Reaping from value addition

Florence Okot is originally a Langi from Lira District but because she married an Acholi from Gulu, she now considers herself an Acholi. Acholi and Langi both belong to the Luo ethnic group.

Their diet consists mostly of grains such as millet, cow peas, sim sim, groundnuts and tubers such as sweet potatoes and cassava. When Okot’s husband secured a scholarship to go and study dermatology in Tanzania, worries set in because she had no idea how consistent the cash flow to sustain the family would be.

Hard work
However, she remembered that while growing up, her parents taught them the value of working hard. They were taught how to dig and sell agricultural produce. When her husband set off, Okot sat back and tried to figure out what life would look like in the unfortunate event that her husband passed away.

The picture in her mind was worsened by the fact that she gave birth to a child with an abnormality which was too costly to treat in hospital and she kept pondering that had her husband been around, the situation would have been different.

This situation encouraged her to go to the village and face the hard life head-on. “I said to myself, I know this millet. I grew up digging it, I grew it I weeded it and I have harvested it before so I know all the processes,” she says.

She narrates that she approached her mother and expressed the idea to start processing the millet into flour. Her first consignment in 1997, was millet worth Shs 70,000 which she cleaned with her mother and transported it to Kampala. She recalls that she prepared it and took it to Star Super Market on Kampala Road and it fetched a few packets in Kaveera which she also kept selling in Kamwokya and her customers kept giving her feedback on the packaging including its design and type of packaging.

Venturing out
Slowly, she started venturing into cassava which she would get right from the village. She would buy it then wash it when it was still raw after which she would dry it. She explains that the whole process of preparing the cassava begins with washing it as soon as it brought from the garden, then she chips and dries it and again subjects it to another washing before grinding to achieve the white colour.

However, before grinding the cassava, it has to be roasted to remove air and moisture which tends to form blocks in the cassava flour when it is ground.
With the initial capital of Shs.70,000, today Okot’s market has expanded to Shoprite, Uchumi, Entebbe and Mukono. Her only worry is the inconsistent monthly income which has been distorted by the consistent problem of credit occasioned by the supermarkets because they operate on credit. She says much as her monthly revenue fluctuates between Shs 50 million and Shs 70 million, the problem with some super markets is that they sign contracts which they do not honour.

“We have agreements with some of them that they pay us after one month. You find some of them paying you after three months while others the payments keep overlapping each other,” she said. She explains that the credit arrangement was arrived at because the supermarkets claim to have many suppliers they cannot serve on cash terms.

In the processes, she has also ended getting suppliers who supply her on credit and she pays them when she gets the cash because with the Uganda of today, no business can claim to survive on cash terms. “I have products like honey which i get on credit and pay the money into the bank account of the supplier. The most important thing is to pay the suppliers,” she says.

Mrs Okot today employs two permanent employees plus her children during holidays because she wants them to know where the money comes from rather than all the time begging for money.
“I would like them to know where the money comes from and how the business operates so that when I am not there in future, they should keep the business running instead of me dying with the business,” she explains.

Mrs Okot has two children and four dependents she has sent to good schools and also managed to build a house in Namugongo through the business. The business has also stabilised the family. Overall, there is financial stability in the family and she has educated siblings who are also doing well.

She adds that there is opportunity to borrow money and grow and provided one develops networks. She observes that suppliers who give stock on credit become the bosses and she has learnt to work with people. Today, Okot has bought land in Gayaza where she wants to build her own factory. She says dfcu Bank has promised to help her with asset financing so as to acquire better equipment and put up a big store to stock the grain to stop it from rotting.
Currently, her company is worth Shs.200 million. She owns two delivery vans, pickups and a small car for moving around. She also runs a joint grinding mill but her plan is to venture into cleaning grains and processing them.

Her biggest challenge has been finding the market because of the way people especially those in supermarkets despise the products because they think they are of inferior quality. She intimates that such attitude has taught her to be humble all the time. The other challenge like mentioned earlier, is that of selling the goods on credit because sometimes, vermin especially rats which are common in supermarkets, enter the food because of bad storage making the food to rot. Sometimes, it is water which splashes on the food when the shelves are being cleaned and this causes damages which she has to foot. This discourages her quite a lot because at the end of the day, Okot finds she has nomoney because rats have damaged the goods.

The other bottleneck she faces is the recently introduced Value Added Tax on agricultural products because it now calls for all her suppliers to have VAT tax Invoices which when she tries to raise the prices, supermarkets claim will be too high yet when she explains to them, they tell her to leave their supplies for other people who will go and buy them.
“I have learnt lessons and I have also got friends, I have had opportunity to share and I have learnt that there are people who genuinely aise you to build you and let you grow,” she says.

SOURCE: Daily Monitor

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