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Friday, August 24, 2007

I sold my houses to begin suitcase manufacturing when banks refused me loans


At a time, no one thought it was possible to localize the production of once-upon- a- time imported brief cases in Nigeria, Chief James Uzuh dared and proved skeptics wrong.

Starting off under very stringent operational environment, for the Managing Director of J. Jumac International Company Limited, the journey was not only uncertain, but strewn with bumps.
Like a-never-say-die, Chief Uzuh brazed the challenges and today, boasts the first on the continent to begin the manufacturing of suitcases in this part of the world.

However, he tells anyone who cares to listen that as a manufacturer, if you can make a head way in this part of the world, where candle light has become the surest source of energy, coupled with other infrastructural desiderata, you can break even, even in hell.

According to him, it is only people with large hearts that can go into manufacturing and survive.
He lamented that because of the variable power supply, he spends about N2 million every month on diesel. This is besides the two generators, which cost a whooping N16million to procure.
In this chat with Saturday Sun, he also spoke on the vision he has for his company, what government should do to encourage manufacturers and sundry issues. Excerpts:

Beginning
As a young entrepreneur, I had wanted to be like the Razaq Okoyas and the Dangotes of this world. But I must say that as result of the lack of infrastructure in the country, manufacturing is not for lily livered people.
I was inspired by what they were doing, but when the Federal Government placed a ban on the importation of suitcases, which was one of the major items that I was importing from Europe, I thought that my time had come to be like my heroes. That is like Razaq Okoya-Thomas and Alhaji Aliko Dangote, but I did not know that I was venturing into a murky water without hope of getting out.

I first of all built a factory. After that, I began to go from one bank to the other to source for loans or at worst equity participation, but there was nobody interested in that because they felt that they would not make much money from it. Their interest was on short term loans and import finance. I thought then that as somebody going into manufacturing, that would not do me any good. I resorted to selling my houses. I sold three of my houses and with the capital I raised, I imported machinery for the commencement of production of suitcases. It was at this stage that banks began to come to do business with me, that is after I had built and equipped my factory with all that was needed to go into production.

Challenges
The challenges facing manufacturers in the country is enormous. I can use my personal experience as an example. After I had managed to build and set up a factory, I became broke. So I had to depend on the national grid for power. Because of that I lost a lot of machines due to power surge. Then I decided to go for generators. I spent N16 million on two generators. Now I use about N2 million every month on diesel. If this money is channeled into the company, we will grow faster. After production, it takes more than N200, 000 to transport the finished products to the markets. This is due to poor road network. If it were in countries where the railway system is effective, transporting goods from Lagos to Kaduna cannot take more than N50, 000.

The banks are also not helping matters. I had thought that after the much talked about re-capitalization, banks would make things easier for people who are in the manufacturing industry, but the reverse is still the case. Their focus is on short term loan and import finance. But how can our country develop if it remains an importer of finished products? When I was engaged in importation, I had only five staff, but now as a manufacturer I have more than 150 staff. If my company goes under as a result of unfavourable business environment and these people are thrown into the streets, they might be compelled to engage in vicious means to survive and by that, threaten the security of you and I. What I am saying is not peculiar to me alone, this is the experience of every manufacturer in the country. I am therefore calling on government to create an enabling environment for manufacturers to flourish. They should try to make the power sector functional. They should also address the poor road network being experienced in the country. Banks should reduce interest rate and also begin to encourage manufacturers by giving them long-term loans.

Between made in Nigeria and foreign suitcases
With all honesty, I want to say that suitcases manufactured in Europe for consumption are of very high quality, but the ones produced for export, especially for African markets are of very low quality. This is because they feel that Africans are poor and for that cannot afford quality suitcases. That is the reason why you see people handling imported suitcases, as if they are eggs, because they know that once anything happens to them, they will break.

Days are gone when people had the impression that made in Nigeria products were inferior to that made in Europe or Asia. For instance, there is no doubt that wires made in Nigeria are today the best in the world. Those who felt that Nigerians couldn’t come up with quality products have been put to shame by the wire manufacturing company in Nigeria. In the same vein, J. Jumac suitcases are the best in the world. Anybody who doubts this can go and ask anyone experienced in suitcases. Our products are very rugged. We have been to trade exhibitions in Ghana, Mali Tanzania and other countries where we exhibited our products alongside the ones produced in Europe and they came up tops. So we are no longer babies in the field of manufacturing

VISION
My vision is to make sure that Nigerians are given the best in terms of suitcases. I also want to control over 90 per cent of the suitcase market, not only in Nigeria but the whole of Africa. As I said earlier, we have gone for trade exhibitions to Ghana, Tanzania Mali and other African countries. Our finding was that we were on top of the industry. But the reason we have not begun to export was because we had not got the Standard Organisation of Nigeria (NIS) certificate. And without that, they would doubt the quality of our products.

Now that we have got the certificate, we can now start in earnest to export our products to other countries. So we have plans to also expand our factory, more so that we will become the biggest in Africa. If you go to our factory, you will see a new building that is being constructed.
I feel on top of the world receiving the NIS certificate from the Standards Organisation of Nigeria. It is a testimony that J. Jumac suitcases are of international standard. It is because only companies that their products have met International Standard Organisation specified standard that get the NIS certificate. Therefore, I see the certificate as a surety on our products from SON to the world that J. Jumac products are of international quality and standard
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