BEFORE YOU GO INTO THE FRESH FRUIT & VEGETABLE BUSINESS IN NIGERIA

I have keenly observed the consumption pattern of fresh vegetable in Nigeria.

Basically, the value chain comprises of both formal and informal. The formal value chain takes the route of the standard stores and supermarkets which have sophisticated technology for packaging, storage and distribution. The informal supply chain is made of local farmers, street vendors and market women with rudimentary packaging and storage and distribution technology. This supply chain is characterized by a high level of unhygienic conditions.

Furthermore, as a typical characteristic of an emerging economy, it seems to me that as the income and education level increase, the consumption of more of these ‘premium’ food products increases. In other words, they seem to be mainly an elitist food, as the people at the bottom of the pyramid (BOPs) seem not to be able to afford the high cost of good quality of these premium products but rather choose to go for cereals and legumes alternatives which are cheaper.

What’s the implication, from a business perspective? If you must run a successful fresh veggies business in Nigeria, you wouldn’t want to focus on the informal market for several reasons. First, the market is highly undifferentiated and controlled by some sorts of cabals which may be very difficult to break. They will use the experience to beat you. However, if you are smart enough to beat them at their game, you will be catching up lots of men. Secondly, I bet you the last thing you would want to do is to compete with someone who doesn’t keep an appropriate financial record. He/she can afford to sell at any price which may not be healthy for your business.

My counsel to young entrepreneurs is to enter the formal value chain and focus on meeting the aesthetic and quality demand of the elitists in the form of attractive packaging, and hygienic storage and distribution. If you will want to learn more about that, you can easily contact me.

On the other side of the coin, how do you think technology can help to make these products more affordable to low-income people?

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