The Legal Adviser of Golden Diamond Manufacturing Company, Barrister Frank Ndibe and his team in this interview with the trio of Bisi Adewumi, Susan Oni and Adenike Agunsoye of Nigerian NewsDirect Newspaper, bared his mind on the birth of the company, coping with funding, inflation, the burden of taxes, the supportive customers, the amazing achievements amidst the underlying challenges, their Corporate Social Responsibility packages, their target to become number one sanitaryware brand in African market and many more.
Can you give us the background of the company, how it all started?
Actually this company you are seeing started in 2019, just, about four years ago. You know, the idea of the company started in April, 2019. Basically, it’s a new newborn baby. The company was duly incorporated and is fully owned by Chinese investors. Chinese investors fully own it hundred per cent. A group of Chinese investors contemplated the idea and then started sourcing for the location, and this place presented a very good location for the establishment of the manufacturing company. Though it was very expensive to acquire. It impeded the capital, which they actually intended to use for the take off of the company. Nevertheless, over 60 acres of land were procured, so that it would encompass the factory, the accommodation and other facilities, warehouse, offices and so on and so forth. So the Chinese investors funded it hundred per cent. So, we started. This place you’re seeing was like a bush, thick bush with thick trees, virgin land. When I mean virgin, it was hundred per cent virgin. Nobody has entered and done anything. So it was cleared. In fact, I will say the only development around here then was Danco, that had a filling station. That was the best we could see. And then, another filling station we could see again was the NNPC mega station, some distance away. There was no other filling station on this side. It was when we came and we developed here that others were encouraged to start coming, and then, Winchtech. So basically, it was not an easy journey, but the decision was taken and steps were taken. A lot of funds were invested, and then, machineries were brought in from China. And it took off little by little. When it started, we had only one production line. It was not producing much. You know, and because of lack of fund, the company had to strive and strive and then brought in other machineries to commence the second line so that at least, it could produce enough for the market. So, it’s just about four years old company. But you can see how big it is now.
What was the magic behind the expansion in no time?
The determination of the investors! Some times, you meet roadblocks. But if you are determined and focused, that you’re going to do this thing and make it work, and make it a success, no matter what it takes, if it means borrowing money from China, from Nigeria, you will do it. So they had to do it.
How do you source for your raw materials, are they imported or they’re locally sourced for?
Yeah, You know, these are kind of products, in Nigeria, some 15 years ago, the history of our toilet system, bathroom system, in fact, in the seventies (70s), you know the horrible state of our toilets at the time. It was pits. Nobody knew about this. You only see them in
Europe, see them abroad. It was later in the eighties (80s) that people started importing them. But this, as you are seeing it today, the raw materials come from Nigeria. And also, some come from abroad, China, and other sources. We cannot have it all. It cannot become a finished product without having some materials imported. But basically, the raw materials are from here.
Is this global inflation affecting your operations in any way?
No investor actually will want his product to be very expensive. They want it to reach everybody. But in a situation whereby you find out that you are operating at a very high cost, the raw materials you are getting here are at high costs, the one you are importing, in fact, you need to get foreign exchange, and at a time, foreign exchange was N790/USD, it reached N800. So, something that you ordinarily would have used N2 million, N3 million to buy, is high up to N7 million. So, it’sreally affecting businesses and as it is coming, we have to also adjust the prices. We have to adjust the pricing, but not drastically, not too high, because we are conscious of the Nigerian market. If we take it the way inflation is biting, then we will not have patronage. Inflation is affecting manufacturing companies all over the nation. And you’ll see a lot of them going out of business, a lot are frustrated. They cannot even afford it. Concerning the materials we import, we were badly affected at the time we had COVID-19. We could not import. We were destabilised, but then, the man who is at the helm of affairs is a very determined managing director. No matter the problem, he must find the solution.
Nigerian market is flooded with different brands of your products. How are you leveraging?
