MD and CEO, Koinonia Ventures Limited, Mr. Olufemi Boyede, speaks on export opportunities for small and medium scale businesses in Nigeria, saying there is a big difference between export and smuggling. The interview aired on the Fidelity Bank-sponsored radio programme on SME was monitored by Olaseni Durojaiye
Tell us all about Koinonia Ventures Limited
The word ‘Koinonia’ simply means ‘fellowship’ or ‘communion’. KoinoniaVentures Limited was incorporated in 1997 but it started business in 1999. At the time, I was the Export Manager at Stanmark Cocoa Processing Company Limited, a subsidiary of Cadbury Nigeria, but I found out that I was stealing my employer’s time, because other CEOs were coming to me right in the office to seek for advice. They wanted what it was that I was doing for Stanmark to make them stand out? They wanted to know how they could access one government programme or the other.
I was doing all of these for free and I thought that I was a double loser because, I was not using my employer’s time for what he was paying me for and I was not getting paid for the advice. At that point, I thought it was time to move on, and to turn that gift that was in me into money for myself and then into something bigger for the country. That’s how we took the courage to throw in the resignation letter and open shop; precisely on June 21, 1999.
What services do you currently offer?
We offer every service that has to do with trade: trade facilitation, export consultancy, export capacity building, and positive criticism that is result-oriented.
For every issue that we take up, either with government or with the real sector, we end it up with a solution that is visible, tangible, practicable and implementable if there is a sincerity of purpose.
How can SMEs in Nigeria enter the international market?
First of all, SMEs in Nigeria have to satisfy the Nigerian market in terms of quality. The international market place is all about standards and quality. It is all about health, regulations and compliance. It is not a free-for-all environment as we have in the domestic trade environment in Nigeria. Nigerian MSMEs actually need to do a lot of preparation (capacity building) before they start. I know that over the past six to eight months, the clamour has been on international trade. Everybody wants to export. In fact, I cannot tell how much stress I have been under recently from those who have been contacting me about their interests in export and how they can approach it. It is all about export-readiness, which is what they must prepare their minds to acquire before they start talking about export.
I did talk about regulation and compliance. For SMEs going into export, they need to understand that there is a difference between export and smuggling. Export means that you repatriate your proceeds through the bank, your sales are captured by the relevant agencies in Nigeria and that your figures are part of what the Central Bank is reporting. Any other thing outside that is classified as smuggling.
You also want to know what price you can get it to buy, whether it needs to be stored and whether there are any damages involved in storage, freight-forwarding, etc. All of these I put in the supply side. As far as financing is concerned, you do need to procure, transport, package, pay the shipping line if you are selling CIF (Cost Insurance and Freight), if not your importer pays for freight and everything that has to do with financing the export. On the market side, you want to know which country you’re exporting to, the import regulations, what they require, and what kind of documentation that needs to be put in place before you get paid. Once you’re able to get these three pedestals, then you’re more than export ready.
Give us one success story of an SME from Nigeria that has been able to export abroad and how they did it.
I am not sure if they are still there, but as a young officer in the Nigeria Export Promotion Council, one of the companies that I was able to take to the international marketplace was a company called Showunmi Craft. Every summer, he would go with his suitcase, 25kg full of his adire and batik craft for male and female, to the UK.
I went for a local trade fair in Jos and I found Showunmi Craft and thought that this would be good for the international market. We helped Showunmi Craft to register as an exporter. In 1990, we took Showunmi Craft to the 4th Ghana International Trade Fair. By the time we were leaving Ghana, Showunmi Craft already had two agents and two shops in Accra and from there he was able to perfect and continue his export. I was in Benin last week on a 1-day workshop for the Nigerian Export
Promotion Council and I did give them the example of another MSME who actually was not interested in exporting. His name is Samuel, a Bronze Caster from Benin City. I had to pitch to him to go to Germany for the Munich Fair in 1992. At that time, I was in charge of International Trade Fairs at the NEPC. I actually had to fund his international passport, not because he didn’t have the money, but because he wasn’t interested in exporting. He had a lot of orders from the National Commission for Museums and Monuments and he did not see any reason why he should go to Germany. I told him that his products would bring him out there. By the time he went there, on the very first day he opened, he sold one single Benin bronze head for 10,000 Deutschmarks. He won a Gold medal as one of the best products exhibiting in the Munich Fair in 1992 and today he has about three shops in Germany.
By Olufemi Boyede
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