoting the IT industry advantages within and outside Mauritius.
    • Accelerate Data Protection Acts so it complies with EU regulations
    • Government should remove all restrictions and should encourage the immigration of specialized talent pool to settle in the country.
    • Simplify access to capital for entrepreneurial investments in BPO

    National Competitiveness Strategy

    Improving competitiveness requires a strategy to improve the business environment and competency at the national level. The strategy should focus on cross-cutting issues, with the needs of key growth sectors determining areas for priority attention.

    National Branding

    National branding can boost a country’s profile on the international business scene, but strategists must think long term and promote national characteristics that match business reality.

    Sectoral Competitiveness

    Value chain analysis highlights links in the chain where firms and countries can capture more value from Business Process Outsourcing.

    In-country Alliances

    Industrial clusters, ICT villages, business networks and alliances between non-governmental organizations and exporters provide ways to improve a country’s international position.

    Measuring Performance

    Trade development officials need benchmarks to establish how far they are meeting their objectives. They should try to measure impact, not just resource inputs and service outputs.

    Conclusion

    BPO appears a new economic opportunity for the emerging African economy. However, governments in Africa need to partner private sectors under a Public Private Partnership (PPP) arrangement for a virile BPO sub-sector to evolve in African countries. Apart from helping African economy to grow; and be in tune with the international business ethics, establishment of BPO will help reducing high unemployment rate in Africa countries. However, authorities in African countries will need to remove entry barriers for investors in BPO, develop fast and integrated infrastructure in transport logistics and telecommunication.

    Nigeria has all it takes to evolve virile competitive BPO outlets that will become the next global destination, as a result of availability of cheap labour, skill manpower and huge market for Western products as well as cultural affiliation with the Western World. But government in these countries needs to create the enabling environment for prospective BPO investors to operate in Africa.

    • Dr. Madu, a recipient of the 2014 National Productivity Order of Merit Award can be reached by ceo@multimix-academy.com
  • When shelf price display differs from checkout price

    When shelf price display differs from checkout price

    A shelf price tag is designed to tell you the accurate price of product, items code, and description of product. It is supposed to be clear and conspicuous. The price at checkout point must reflect the same price displayed on the shelf tag.

    But, it is not so at Game Stores Polo Park Shopping Centre Enugu. What’s more, the Customer Service Officers (CSOs) do not care.

    Mrs. Ngozi Egeonu visited the store and saw a product on Aisle No. 4, which she reasoned that her daughter and her nephew would like. The displayed shelf price stated N460, however Egeonu had run out of cash, so she decided to come back the next day to make the purchase.

    The next day, Jan 4th, she set out for the store. Eagerly, she went to Aisle 4 where they had a display of toys and checked in anticipation to see if the product was there. She heaved a sigh of relief that the product, ‘Ja-Ru Glitter’, was still there, just like it was when she first saw it. The price also had not changed.

    Happily, she grabbed two of the products, [fancy girl nail packs] and went to the checkout. Mentally, she had already calculated what the price of the two would amount to, so she extracted one thousand naira note from her bag.

    The checkout operator, with number 103, scanned the bar code on the first pack and the price reflected N694 instead of the shelf price of N460. Noticing it, Egeonu objected immediately, saying that the shelf price was N460. The cashier, however, pointed out that the checkout was reflecting a different price from what Egeonu said. The cashier then beckoned on another staff to go to Aisle 4 and confirm the shelf price of the product. She came back and confirmed what the customer said, advising Egeonu to complain at the Information Front Desk.

    Unfortunately, the lady at the Information Front Desk told her without any apology or regret that the price of the product had changed and that she had to pay the new price of N694. “If the price has changed, why did it not reflect on the shelf price? Why is the shelf price still N460?” asked Egeonu.

    Egeonu insisted that she would pay N460. The CSO at the Front Desk, unethically not wearing a name tag, told the customer that as a matter of fact she had to pay the new price. At that point, the customer demanded to see the manager. Consciously trying to frustrate the customer or too lazy to do the job she was employed for, the CSO informed the customer that she had to come back the next day to see the manager.