We anchor our faith and belief in hard work and bringing out the best quality. The secret is that anybody in this kind of business must be conscious of competition, whether it is from abroad. We nurtured this factory to manufacture products that will compete with the best in Europe, look at them (points at some of the products). They will compete favourably with any product that is imported to Nigeria today. And then, the price is moderate to suit Nigerian pockets. We are conscious of the flood of importations. A lot of people import from elsewhere, China, from Europe, but as we are manufacturing, we want to take over the Nigerian market, our goal is to take over the African market ultimately. Our ultimate objective is to ensure that Golden Diamond becomes number one brand in the African market, the sub-regional market (ECOWAS) and the Nigerian market. The mention of Golden Diamond will give everybody a sense of belonging. It’s not too expensive and it is of top quality.
With infrastructural decadence, how are you coping with power supply?
Anybody nursing any ambition to start up this kind of industry must make alternative arrangement for power supply. If you dare intend to depend on Nigerian electricity, you’ll start failing from day one. So, from time immemorial, we have articulated intention to generate our own power. It cost a lot. You know, power cost a lot, buying diesel, gas to generate electricity. It takes almost, will I say one third of the investment. But you need it to survive. You cannot manufacture without light, and the quantum of power we need to manufacture this…. the oven doesn’t go off. It’s a 24 hour operation. It doesn’t go off. Anybody into ceramics and silverwares must keep it 24 hours, no blinking, because once it goes off, it means you will need the next seven days to start it up. The power is being generated by the company. We spend a lot, that’s the thing. That’s one of the problems Nigeria still has, and one of the challenges the new president will face. And we keep saying, the moment you give such infrastructure such as electricity, many companies will survive. Even the small scale businesses will survive. But where you expect them to go and buy fuel and diesel and run generator. For example, somebody who is running a barbing shop, every time you want to cut somebody’s hair for N500, you use fuel of over N1,000. It doesn’t make sense. We generate our own electricity. We don’t depend on the Power Distribution Company. That’s the truth.
What are your marketing strategies and approaches to feedback?
I will be honest with you. We don’t have any extraordinary marketing strategy. The strategy we have is first and foremost to make sure that the quality of our products are good. Once the quality of the product you are manufacturing is good and people are using it and they see it’s good, you have done the marketing by almost 50 per cent. And then, we have a basic network we use. People distribute our products all over Nigeria. We use distributors, which is common knowledge. It’s been the same thing all over, you know. But our strategy is to make sure that the quality of our products are good so that our marketers and distributors will not face any difficulty marketing the products. If people purchase this (points at a displayed WC) and install in their new houses, and every time you flush your toilet, it flushes and no stains left, you know there are some WCs , when you use them and flush, the next day, you see brownish stains. You need to buy bleach and all that every time. But ours is seamless. So, you buy this today, somebody would ask, where did you get this, what brand is this? And you answer, Golden Diamond. The next day he comes around to buy his. Many developers all over Nigeria are using Golden Diamond. You go to most public places, Golden Diamond has become a brand. So we market it by making it good. It costs us money, but we make the quality to be good.
Then we also do some level, you know, expected level of marketing. We have marketers who go from place to place introducing our products, because so many people may not know about it. So you need to really introduce it for people to know it. But once you know it and start buying, you know, you get stuck, introducing it to others as well. Then the feedback — feedback so far has been excellent, no complaints. Although, the only complaint is about the vagaries, breakages on the roads. People travel far, when they come and take the products, as they’re going, there may be accidents on the road. You know, the vehicle carrying the product having accident and falls. This is the kind of feedback we get. Please, give us discount or replace our products because there’s an accident, the driver was careless. But not that the product went bad or that the product cracked, none of that. We don’t have much complaints except by careless handling by people who purchase the products. It is a delicate thing, you know, they are breakable, you know, if you purchase it and mistakingly you drop it, it can break. But not that it will break of its own accord. The products last, they’re meant to last for as long as the house is there, or when you are tired of it, you change it. When there is a new design, you change it. Yes, that is it. So the feedback is excellent.
How favourable is the government policy to infant industries?
