Nigeria holds great promise for investment world, says Kapoor
The Global Chief Executive Officer of Reckitt Benckiser, Rakesh Kapoor was in Nigeria last week on a working visit to the country. Before he returned to his base in Slough, United Kingdom, he spoke with Business Editor, ADE OGIDAN, on the economy and germane industry issues. Excerpts.
How would you briefly describe the operational profile of Reckitt Benckiser (RB) Group?
In Reckitt Benckiser Group Plc, we manufacture and market household, health and personal care products through over 60 operating companies in nearly 200 countries. The company analyses its revenue based on health, hygiene, home and portfolio brands together with RB Pharmaceuticals and Food. The company’s geographical segments include Europe and North America; Latin America, North Asia, South East Asia and Australia and New Zealand ; and Russia and CIS, Middle East, North Africa, Turkey and Sub-Saharan Africa . The company’s key brands include Durex, Gaviscon, Mucinex, Nurofen, Scholl, Strepsils, Airborne, MegaRed, Move Free, Bang, Clearasil, Dettol, Finish, Harpic, Lysol, Mortein, Veet air wick, Calgon, Vanish and Woolite. It also makes over-the-counter pharmaceuticals such as analgesics, antiseptics, flu remedies and gastrointestinal medications and offers products for hair removal, denture cleaning and pest control. Reckitt Benckiser Group was founded in December 1999 and is headquartered in Slough, the United Kingdom.
What really informed your current visit to Nigeria?
We have been in Nigeria for 50 years plus and in those years, we have created a tremendous history which we are very proud of. We are creating economic opportunities for people we employ directly or indirectly, who are more than one thousand people. We have a factory in Agbara in Ogun State and have significant presence across the country. Within these 50 years, we have created unbelievable and very popular brand like dettol, mortein and harpic. I think this is being a long journey not something that just started with my visit this time nor will it finish in the next 12 months. We are a long time partner in the success of Nigeria, not just from the economic point of view but also from social and health points. I do believe the problem of this country is not going to be solved in pure economic terms; they have to be solved through hygiene. It is a young country and there is a huge opportunity to make this a very strong partnership of growth and prosperity. The visit was therefore geared toward enhancing further this spirit of partnership, to foster greater understanding among all stakeholders.
The company has been in Nigeria for a relatively long time and it must have experienced different different climes in the nation’s socio-economic development. What are the allures that have been making the outfit in keeping faith with the country’s economy?
For me personally, I am from India and when you are in emerging market, the first thing you are guaranteeing is that your trajectory is never going to be a straight line of growth, you will see ups and downs. If you get worried about the downs and therefore stop, there is no point for you to be in the market. A case like Nigeria or India, in the short term growth will be painful. You know the downside of business can be painful but you have to start strong and stand for a long time. Indeed, I must say that there are tremendous opportunities for investment in Nigeria and so, we are here to invest for the long term and not for the short term.
Going into your Nigerian production business, to which extent is your portfolio represented from what is being churned out at Agbara?
Some of the brands like Dettol, Mortein, Harpic and Durex are well represented here but we also know that many brands that are very important to us but are not fully represented here will soon be launched into the market here. Indeed, we are launching some of them very soon.. Very recently, we launched two brands which are known globally but new to Nigerian market.
When you say you are launching in Nigeria, are you going to import the products or you are expanding your production capacity at Agbara to bring about these brands?
We are expanding our production capacity in Agbara in our local manufacturing programme, to make sure that as more new products are in the market here. Some of the products will however be imported, as we need to strategically ensure high standards in local production in our local plant expansion scheme. We need to control the quality and make the products comply with the global standards. The more fragments you are manufacturing, the less control you have over maintaining the utmost quality and with healthcare products, you cannot afford to take chances. So, we are limiting the number of manufactured brands to keep our quality. Therefore, some of those products are always imported whether to Nigeria or other parts of the world.
In your marketing strategy, what is the place of Nigeria within the African region?
Within Africa, it is one of the most important markets without doubt but not just in Africa, when you think about all our emerging markets, Nigeria is one of the most important emerging markets. Though, it is not as big today compared with India or China or Russia, but our ambition for Nigeria is massive. We believe that with the large population of Nigeria, its big young population, the growing middle class and the increasing the need for health and hygiene products, there is no reason why Nigeria won’t become one of the most powerful growth drivers for emerging markets in the future.