    The customer asked if the CSO would pay for her time and fare. In anger, Egeonu started taking notes of the exchange. Seeing she was taking notes, the obviously untrained CSO now asked the customer to wait for an hour for the store manager to attend to her as he was having his lunch.

    By then, another lady staff at the Front Desk with a name tag, ‘Oluchi, Princess Nkemjika’ regarding the customer as if she was an irritant but seeing the determination in her, told the ignorant staff that as a ‘Manager’ that she should be able to attend to Egeonu by scanning the product and discounting so that Egeonu would pay the price of N460 as displayed on the shelf.

    Princess Nkemjika, taking the product from the customer without apologies, scanned and discounted and Egeonu paid the real price of N460 each. Now facing the staff without a name tag, the customer gently asked for her name seeing that she must have deliberately removed the name tag. Responding hotly without revealing her identity, she countered “What are all these questions for?’’

    What a shabby way to treat a customer who actually pays your wages! Without the customer, all of them working in that store would not be there.

    The unfortunate thing is that, that untrained staff must have been treating customers like that and getting away with such behaviour, little wonder she hid her identity. But why should she be allowed to be in the store without a name tag? It should, however, be noted that she was on duty on Jan 4th afternoon with Oluchi, Princess Nkemjika. Unless, of course, the management is to be blamed for not training the staff.

    Obviously, the staff of Game Stores do not know the legal implication of having the wrong shelf price on display. In countries like the United Kingdom, where consumers are well informed and government all out to protect the interest of consumers, the Government Trade Malpractices Organ from time to time randomly pays unscheduled visits and apprehends erring supermarkets.

    In cases like the one here, the store involved is charged five thousand pounds sterling for each unit of product behind the wrong shelf price/label display. For instance, if there are 30 cans of tomato puree lined behind the wrong shelf price and label display, the store will be charged five thousand pounds x 30 cans, which is 150,000 pounds sterling, or risk closure.

    Such visits from the relevant government regulatory agencies should be encouraged in Nigeria, and supermarkets found to fall short of their responsibilities should be penalised accordingly.

    Under the United States Competition Act, there are five codes introduced to protect consumer interest. Scanner Price Accuracy Voluntary Code, which is one of the five codes, provides a mechanism to provide redress to consumers when there is scanner error.

    Other price representations that result in overcharges to consumers are also examined under this Competition Act. Regarding the Scanner Price Accuracy Voluntary Code, when the scanned price of an item without a price tag is higher than the shelf price or any other displayed price, the customer is entitled to receive the item free when it is worth less than ten US Dollars or receive a ten-dollar reduction for more expensive items.

    Scanner Price Accuracy is regarded as an important element of maintaining consumer interest.

  • Labour union calls for forex policy review on tomato paste

    Labour union officials in some of the local tomato processing companies have called on the presidency to prevail on CBN to review the forex policy listing of triple concentrate tomato paste among the 41 items banned from accessing foreign exchange from the official window by the Central Bank of Nigeria. The officials claim that the inability of the firms to import tomato concentrate, which is the main raw materials used in their production process, had drastically affected them.

    According to the president, National Union of Food, Beverage and Tobacco Employees,  Lateef Oyelekan, the companies involved should be given the latitude to plan for backward integration as one of the downside of the policy is that it could lead to massive job losses, as an estimated 1000 jobs are likely to be lost in the tomato process manufacturing sector.

    “The jobs of the workers are at stake unless the ban is reversed, and that the opportunity for backward integration would be lost by the affected companies.”

    According to him, the quantity of the produce being cultivated currently in the country is not enough for local consumption and the quality is not good enough to be processed into paste.

    He pointed out that it would take years for the planting, harvesting and processing of the produce into concentrate, adding that most of the companies had run out of stock.

    Oyelekan explained that the volatility factor inherent in tomato farming is often a product of seasonal variations, which is itself a function of the variables of weather, agronomy, water, seed, fertilizer, market, storage, transportation, and numerous other agro-allied business dynamics.

    “If triple concentrate tomato paste is now placed among the list of items that will not have access to the foreign exchange market overnight, that line of business has been killed because the government is working from the perspective that there are tomatoes in the environment for cultivation, processing into paste and packaging. Rather than prohibiting the items overnight, why not engage the manufacturers in discussion.”

