[dropcap custom_class=”normal”] Export is one of the major ways I believe the Nigerian market can maximise it’s potential. Most people I’ve met, get to know my stand on import and export before too long.
It is not an hidden fact that I am always on the campaign for exportation of quality made in Nigeria products. This is one of the drive behind Bellafricana. We aim to bridge the gap between the producers and the local & global market.
In this post, one of our Bellafricana Verified business owner shares her first hand experience with the export process. Her name is Achenyo Idachaba, she is the Founder and CEO of MitiMeth, a made in Nigeria initiative that solves environmental problems while creating employment opportunity for the people.
It is always important to learn from each other and pass the lesson learnt on. This is why we would like you to follow Achenyo’s write up closely, you might learn something priceless here too. She writes… [/dropcap]
During the months of August and September 2016, Lionesses of Africa published the names of 41 Nigerian Women Entrepreneurs putting Nigeria on the Global Map. A BIG thanks to Melanie Hawken of Lionesses of Africa for the feature and for sharing this report with the world.
I was humbled by the fact that I was included on the list amongst several amazing trail blazing entrepreneurs. Each of us plugging away despite and in spite of the challenges in the Nigerian business operating environment.
Interestingly, the featured entrepreneurs were all in the non-oil sector. I have been privileged to know a number of the women on the list both professionally and personally and our sheer determination to succeed against all odds (erratic power supply, inadequate logistics, lack of skilled resources, corruption and the list goes on).
These added costs render most locally made products uncompetitive in the Global marketplace which is an injustice to the SMEs which are the backbone of Nigeria’s economy. It takes nerves of steel and nothing but the grace of GOD for any SME to carry-on.
Part of my frustration lies with the fact that Nigeria chooses to remain stuck in the stone age rather than advance into the information age. Relevant information simply does not exist in the public domain.
The pertinent question is “how do SMEs firmly sustain their position on the global map in the absence of the essential technical support and enabling structures”? We are earnestly seeking answers.
I recently returned from Dortmund, Germany where MitiMeth had the unique opportunity of being part of a GIZ Delegation Tour and also participating in Fair Friends 2016, an international Fair Trade trade-fair. We joined 16 other organizations from 12 other countries in this programme organized by GIZ and supported by the State Chancellery of North Rhine-Westphalia.
This was MitiMeth’s first International Trade Fair. Our first “up close and personal” interaction with other social enterprises from across the world most of whom were already exporting products.
We networked with and asked questions of our fellow delegates and all were open and willing to share. We gleaned best practices from CRC in Kolkata who has been exporting to the German market for close to 20 years.
The FAIR 2016 opportunity gave us a glimpse into the expectations of the German market also gave us firsthand experience of exporting through the formal channel(s) in Nigeria. For MitiMeth, there’s no other alternative but to export through the right channels.
After going through the “process to export” firsthand, I would like to share lessons learned along the way with my fellow entrepreneurs who are looking to export “made in Nigeria”.
Lessons I Learned in Export Processing
The strategy from inception was to take MitiMeth products to the Global Marketplace. We wanted to tell the Nigerian story beyond the borders of Nigeria. A story of transformation, hope, culture and development.
As our business model evolved, I sought information as to how we could sell MitiMeth products in stores in the U.S. I registered MitiMeth at the BOI-AGOA resource center but nothing has come out of it as of yet.
We registered 5 years ago and we haven’t exported a single item to the U.S.! I then started making inquiries during my trips to the U.S.
A number of Retailers indicated they only sold products made by Fair Trade members. That was how I heard about Fair Trade and the World Fair Trade Organization (WFTO).
I did my research and found one Fair Trade member in Nigeria. I sent an email but never got a response. Fast forward a few years later (2016), I reached out to KICK, a social enterprise in Kenya for some Technical Assistance.
They visited MitiMeth in Ibadan and we had the privilege of sharing best practices and exchanging information. KICK products are already being sold in the International markets and it was through KICK we were now connected to the WFTO Regional Director for Africa. It was through our interaction that I also learned that the Fair Trade member in Nigeria whom I had contacted was deceased.
Lesson learned: To sell handmade in the European and U.S. markets, it is advisable to get the business or product certifications required to sell in those markets.
Networks and Connections
KICK connected me to the WFTO Regional Office in Africa and I followed up immediately. We had a teleconference call and I had the opportunity to learn more about WFTO and to tell the Regional Director about our work at MitiMeth.
At the end of the meeting, the Regional Director gave indication that MitiMeth was a potential Fair Trade member. He was going to send me membership forms to complete. In addition, he told me about an upcoming Trade Fair, Fair Friends 2016, for existing Fair Trade members and a few slots for potential Fair Trade members.
He emphasized it was a competitive process and the Fair application deadline was a couple of days away. I indicated I was interested. I subsequently received the WFTO membership forms and the Fair Friends application.
I did not waste time completing the Fair Friends application. To cut a long story short, MitiMeth was selected to participate in Fair Friends 2016 and the GIZ Delegation tour. The GIZ selection team loved our products and they loved our story. That was how MitiMeth ended up going to Dortmund, Germany.
Lessons learned: Time is of the essence. Nothing ventured, nothing gained. Had we delayed contacting the WFTO office, we would have missed out on the opportunity to apply for FAIR FRIENDS 2016.
Logistics and Handling
Overseas Customs Duties/Tariffs: You will need to have the HS code(s) for your product(s) in order to find out the tariffs specific to your product(s). To find your HS code(s), you can visit the following ITC site.
