Starting from nothing: Africans CAN build successful businesses

Recently I spent time in Fiwila (around 350 km north-east of the Zambian capital Lusaka) to work with our partner organization HODI on rolling-out microsolar production in the area.

Our basic idea is to create jobs in Zambia - not in China. It was a pleasure to spend some time with small business owner, Mr Ginnis Moono, in order to better understand the joys and tribulations of being a small business entrepreneur in rural Africa.

Sharing ideas. Janelle talks with Mr Ginnis Moono about his business highs and lows. Next month Ginnis will be one of ten microsolar trainees in Fiwila to receive training from SolarAid in micro-solar technologies.

Following is a brief summary of Ginnis' story, as he told it to me:

I'm 38 years old, live in Fiwila, and am supporting a household of eight people: four children of my own, a niece and a nephew, plus my wife and myself. I'm of the Tonga tribe: my father - who was a policeman - was from Choma in the south of Zambia, but I was born in Kabwe. I own a small shop selling everything from tiny portions of cooking oil and fresh eggs to candles and shoes. There are five shops in this area, including mine.

Open for business. Through sheer determination and the ability to overcome numerous obstacles over the past eleven years, Ginnis' general store, in remote rural Zambia, now enjoys sales turnover of more than £24,000 per year.
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I started my business in 1997. The first year it was basic farming. Most of the people here are subsistence farmers, and harvest is in June or July. I farmed maize and sold it in the local market. With the money I made from this, I decided to start trading in fish. It meant cycling along dirt tracks on my bicycle to the river - which is 68 kilometres away. It took almost the whole day to get there. I'd leave at six in the morning, and be there by 2pm. I bought fresh fish directly from the fishermen - big and small fish, perhaps around 50kg of fish in total - and then I'd hop on my bike with the load of fish and cycle back home again. We like to eat dried fish in Zambia, so I had to dry the fish on my return. It was all a lot of work, but there was a good market (need) for fish here - and no one else was offering it - so slowly I built up my business and was able to put aside some capital.

Next I expanded into groceries (including continuing with the dried fish), and this is pretty much where I am today. My customers are the people who live around here (and sometimes even visitors like you). I sell lots of batteries, for radios mostly. Probably every household here would have a radio.

Battery sales are good. Ginnis sells about 50 large and 10 small batteries each week. The most common usage is for radios.

For my customers' lighting I sell candles and kerosene (paraffin), although for months now there has been no kerosene at all as the costs have become too high, and supplies have dried up. Some people are travelling to Mkushi (about 66 kilometres away) in order to buy their kerosene, but now I concentrate more on candles. Many of my customers will come in daily to buy two or three candles for that night. I sell candles for 500 Kwacha each (about 8p), or a packet of twelve for 5,000 Kwacha (80p). Candles are now a cheaper source of light than kerosene: one litre of kerosene can cost between 7,000 and 8,000 Kwacha (£1.30), and on top of that you now have to add the cost of travelling to Mkushi.

With kerosene in short supply, candles are now the most common form of lighting in Fiwila.

I know that some people around here are using diesel in their lanterns - those that don't mind reducing their life span! Lighting is always a problem: candles, kerosene, diesel and batteries are all expensive. I'm sure that there is a strong market here for the micro-solar products that you've shown me - especially the solar lanterns. Even for the simple solar mobile phone recharger, I know that my customers will want to buy them. Most people around here are farmers: they could be out working in their fields while charging their phone. The solar panel is so light and simple, and it would save them time and money. Currently the fee to recharge a mobile telephone is 2,000 Kwacha (30p), and it takes about 3 hours.

When I need to restock my shop, I cycle to Masansa (28 kilometres away), make a booking to hire a 3-tonne truck, then cycle home. It costs 1.5 million Kwacha (£240) to hire a truck for the day, and on top of that I have to add the cost of petrol - currently around 9,000 Kwacha per litre (£1.40). I hire the truck for one full day: midnight to midnight. The afternoon before going to Lusaka, I again cycle to Masansa, then start off in the truck right on midnight. I drive, and either my wife or my teenaged nephew accompanies me. We usually arrive in Lusaka at around 6am. Then it's a full eight hours of running around Lusaka, buying stock for the shop. I buy wholesale, mostly from the Kamala town centre and city market. At 5pm we set off from Lusaka so that we can be back in Masansa on time to return the truck just before midnight. On average I would purchase around 14 million Kwacha (about £2,000) worth of stock in one of these trips, and probably do about eight such trips a year. Originally I shared the costs of this trip with another shopkeeper, but now I'm generating enough business to do the trip alone. My four competitors (the nearby shops) follow this same procedure to obtain their stock.

The prices in my shop are reasonable. To give you an idea, one tin of fish costs me 2,800 Kwacha (45p) wholesale in Lusaka. I add on 200 Kwacha (3p) to cover transport costs and 500 Kwacha (8p) as profit. So my customers can buy it for 3,500 Kwacha (50p). [Janelle's note: we pay 3,950 Kwacha (54p) for the exact same product in Lusaka - where shopkeepers don't have to deal with such challenging supply chain issues]

A few weeks ago there was a theft in this area. They hit all of the five shops here. It's the first time to happen to me. I reported it to the police, but there is not much we can do, and of course there is no insurance. I lost about 1.3 million Kwacha (about £200) worth of stock.

Probably my biggest business challenge over the past eleven years has been lack of access to capital. Everything I've done, I've built up slowly myself. I've never seen the internet before, but I've heard that you can buy second-hand vehicles from Japan online. This is my goal for the future: to invest in a truck of my own. It will be much cheaper for me to collect stock from Lusaka, and I could rent the truck out to others when I'm not using it myself.

Success story
Ginnis Moono is living proof that Africans can build and manage successful businesses-despite being forced to overcome countless obstacles that we in the developing world do not even have to consider.

Ginnis' tale is a success story: for Ginnis, for his family and for the community that he serves. Arguably, the best solution to reducing Africa's spiralling poverty is through job creation and income generation (that is, income generated from productive economic output, not in receiving mere handouts). It is SolarAid's mission to do just that - by providing access to solar technologies through its micro-solar projects.

Ginnis Moono (far right) makes notes at a meeting to examine micro-solar products, discuss market needs, and make plans to rollout micro-solar production in Fiwila. This meeting, arranged by SolarAid and HODI, included some key representatives from the community.

Micro-solar training
Next month - deep in the remote Fiwila catchment area of Zambia's Mkushi district - SolarAid will be training a group of entrepreneurs in microsolar technology. This will include instruction on the assembly of small solar panels, conversion of mobile phone rechargers, and of course building simple and low-cost solar lanterns.

Ginnis Moono will be one of these trainees, and there is little doubt in my mind that he will quickly build up a successful microsolar business, providing employment for some, and significantly improving the lives of thousands of rural poor in his area by offering cheaper and cleaner sources of energy.

On a personal note - with my being fresh out of business school and armed with an MBA - it is rather humbling to talk with someone like Ginnis Moono. There is probably very little that I could teach this guy about business management.

Janelle Tisserand
MBAs Without Borders/SolarAid