    He expressed that the objective of the forex restriction was not a bad idea on its own, but lamented that the implementation of the policy has far-reaching implication in the short, medium and long term.

    Also speaking on the policy, president of the Lagos Chamber of Commerce and Industry (LCCI), Remi Bello, while decrying the policy, warned that most manufacturers might be forced to shut down and move their operations to neighbouring countries due to their inability to access foreign exchange for raw materials and other critical inputs.

    According to him, the government needs to first address the issue of post-harvest wastage emanating from inadequate storage and the absence of processing facilities and the development of agro-allied industry. “No matter how bounteous the nation’s harvest is, such productivity will count for little if the produce cannot be stored,” he said.

  • Business process outsourcing (BPO) Part 1

    -Making Nigeria the next destination

    Abstract

    Statistics from International Trade Centre indicate that by 2050, 80% of the work force worldwide will be working in services. The growing competitive business environment has positioned BPO as a key source of competitive advantage. India and China have dominated this industry but as the cost of outsourcing gets higher, companies are looking for other possible destinations. The million-dollar question is: can Africa be the next destination? What are the potentials, prospects and challenges of achieving this tall dream? What success stories already exist in Africa? What are the factors behind the success of the leading world BPO destinations? What are the strategies that will take Africa there?

    This article discusses the gradual global expansion of Business Process Outsourcing (BPO). It identified the leading BPO destinations which are geographically located in Asian countries notably India and China. The presentation further highlighted the factors behind the success of the leading World BPO destinations being availability of skill manpower, enabling business environment created by government in terms of tax holidays and incentives for BPO investors, bilingual factor, IT skill and development as well as fast integrated logistics infrastructure.

    In appraising the African potential in benefiting from inherent economic advantages BPO can offer the continent, the paper identified South Africa and Egypt being the leading BPO destinations in Africa today. These countries were leading because of the availability of the prerequisite enabling environment indices already listed above.

    Although Kenya in East Africa is equally bracing up to meet up with South Africa and Egypt, while Ghana, Senegal and Nigeria are assiduously working towards evolving BPO markets in the West African Sub-region. For instance, in Ghana, an indigenous company is currently operating. Also in Nigeria are operating Call Centre outfits.

    BPO is a new economic opportunity for the emerging African economy. However, government in Africa needs to partner private sectors under a Public Private Partnership (PPP) arrangement, for a virile BPO sub-sector to evolve in African countries. Apart from helping African economy to grow and be in tune with the international business ethics, establishment of BPO will help in reducing high unemployment rate in Africa countries. However, authorities in African countries will need to remove entry barriers for investors in BPO, develop fast and integrated infrastructure in transport logistics and telecommunication. Africa has all it takes to evolve virile competitive BPO outlets, as a result of availability of cheap labour, skill manpower and huge market for Western products as well as cultural affiliation with the Western World. But governments in these countries need to create the enabling environment for prospective BPO investors to operate in Africa.

    Introduction

    The rapid competitiveness in the global economy nowadays, as a result of dynamic business innovations are responsible for multinational corporate bodies, at international level, transferring some of their non-core and core business process to an external provider.

    The above business approach is consequently conceptualised as Business Process Outsourcing (BPO) This approach to BPO is unique because it offers companies a way of achieving transformational outcomes much more quickly. For instance, in BPO the outside provider does not only take on the responsibility to manage the function or business process, but also re-engineers the way the process has been done traditionally.

    Nowadays, BPO is fast emerging as a powerful and flexible tool that business leaders can use to achieve a wide range of tactical and strategic aims. BPO leverages process that drives efficiencies in business in terms of organisational excellence, responsiveness, branding, financial, efficiency and customer relationship. The most prominent business process that is being outsourced today is Call Centres. For instance, Call Centres and Help Desks of many multi-national companies globally are being outsourced to low waged, English speaking countries such as Philippines and India.

    BPO being an IT based process has positioned India, the IT giant in Asia, to attract outsourcing business from American IT/Technology companies. E.g. IT, Help Desk. These are Help Desks that are configured with the state of the art software and hardware manned by IT experts, who also attend promptly to customer request.

