December 2020 – Prime Time Communications

News

#OutToLunch Kiira Motors shouldn’t be selfish with Edward Hightower

By Denis Jjuuko An interesting report by the BBC titled “climate change: dangerous and dirty used cars sold to Africa” says 14 million used cars were exported from the US, Europe, and Japan between 2015 and 2018 and dumped in developing countries including Africa majority of which (80%) didn’t meet safety and environmental standards. There are about 1.4 billion cars in the world and the number is expected to reach two billion by 2040. Most of this growth is taking place in developing countries and emerging economies in Africa, Asia, and Latin America. In East Africa, the industry stood at 257,000 cars in 2015 and is expected to grow to 630,000 cars by 2030. Of these, brand new vehicles are about 15% while imported used vehicles stand at 85%. By importing these vehicles, we deny our young people the jobs they need to live meaningful lives. We have convinced ourselves that we can’t do big projects such as making cars — something that has been done for more than a century elsewhere. I have a friend who used to work as a teacher in a primary school in Kireka who made a successful US green card application and relocated to a mid-western state. Once there, she started looking for a job and within a month she had landed one and started working at a car assembly. She didn’t have any automotive skills and she had never worked in any factory before. Once she was hired, she received a one-week orientation on how to fix parts on a compact SUV. If a primary school teacher can be retooled within a week and she starts making 480 cars over an eight-hour shift, can’t that be done here and reduce the dumping that the BBC reported about? There are hundreds of graduates on our streets. However, there is a need to learn from the best and build structures and systems that can grow our nascent automotive industry. I learnt over the weekend that Kiira Motors had hired Edward T. Hightower as its automotive industry advisor. I follow Hightower on Twitter and had read some impressive reviews about him and his book, Motoring Africa. I was excited that somebody of his status can accept an advisory role in an ideally small start-up in Africa. Hightower, an engineering graduate of the University of Illinois at Urbana-Champaign and an MBA from University of Michigan Ross School of Business, has worked in several new-product design and engineering, strategy, brand marketing, and senior executive roles between Ford, BMW, and General Motors. He led GM’s $15 billion global crossovers business as the Executive Chief Engineer and Vehicle Line Executive, planning and developing the Cadillac XT5, GMC Acadia, Chevrolet Traverse and Blazer, Buick Enclave, Holden Acadia, and other platform variants. These vehicles are sold in many markets around the world. Hightower also served as Chief Engineer for Ford’s full-size SUVs – Excursion, Expedition, and Navigator as well as BMW’s Brand Manager for the 5, 6, and 7 Series models in the US. I believe his involvement with Kiira Motors will put a spotlight on our automotive industry and open opportunities for Uganda leading to localization in the manufacture of car parts and the development of the automotive value chain. Many investors in the automotive industry and emerging markets should be interested in what makes a global executive work with a small firm which is just building its vehicle production plant outside Jinja town. Global executives don’t usually just go for the money because they have names to protect and see opportunities that others don’t necessarily see. North America, Europe and some parts of Asia are already saturated when it comes to the automotive industry, so the growth like the BBC article alluded is right here in Africa. I hope that Kiira Motors won’t be selfish and make Hightower accessible to other entrepreneurs so that they (business people) can see opportunities in the automotive industry value chain. Even if you don’t believe in Uganda making cars, we already import many of them in the country and the region each year. These cars need parts but the majority are imported. The late James Mulwana learnt many years ago that the automotive industry is a key driver of the economy and invested heavily in his Uganda Batteries outfit. Today, I believe we don’t import as many car batteries as we would be had Mulwana not set up his business. Can’t we make wipers, brake pads, bolts and nuts, spark plugs, and the like? A car has on average 30,000 parts. Hightower should help us see these opportunities. The author is a communication and visibility consultant. djjuuko@gmail.com

December 9, 2020

News

#OutToLunch The car industry is ready for the taking.