So, with the acknowledged bright prospects of the market, what is RB’S investment strategy for the country?
Our investment strategy for Nigeria is multifaceted. We are looking at manufacturing that is fully capable of high quality products; investment in education, especially for young children in schools and we have reached about four million of the children in schools about last few years ago, teaching them about health and hygiene practices; we also reach out to hospitals on how to keep babies and children hygienically clean. So, with education gaining grounds, improving our market and infrastructure; and investing in human capital are what we are working on. Today, I believe that Nigeria may be relatively small in the size of the global market but it is very important to grow that business and how we go about it is also very unique from other companies. We try to take talents from Nigeria to other parts of the world under our exchange programme.
So, how is the company strategically positioning itself for the current socio-political change in the country, especially with the various projections on the economy by various bodies and groups?
First of all, I wish the new government all the luck, because with a new government, you also need good luck. I know that the new government has come with strong mandate of the people, who want to see change, like change for a cleaner government, law and order, security, stronger economic policies and I think the new government has come with that hope. But what I will say is that people should not have short term expectations from the government. It may take a long period of time for some of its initiatives to manifest. The government should be bold, do things that are right for the long term. The oil prices are down, who knows how long it will be and what the next decades hold. But I think it is not sort of bad thing because the present situation could lead to the desired economic security through structural reform that is needed . Sometimes, with low oil prices, government may be forced to do the things that are structurally better that may however not of immediate benefit. So, I think in the adversity of low oil prices, there is also room that government can take tough long term measures, doing the right things because it doesn’t have strong oil price to depend on. Therefore, doing the right thing may just create a much better Nigeria.
There have been various reports by relevant organisations about issues that could compromise good healthy living among the populace. What are the interventions being initiated by RB in this regard?
First, RB has been into healthier life, happy home hygiene and now health hygiene. To push that vision, RB has prioritised hygiene brands like Dettol, Mortein, Durex, among others. We have prioritised them because we believe this has a top purpose. This is very simplistic if you look at some of the most preventable illnesses and diseases in Nigeria. In Africa, you could name malaria, HIV, diarrhoea and all such health issues from poor sanitation. This is one of the biggest issues in Africa in general and Nigeria in particular. Actually, about 85 per cent of preventable illnesses in history are here and we have brands to tackle them. So, we therefore have the responsibility to do something about it and actually, this is what I am here for. Indeed, our messages focus on healthier life, happy homes, as individuals need to live better life for a healthier society. At RB, we have decided that whatever social programme that we initiate should be linked to our strategy. So, this is the reason we are taking a massive social programme called ‘save a child a minute’. This is a programme we run with many stakeholders who recognise the fact that around the world, we lose one child every minute under the age of five due to diarrhoea. That is preventable, so we have dedicated $35 million for this programme for the next seven years. But beyond the money, as I was just saying, we are using our innovation, we are using our product development to bring new products which people can use at very cheap prices to enhance themselves better to make them more hygienic. Right now, we are working in a small town on the outskirts of Lagos called Shomolu, where we are putting this whole programme with our partner under the WHO seven points system and we want to make sure we achieve good results and bring down the rate of diarrhoea. We plan to scale up the programme to other parts of Nigeria to make more tangible difference.
Can you tell us more about the partnerships you’ve evolved under the ‘save a child’ programme in Nigeria?
We have a number of stakeholders in the programme. One is ‘Save the Children’, which is a very established NGO that has offices in many countries across the world and they have established a network of people who can provide life changing experiences and education across the number of points of impact, like schools and hospitals. The second is that we are working with the Ministry of Health, partnering with them to ensure that we can get the government and other stakeholders involved in our efforts. What we want to see more of is if we can get the hygiene curriculum and if we can actually include that in the school curriculum that young children we learn from at a very young age to stay hygienic. Currently, not many Nigerians, according to reports, wash their hands and that might not change in one generation but change may come in the long run as more people wash their hands with soap and water to prevent not just illnesses like diarrhoea but other preventable diseases because there are a lot of preventable diseases that can transmit with the hands.