Hans and Monique Crombach- The Nigeria Experience
For this interview, we visit Nigeria. A country that is a region on its own and houses many extremes: many people living in poverty while you discover abundant wealth in Lagos, Abuja and other major cities. Nigeria has a reputation that doesn’t do justice to the kindness of its people while at the same time facing some serious and interrelated economic and security challenges. The numbers are dazzling though! But sometimes maybe a bit deceiving. With Nigeria starting to get the attention it deserves from both the Dutch public and private sector, it is important to take notes from people who lived and worked in this electrifying country for decades. Hans and Monique Crombach are such people and we had the pleasure speaking to Hans about their experiences, observations and perspectives.
Hans, how did you end up in Nigeria?
A Belgium friend I met in South Africa took up a job with a cocoa exporting company in Nigeria. I worked in South Africa for some years where I met Monique who later joined me in The Netherlands and Germany where I was working with Royal Sluis Seeds. We both found working and living in Germany too regulated. In the summer of 1987, my Belgium friend called to ask if I was interested in a job in Nigeria with the same company. I went to Nigeria in July and Monique Venema, that time my girlfriend, followed in January 1988.
I worked for a Belgium company exporting agricultural commodities, mainly cocoa and sesame seeds but also rubber, hibiscus, ginger, etc. Communication in the country was very basic and we, as well as our competitors, were entrepreneurs learning on the job. In those days, there were mostly London based organizations active in the sectors, about a 100 International Trading companies were in Nigeria at the time, while there were 3 - 5 companies exporting sesame or ginger from Nigeria including the company I was involved in. In 1995, I left the company and started working for a Swiss Importer who was keen to start an export division for the same old reason; generating Forex for import. Being the Naira converter of the group didn’t give the management urgency for innovation or expansion. At the beginning of 1998 we were at cross roads; leave Nigeria and invest in a company in The Netherlands, South Africa or to continue the export business for own account (with my former boss as partner). In 1998, we started Afri Agri Products Ltd. and continued trading: cocoa, sesame, ginger and chilies and even ventured in 2000 into production of herbs and spices as basil, fenugreek and later diversified into vegetable production. The farm was located in Kano State with major challenges; not being on ground, repairs & maintenance and logistics to bring vegetables down to Lagos.
We were one of the first vegetable suppliers to Shoprite which is major retail store in Nigeria. Monique can proudly say she introduced sweet corn and some other vegetables in the Nigerian retail market but we never made money from operations, so we stopped vegetable production in 2006 when Monique left with our two sons back to The Netherlands for their secondary education. Also, the commodity trade became more difficult with the roll-out of a mobile telephone network all over the country. This mostly due to moral hazard issues from information asymmetry.
Suppliers always heard when commodity prices went up but never received the news or refuse to disclose when prices came down. Demands for export commodities increased and therefore suppliers hardly honored forward contracts. This makes it impossible for a small player to operate in an International setting where they keep you to your commitment. As I said, Monique went back to The Netherlands with the children to complete their secondary education while I was travelling back and forth almost every 4 – 5 weeks. This was probably the hardest decision in our married life but trust me we do not regret that our boys speak our “Limburgs” dialect fluently, feel at home in The Netherlands while still being very connected to Nigeria. My older son already joined me in the business!
“The only pleasure in commodity trading is making money!”
How did you move beyond that point?
Basically we turned the business around. We went from exporting Nigerian raw materials to Europe to importing high quality Agricultural inputs into Nigeria. In 2008, Koudijs Animal Nutrition B.V. approached us and we dedicated our company Terratiga Ltd. In developing the Nigerian market together with them, Koudijs introduced us to their worldwide after-sales philosophy; we will guide your farm towards achieving the potentials our products provides you. We are not price fighters but supply high quality products for a reasonable price. We mainly work with professional farms and they can be of small, medium or large size. One thing they have in common; they all want to grow the farm in size and in profitability. There we created our slogan to be ‘’together for better results’’! We find it very rewarding when we see our customers business growing!
Monique basically did the same but in the horticultural sector. Afri Agri Products represents Enza Zaden and Pop Vriend Seeds, importing various growing mediums, water soluble fertilizers, trace elements and irrigation equipment. Nowadays we do around 75% feed Animal Feeds and 25% horticultural Inputs.
What made us to stay that long in Nigeria and the business, was that our days are never boring, not always in positive sense but still you feel very good in the evening when you have solved a major “Nigerian problem” during the day. Further you have to love your job because Nigeria requires long hours and many times even micromanagement. This runs from Finance, Sales to cleanliness of offices and toilets but maybe, I’m extreme! But overall Nigerians are very much willing to work and have a great sense of humor.
“Nigerians have great sense of humor”
How did you see the agricultural sector develop over the years?
While Nigeria needs local and specific solutions due to its size and deteriorating road network. I see the future for our sector in regional production of raw materials, food stuff etc. The family owned SMEs that can provide that kind of flexibility have a hard time competing with large and multinational companies. Through the years, I have seen big companies coming into Nigeria and taking up market share by destroying traditional supply lines. Of course the market has to innovate and increase their productivity but I’m not sure if eliminating this infrastructure helps Nigeria, and us Europeans in general when we take these peoples’ livelihood away through unfair completion and lack of integration. This is not a level playing field, the Big companies with special loans and grants against regional players. The big guys mop up for example the raw materials in the season, forcing SME’s to buy or trade their end-products. Many of our customers want to produce their own feed but are constrained because of availability or high prices of inputs due to speculation. At our company we provide regional entrepreneurs with more knowledge, better inputs and equipment. We want them to continue to fish and not to sell them the canned fish. We always go for a win- win scenario in Nigeria.
“Don’t let the demographics fool you!”
What would be your priorities looking at Nigerian agriculture?
What this country needs is more technical and vocational training in the technical and Agricultural sector. This provides a mindset for knowledge, practical implementation, logical thinking, discipline and tidiness.
Bringing these companies to Nigeria requires much more support from the Nigerian government. Facilitate easy establishment and operation of agribusinesses, enabling import of quality inputs and expertise into the country. Approach these companies as partners and not as cash cows for all kind of Government parastatals. This will make production in Nigeria more competitive, encourages foreign investment, employs people and ultimately improves the security situation. We need the Embassy to help us with these problems.
Investors on their part need to have a long-term strategy and shouldn’t be fooled by the demographics! 200 million people growing to 400 or 500 million gives big numbers but you’ll be very disappointed when this population doesn’t consume even an egg per week and purchase power is unfortunately even declining for these big masses.