     

    The Operation Component of BPO

    Its operations include the following:

    • Telemarketing
    • Data Entry
    • Claims Process
    • Medical Transcription
    • Legal Transcription
    • Corporate Transcription Services

    Worldwide BPO Destinations

    Choosing a country for offshore BPO work presents a strategic challenge to the client on one hand and an opportunity to the country on the other.

    The economic benefits to host nation are compelling and therefore governments are becoming involved, offering incentives to providers that bring business to the country, speeding visa and immigration procedures, granting waivers in labour laws, etc.

    Most BPO consulting firms rate countries on three factors

    1. Cost
    2. Environment
    3. People

    At Kearney, a global consulting firm has rated 11 countries on the three parameters and its findings rate India best in two of the three categories in terms of cost and people. Weakness include poor infrastructure, cultural differences, lack of global exposure, poor soft skills, bureaucratic red tape, complex and inefficient legal system and little business process expertise.

    It says that Canada, Australia and Ireland, apart from their linguistic strength in English speaking, score best in people and environment. They boast of superior infrastructure and lower political and economic risk is undermined by costs, which are understandably higher. Canada has high employee retention rate, business process experience and proximity to US making it the best near-shore option for US clients like BP Amoco, Allmerica and Compaq.

    The historical influence of the United States on Philippines has produced workforce with close cultural affinities and American style English speakers aware of US standards of customer service. The Philippines however has a smaller pool of skilled resources and slightly higher labour costs compared to India.

    Hungary and Czech Republic offer cultural similarities, language and technical skills along with lower hurdles to data privacy regulations (being part of EU) for multinational that operate in Europe.

    China’s strength includes large cheap labour pool suited to large-scale transaction based business processes. Its drawback is high level of political risk.

    It is becoming clear that the choice of country location carries much higher weight than choice of service provider for large BPO deals and process of selection is rigorous.

    Risk mitigation is an important consideration and work is being distributed to ensure business continuity and recovery in case of natural or man-made disaster. Both BPO providers and clients are using multiple country models with specific provisions for hot site, near shore distribution of work. For example in case of a natural disaster in Delhi, a comparable workforce in Manila could perform the same business process without interruption. By the same token companies find it useful to identify subcategories of countries that are most apt to meeting their specific needs.

     

    The Index for Determining BPO Destination

    The benchmark used by the Economic Intelligence Units for ranking the BPO destinations includes:

    • Labour Costs
    • Labour Skills
    • Labour Regulation
    • Proximity to major sources of investment
    • Macro-economic Stability
    • Regulatory Environment
    • Tax Regime, and
    • Infrastructure Development

    To be continued next week

    • Dr. Madu, a recipient of the 2014 National Productivity Order of Merit Award can be reached by ceo@multimix-academy.com

  • Netflix: Behind the hype

    Understandable. That was what I thought of the huge excitement provoked last week by the announcement that Netflix, the US-based streaming service, was launching in 130 countries of the world, including Nigeria.

    The excitement, which seemed like another Christmas had come, is a fallout of the belief that Netflix provides a considerably cheaper alternative to pay-TV, the death of which many-seized by momentary glee-predicted. This is in spite of the fact that pay-TV remains alive and kicking in the US and other countries where Netflix had previously launched.

    Time to party? Not yet.

    It did not take long for the excitement to dissipate, as would-be users of the service started doing some mathematics. At $8 (N2,240) a month, the cost is stunningly low. That, however, is when you ignore the exchange rate, whose notoriously volatile nature suggests what you spend in buying dollars is not going to stay the same, a development that could make Netflix seem like Netfleece!

    But that is just the cost of access.

    You also need data. So, who pays for the huge volume of data required for downloads? Note that there are no unlimited data plans in Nigeria. The cost of data got many thinking more rigorously, with most reckoning that data spend will relieve them of something in the region of N15,000 monthly. Add that to N2,240 or whatever it rises to when, not if, the naira goes down the slope.

    Cheaper still? You know the answer.

    There is also the not exactly small matter of local internet speed. Most local networks have their downloading speed pegged at 200Kbps, something that will make Netflix use the equivalent of an ordeal arising from long buffering periods. Even at this low speed, stability is not guaranteed.

