African Things have been very fortunate, but just like any other business; we have gone through many challenges. Internally, we had to deal with the high turnover rate of staff. As a small company, we do not have the money to pay for highly qualified staff and when we were able to get skilled graduates, they get experience and then moved on to other companies that could pay them more.
I also had to deal with quality control problems; we went through so many producers in hopes of finding the right partners who also had attention to detail and delivered quality on consistent bases. Even now we have to ensure that we put in quality control measures to ensure our producers never get comfortable with giving the bare minimum or expect us to ‘just manage it’.
Externally I still have challenges getting my target market to be aware of the company, building up brand awareness among giants like HP, Targus, and Compact, who also sell backpacks and laptop bags has been difficult. The real challenge is getting people to trust the brand and changing their negative image that Made in Nigeria products are of less quality.
The increased exchange rate also has a huge impact on the business as even though most of my products are made in Nigeria, I had to increase my prices, as 100% of my raw materials are all imported and increased in cost. I had a hard time explaining this to the stores I supplied to, as they felt I was taking advantage of the situation at the time.
Managing our accounts and inventory has and still is one of our biggest internal problems today. In the beginning days of the company, we did not have a company account, I was using my personal account and spending the money as quickly as it came in. I did not have any accounting system to know how much I was spending and if I was making a profit or not. I still remember the ‘eureka’ moment when I realized that I was not accounting for my travel expenses and I was only focusing on the production cost and had failed to look at all the other additional cost that went into running the business such as transport, mobile credit, marketing and more. I remember feeling like I made money but did not know where it all went.
We now use wave accounting to manage our finances and also an inventory management system to ensure that all our products are properly documented. We know where every product goes to and how much money we are spending. It is not perfect but with the aid of my training from Lagos Business School, I am getting more knowledge on what needs to be done.