It has not been favourable. We keep making them realise this, you understand? We keep pleading for mercy, you know? And there’s no doubt that state government needs the taxes, the monies to survive. This company and many other industries are theirs. We keep begging them. Alright, please show mercy, especially to the young companies such as ours. The taxes are many and relatively too high. We bargain for reduction. At times, you have to fight it. You have to struggle. You plead and plead, write so many applications for waiver, until we reach a compromise. And so, we’re still pleading with the government, both federal and the state.
Is there any other challenge confronting the company aside those discussed?
Basically, the only challenge we have is, I would say, expected. It’s just funding issue. Getting enough funds to do all the things we want. Also, the challenges of paying back to banks, the heavy interests, and if government through the Bank of Industry is giving succour to manufacturing companies,if they give at very low rate, like some places where they are given at 6 per cent. But it doesn’t go round. It’s just a few that are benefitting. That’s basically the challenge — funding. But we are managing.
Where do you see the company in the next 10 years, your expectations?
Wow! May God help us (laughs). In the next 10 years? Yeah, alright, when we have management meetings, we really say this. And it has been guiding our actions. Everything we do, we look at the future. We want to remain number one. We want to foreclose the idea of importing our products from outside. We want our product to take over. So that it’ll be affordable. It’ll be of top quality and there’ll be no complaint, not just in Nigeria. We are going to West Africa sub region and we are moving in very soon. In fact, what is delaying us is just a few months — all the logistics and strategies are been marked out. We are moving into the West Africa sub region and also we want to conquer Africa. You understand? We want our products to be everywhere so that Africa will not have any need to import from Europe or elsewhere. To be the silverware brand to beat. This is the only business we do. So that is that.
How do you give back to the society, in form of CSR?
Yes, Corporate Social Responsibility, we are mindful of that, and we have started. Many officers, government officials, both in the state, Police, DSS, you know, we try to also promote our products by giving them the much they want. If you go to Lagos for instance, Zone II, the buildings they’re making up now, we supply them free of charge, give them free of charge. As a lawyer, when I was much younger than this — I’m 30 years at the bar now — you move into the toilets, if you say you want to go and ease yourself, you cannot even do that. Yes, so we started by giving to such places. And also the government, this programme they are doing, you might be aware of it that they don’t want open defecations. The day they did it, I had to personally go myself. And we took our products and we went and I told them, use our products for the toilets you are building so that people will not turn every part of state to toilet, and we gave them. Apart from that, we give to the society, the poor, the downtrodden in the society. We try to give them. And one thing with our MD is that he’s not the kind of person that when he gives to the right, he allows the left to know. We don’t blow our trumpet. We do that and we intend to do more, even though we are still struggling. Yes, we intend to do more. We intend to build things for the community where we are. We want to make our presence felt in schools too, to donate to them, for the children. It’s a kind of doing something for the society. We have also built a kind of hostel accommodation for our staff and their families. We give them two meals in a day.
What do you want to tell both the government and your customers?
To our consumers, we say we appreciate them, because they are buying our products. No matter the quantity you manufacture, once it enters the market, the dealers come the next day, they line up, queuing for more. They are buying, we appreciate our customers. Again, the consumers, they are doing well and we appreciate them too. We ask them to continue to patronise us and we give them the assurance that we will never let them down. We are committed to bringing out good quality products. Yes, at any time the economy bounces back, and inflation comes down, all our prizes will continue to be favourable.
And, from time to time, we will also show them appreciation. During Christmas we give gifts, we make hampers and spread them round to some of our customers, diaries, pens, calculators, we do that, to just show appreciation. Yes, so we appreciate them. We encourage them to continue to patronise our products. But for the government, yes, we will continue to appeal. We continue to plead. The government should understand the sensitive predicament of most companies into manufacturing. They are operating at a very hard circumstance, especially financial. They should not be expecting too much from companies, especially the infants. It shouldn’t be a cash cow for government. Rather, the government should appreciate that these companies are creating employment, solving some issues for the government. Because as we are employing over 2,000 people here, okay, we have solved some problems for government. These people would have been on the streets. But yeah, we have solved that. So, let them show mercy, especially the the growing ones. Let the taxes be reasonably minimal. Governments at all levels should create an enabling environment for companies to flourish. We give support and government should also reciprocate by giving us support.