    Similarly important: Netflix will bill exclusively in dollars. This means that Nigeria stands to lose tax revenues and face another round of pressure on its external reserves.

    But there are other issues, notably those of compliance to local regulations and values. The experience in Kenya is instructive. Already, Netflix has compelled the regulatory authorities to raise a number of compliance issues. Two days after its launch in the country, the Kenya Film Classification Board (KFCB) announced that it had identified inappropriate programmes hosted by Netflix which, curiously, is rated for age 13 years.

    The KFCB said Netflix, which carries mostly foreign content-some of which may contain gay and lesbian movies- will not be allowed to stream content considered inappropriate by the Kenyan society. The film board warned that it will flag the unsuitable content and block it within an hour of reporting.

    KFCB head of compliance, Emmah Irungu, was quoted by the country’s media as saying that any foreign content once received in the country shall be subjected to the Kenyan law.

    “In this case, Netflix will be subjected to the film classification guidelines in the country,” said Irungu who added that what could be considered as extreme violence in one country may be rated differently in another.

    “Since it is in Kenya then it needs to be subjected to the Kenyan ratings for consumer protection,” she said.

    In Nigeria, the authorities responsible for licensing, production as well as marketing of film, drama and documentaries have appeared, so far (I hope I am wrong) indifferent to whether some of the offerings by Netflix comply with local regulations and values.

    This seeming indifference will expose Nigerians, particularly young ones, to practices we consider abhorrent.

    • Fadehan, a culture activist, writes from Lagos

  • Chi Limited targets on-the-go consumers

    With its range of high quality fruit juices like Chivita 100%, Chivita Active and Chi Exotic now in 315ml Handy Pack, Chi Limited’s innovative and affordable packaging strategy to target hip, trendy and On-the-Go consumers is seen by industry analysts as a step in the right direction.

    Managing Director, Chi Limited, Deepanjan Roy said that for market watchers, the new 315ml Handy Pack would ensure more market penetration for a brand that is already the leader in Nigeria’s fruit Juice market.

    He said the new Handy Pack which is designed in a dynamic prismatic shape, with an attractive cap that is well blended into the pack, comes at an affordable price of N100.

    The 315ml Handy Packs contains enough juice to satisfy individual consumption and offers competitive pricing as well as value for money, allows consumers to take it along with them wherever they go and fits into the lifestyle of young mobile consumers.

    Roy said: “The new and attractive 315ml Handy Pack has a genuine consumer appeal and the feedback from the market has been fantastic. At the cost of N100, we are confident that the affordability, accessibility and convenience of this trendy, and On-the-Go Handy packs would ensure that our consumers continue to get the same refreshing taste and nourishment – Anytime & Anywhere”.

    “Consumers have extolled the Handy Pack size for its elegance, convenience and shelf appeal. They particularly appreciate its advantages over aluminum can packaging because it is easy to hold, pour from, and is far more environment friendly,” he stated.

  • Special show sponsored by Access Bank to air on CNN International

    Passion to Portfolio, the CNN International series about entrepreneurs harnessing their passion in the global marketplace, was aired as a special 30-minute programme on Wednesday last week.

    The high-profile show is the first of four special Passion to Portfolio programmes airing in 2016. In addition to the extended shows, Passion to Portfolio segments will continue to air fortnightly in the CNN International business show, World Business Today.

    Passion to Portfolio segments and the extended shows are sponsored by Access Bank, one of Nigeria’s largest and fastest-growing full-service banks headquartered in Lagos. The Access Bank advertising and sponsorship campaign originally launched in November 2014 and spans CNN International’s TV and digital platforms.

    The special show aired on 15 January, featured successful innovator, Daymond John, co-founder of the global clothing label, FUBU, and host of the hit US TV show, Shark Tank. Recognised as a branding and marketing expert, John gave CNN viewers insights into what it takes to succeed in business. “I had a passion for dressing people, the money came later,” multi-millionaire John tells Passion to Portfolio. The show also turned the spotlight on Oprah Winfrey’s long-time hairdresser, Andre Walker, celebrity jeweller, Chris Aire, and Michelin-starred restaurateur, Yenn Wong.

    The show will be aired seven times on CNN International. It debuted last week and will continue to January 20th.