If you are shipping to countries in the EU, you will need to visit the following EU site for information on the tariffs you would be required to pay. If you are shipping to the U.S., you will need to visit the following link for tariff details.
If you’re lucky, your product may qualify under AGOA and you may be able to ship your product duty free. We also found out from our fellow delegates on the GIZ tour that you can use a GSP certificate to export certain locally made goods into the EU duty free. This was very valuable information we got to help us with future exports.
Airports and Cargo Airlines: It is important and cost effective that you choose the international airport closest to you and an airline that flies direct to the receiving country. If there are airlines that ship directly to your country of choice, it is highly recommended you contact them directly. For example, Lufthansa Air Cargo, Delta Air Cargo etc.
The more you ship, the less the shipping charge. You get the best break if you are shipping 100kg or more. There are also other “logistics” companies at the NAHCO terminal.
What we discovered (the hard way) is that the “logistics companies” are middlemen and out to make their own cut. We ended up working with a logistics company at the terminal because they claimed Lufthansa Air Cargo does not deal with customers directly. NOT true!
We able to contact the Lufthansa Air Cargo directly a few days later and we found them to be more transparent and upfront with their process. We informed told by Lufthansa Air Cargo that freight payments should be made directly to Lufthansa and NOT the agent handling the documentation processing.
NAHCO Exports Terminal: The NAHCO Export Terminal at Lagos has been cleaned up significantly compared to a few years ago. That notwithstanding, the touts still hang around the gate waiting for their next victim or customer.
You need to be very cautious and alert! You’ll have to pay tolls at least three times within the Terminal complex so be prepared. One toll to enter the terminal. Another to unload your car at the warehouse (even if it is 1 minute!) and another to park your car.
The day we went it was nothing but complete and utter chaos. It is important to know that the warehouse shuts down for an hour in the afternoon while the staff take their lunch break. At 4pm sharp, the warehouse closes for the day! Is Nigeria, REALLY serious about exports? Clearly NOT!
Agent: We tried shopping for Agents on-line but it was an exercise in futility. We found a few Agents and we got a very wide range of price quotes.
Some quoted the shipping fees in Naira and some quoted in US Dollars at which point we decided to pack our goods and head to the Lagos airport to figure out things for ourselves. We found an Agent by knocking on one of the office doors at the NAHCO warehouse.
You need an Agent for document processing. The Airline Cargo offices do not handle document processing for shipments and understandably so. The Agents understand the chaos and the how the system at the Export Warehouse ‘works’ i.e. ‘settling’ of officials to get the necessary signatures.
Packing: It is best you come to the warehouse with your goods already packed in boxes but not sealed too tightly. Alternatively, you can come with your packing supplies to pack on-site e.g. cartons, packaging tape, fragile stickers, etc.
Your Agent can get the tape and fragile stickers but the cartons are quite expensive at NAHCO. A used carton that costs N150 outside costs N1,000 at MMIA! Everybody has got their hustle going on side.
Your packing should be easy to open for manual inspection by NDLEA and Customs. If you are there, you can monitor how your goods are repacked but if you aren’t present you are at the mercy of the Agent to pack your things neatly and properly. My products are fragile so I am a bit paranoid about Agents repacking my goods after inspection.
Fragile goods: From what I could see in the chaotic warehouse, transporting fragile goods is a dicey affair. First and foremost, the warehouse is a “free for all” facility with all kinds of people traipsing in and out and/or pacing up and down the place.
I witnessed people stepping on packed boxes and using them as stepping stones to get to where they were going. They tossed boxes around without any acknowledgement of the fragile sticker labels.
It is very unlikely your Agent is going to stand guard with your goods the entire time. S/He is going to be busy pursuing getting the necessary “stamps” required for your documents. As such I’ll advise that you pack your fragile goods in reinforced boxes or wooden crates.
Track and Trace: I was pleasantly surprised to find out that you can actually track and trace your shipment online. All you need is your Airway Bill Number. With that you are able to see when your goods left Nigeria, on which airline, and when the goods arrived at destination.
Lessons learned: All of the pointers above. Hopefully, they have helped to shed more light on the export process at NAHCO in Lagos. My hope is that the Nigerian government will transform the NAHCO Warehouse into a world class export facility. In doing so, the 41 Women Entrepreneurs in the Lionesses of Africa publication and more would have the enabling structures in place to take their ‘made in Nigeria’ products to the Global Marketplace.
Lastly, a note of appeal to the Nigerian Export Promotion Council (NEPC), the Ministry of Aviation and all other government agencies responsible for providing enabling structures to facilitate the export of Made in Nigeria goods to other parts of the world. Things MUST change. Please, please, please.
- Invest in a functioning website which provides details of services rendered and service providers licensed to operate from the NAHCO warehouse(s). Company names, Contact Persons, Phone numbers, Website (if applicable), Email address. If a website is too costly to maintain, consider getting a page set up on Facebook.
- Invest in Warehouse appropriate technology & equipment: A few x-ray machines, scanners, fork lifts, pallets and perhaps drug-sniffing dogs. The facility is overdue for an upgrade into the 21st century. The layout of the current warehouse facility cannot meet the expectations of a country promoting zero-oil exports.
Written by Achenyo Idachaba, founder of MitiMeth. To know more about Achenyo, CLICK HERE.