By Denis Jjuuko Cars are the second-highest value import in Uganda after petroleum products. It goes without saying that the majority of the petroleum products imported are used in cars, making the automotive industry one of the biggest in the country. In many countries, the automotive industry is a key actor in the economy where many independent small and large enterprises supply parts that put together to make a car. Cars also naturally use a lot of consumables once they are off the assembly lines — fuel and oil to grease the parts of internal combustion engines and many other parts. We saw during the 2008 economic meltdown that the United States moved swiftly to bail out their auto industries as they create millions of jobs directly and indirectly. With poor infrastructure and lack of reliable public mass transport, the automotive industry has enormous potential. Once many people in Uganda get a somewhat meaningful job, one of the first assets they spend their money on is a car — many times a fifth hand they spend more time under repairing than inside enjoying. A few years ago, I witnessed a transaction that amused me where somebody bought a very old car. The transaction took place in a famous restaurant in Kampala in the evening. The buyer came with about five friends and once he received the car logbook and keys, the party started. His friends high-fived and hugged him and all admired the car after which several drinks were opened and enjoyed. The buyer sat in the middle cross-legged, like a prince. You could tell his friends admired him immensely wondering when they will be able to achieve as much as him. One of their own had become “middle class,” he was now a “my car.” Young men tell me that these days girls of their dreams first inquire whether they have cars before they decide whether to date them or not. Once they own a car, the question of which car is also asked. I don’t know why one would be so interested in a car that doesn’t belong to them but I think I have heard that it is easier to cry in a car than on some ramshackle bicycle! A car isn’t just a means of transport; it is a status symbol. You may argue that we are exchanging values for possessions but that is the reality today. You have heard about washing bay workers in Wandegeya crashing their clients’ cars around hostels where female university students reside or those who thought they had landed on a young millionaire just because he had access to car keys. I remember during my university days, a young man who bought a car key and dropped it on the table the moment he sat down to create an impression that he had a car whereas he didn’t even know what a gear lever was. We always laughed at his theatrics. As long as people migrate from rural to urban areas to escape poverty and the cities or towns remain with poor public mass transport, a car will be one of the most important assets people will ever buy. We won’t be like in some countries in Scandinavia where a prime minister rides a bicycle to office. Ugandans also love buying and building their own houses which are now located 20km or more from their workplaces. Those who are joining universities today will live further away from the city. They will need cars to ease their mobility unless significant investments are made in public mass transport. The majority of the imported vehicles are very old and susceptible to frequent breakdowns, which creates massive opportunities. Uganda is also developing its automotive industry with the construction of a plant in Jinja nearing completion. With poor or non-existent mass public transport as mentioned above, Uganda’s automotive industry potential is enormous and due for disruption. Technology advancements in 3D printing and availability of machinery on the world market mean that an entrepreneur can start looking for opportunities to make some of the parts right here in the country. We have the raw materials and a market that is so huge and ready for disruption. What one needs is to think of ways to disrupt the industry as it is ready for the taking. The writer is a communication and visibility consultant.djjuuko@gmail.com

December 9, 2020

News

#OutToLunch Lessons from Sekanyolya’s 20 years of remote-controlled gates

By Denis Jjuuko Research from an international body shows that Uganda is the most entrepreneurial country in the world. Many adults are involved in businesses as owners. Others have ambitions of starting businesses. Many of the employed workforce have side businesses that they run whenever they find time off their official employment schedules. In our markets, millions of people are self-employed, running stalls of so many things. Graduation parties are full of speeches urging people to be ‘job creators.’ However, many of these businesses collapse before their fifth birthday leaving owners either in debt or with egos more bruised than that of Donald Trump after losing re-election! Given that kind of background, I am always excited when I come across a Ugandan company that defies the odds — enters the big league and survives for many years. This is because Ugandan entrepreneurs don’t fail because of being lazy or lack of trying. Doing business is a lot of work this side of the world — expensive capital, an untrained workforce, a poor population, an environment generally that isn’t pro-business. Over the last few weeks, Sekanyolya Systems, a pioneer in security systems has been running a show on NBS TV every Sunday evening to celebrate its 20th anniversary. It is remarkable how far the company has grown to the extent that it can even have its own televised show to celebrate its achievements. For disclosure, I know the founder of Sekanyolya Systems — Elijah Zizinga and I consider him one of my mentors. As a university student 20 years ago, I always approached him every October to do ‘kyeyo’ during the UMA Tradeshow, where I worked as a support sales agent for the week-long exhibition. Once in his company, you will always learn a thing or two about business in Uganda. Like many genuine Ugandan entrepreneurs, he is media shy and rarely gives interviews. He abhors self promotion. He always prefers the Sekanyolya brand to shine. And he has worked so hard to ensure that the brand is out there. At every building where his security systems are installed, a label of his brand is put in the most prominent place. Razor wire is known as Sekanyolya same way people used to refer to every detergent as Omo! For many years, there was always an advert every day in the newspapers and occasionally on TV and radio about his company. I think he believes in a common advertising thesis that posits that “doing business without advertising is like winking at a girl in the dark—you know what you are doing, but she isn’t aware of what you are doing.” Many Ugandan entrepreneurs are quick for self-promotion showing off their fifth-hand SUVs and gigantic homes and trying as much to show how they are wealthy whereas in real life they are suffocating in unbelievable debt. You will never see Zizinga showing off or claiming to be wealthy. This a critical lesson for entrepreneurs because trying to live rich has left many in debt, crippling their businesses. In the earlier episodes of the Sekanyolya Security Show, Zizinga gave a rare interview of how he moved into the security systems business. While going through a yellow pages book (a list of mainly business addresses in the pre-google days) of Johannesburg, he saw an advert that intrigued him — remote controlled gates. He flew to Johannesburg for an exhibition where the company that made these gate systems was showcasing its products. The more he talked to this company, the more he realized that this is a business opportunity he could bring to Kampala. It is a key lesson for entrepreneurs — reading is essential. I know many people in Uganda don’t want to read but if you are going to succeed in most things, there is need to be alert by consuming a lot of media through which ideas surface or get refined. Reading is also said to be one of the ways through which you can exercise your brain. I know that many Ugandan entrepreneurs cannot read or write but there is a need to learn to do so. I know some business people who have taught themselves these things and have become even more successful. So if you are an entrepreneur who flies to Asia or wherever for business, you can always look for the English newspapers or magazines and go through them or surf the internet as much as you can. Like the founder of Sekanyolya, you may find an advert that changes your fortunes. The writer is a communication and visibility expert. djjuuko@gmail.com

December 9, 2020

News

#OutToLunch Opportunities for entrepreneurs as demand for wood doubles

By Denis Jjuuko The biggest source of energy in Uganda is said to be wood, which many households use for cooking and sometimes even lighting. Some of the households which may not use wood as we may know it, use charcoal, a byproduct of wood. A joint statement by Uganda Bureau of Statistics and the World Bank Group released last week painted a very grim picture for our country. “Uganda could run out of forests outside of gazetted protected areas by 2025, if the current rate of depletion, driven by population growth, urbanization, and poor management of natural resources is not checked,” the statement read in part before offering an opportunity for entrepreneurs. “Demand for wood is projected to more than double between 2015 and 2040,” it said. There will be demand for wood in the country, which may not be available around after 2025 given our rate of depletion. I highly doubt that the current rate of depletion will be checked in the next few years. So if you invested in a wood business today, in about five years or so, you will be smiling to the bank. You could plant fast-growing trees that will be ready for harvesting starting 2025 to meet the demand for wood as many people including high-income earners still need wood or its byproducts. I have heard many say that they can’t imagine eating Matooke that isn’t cooked on firewood or traditional charcoal and in many urban homes of the wealthy, there is an ‘outside kitchen’ where firewood is used. Apparently, they argue, Matooke cooked on LPG or even electricity doesn’t taste as nice. Schools and prisons depend a lot on firewood to cook their food while some modern hotels use firewood to lit up the sauna and such other facilities. However, they don’t have to as they produce enough raw materials for biogas, which is another opportunity for entrepreneurs. Homes, schools, prisons, hotels, and even offices create a lot of organic waste that can be turned into biogas, which can light up our homes and provide a source of energy for cooking. This would actually check the rate at which forests are being depleted. Entrepreneurs can invest in modern systems where households and other facilities mentioned can sort waste and use it for biogas. We love Matooke in this country, which creates a lot of waste which can feed the plants for biogas and then create the fertilizers that can be used in the gardens. But also, studies show that about 40% of the food that is cooked is not eaten. Just observe at functions how much food people pile on their plates and then look at the workers as they collect the plates after people have eaten. This food is usually thrown away yet it can provide the energy we need to wean ourselves off firewood. There is also human waste from which biogas can easily be created. However, there is stigma about it. One of the so-called modern schools in this country whose alumni boast about it at any opportunity they get once installed a good biogas system so it could cut down on its costs spent on wood. The biogas system once complete started providing the energy needed to cook the students’ meals. The students went on strike that they can’t imagine they are eating food being cooked using ‘pupu.’ To quell the strike, the school promised to return to the old ways of cooking — using firewood. The students celebrated. They had won. So for biogas and alternative sources of energy to work, there is a need for awareness campaigns so people get to know that there are more ways to cook food than solely depending on firewood. This is the work of the government and I have heard that the Ministry of Energy and Mineral Development is launching a pilot campaign in Kampala, Jinja, Mbale, Masaka, and Mbarara with support from UNDP to promote the use of organic waste as sources of energy. If this campaign kicks off, then entrepreneurs can start to position themselves to install affordable systems so that electricity is generated. Uganda has also been building its capacity in electricity generation over the years. Isimba and Karuma dams as well as others under construction should be making electricity affordable for households and businesses to use to cook food. Of course, there is a lot of investment needed in distribution but electricity in homes should be affordable enough for people to use for cooking so that we can reduce the strain we are currently exerting on the forests. The writer is a communication and visibility consultant. djjuuko@gmail.com

December 9, 2020