Interview with MAN News Nigeria: “Review your strategy frequently so you are not stale.” – Dr. Toni Ogunbor

Dr. Toni Ogunbor is an accomplished entrepreneur and one of Nigeria’s foremost Industrialist. He is the Chairman /Chief Executive Officer of one of Nation’s biggest conglomerates, NOSAK Group, a company that is involved in series of economic activities and a major contributor to the growth of Nigeria’s economy.  Recently, Manufacturers Association of Nigeria NEWS (MANNEWS) team caught up with him and he opened up on his success story as well as challenges in the business world, excerpts:

As one of Nigeria’s foremost industrialist, chairing a very large conglomerate as Nosak Group, achieving this feat no doubt couldn’t have been an easy sail, do you mind taking us through your journey so far?

Thank you very much, I am pleased to hear you say we are a foremost industrialist and a very diversified one at that.  It has been a long road to travel. This business started over 35years ago. After my educational programme- first and second degree, I ended up working in Kano with a company called Union Carbide but along the line certain things happened that made me quit the job and so I started business as a retail food seller.  I took a shop, had suppliers bring fish and meat, got a fridge from Coca-Cola to sell cold drinks. And so, while doing that, we always asked ourselves what is the next level and what new opportunities are available? Looking back, we thank God that we have been able to apply the wisdom, the tenacity and the aggressiveness to take advantage of opportunities to put together our diversified group of businesses.

Dr. Toni Ogunbor, Chairman, Nosak Group
Dr. Toni Ogunbor, Chairman, Nosak Group


NOSAK Group is involved in healthcare, haulage, supermarket, farms, distilleries, oils & fats, financial services and lubricants, which are clearly distinct lines of businesses. What nudged you into venturing in these sectors?

You know once you find yourself in an economy and you do the analysis of what opportunities offer themselves, then that will drive you into the kind of business you ought to do. In Nigeria, you will agree with me that certain sectors are unpredictable and when you look at the challenges in the economy you will know that you need to be diversified to achieve stability. Sometimes a sector of the economy might not be doing well and so you want to have an interest in other sectors so when one is going through difficulties, the others can keep you going. However, we are also very careful in going into sectors in which we operate.

You will very well know that government policies are unpredictable and if you don’t get diversified, one government policy can paralyze your business. These are the reasons why we felt we should be diversified.

I will share an instance with you; there was a time when our subsidiary, the ethanol plant had a fire incident and for six months we were not producing but nobody was laid off because other subsidiaries were able to sustain the business. In a nutshell, there is benefit in diversification.

How we operate is that we get into a sector and build it into a sustainable level; then when we get wind of other opportunities that are arising in other sectors, we then explore the opportunity of investing in that sector if we foresee high growth potential.  In the same way we move into new areas, we have also been known to quit certain sectors. We were into industrial block ice making and it got to a point we felt that we have outgrown that kind of business and we had to sell it to move on to other sectors with promising growth potential. Even today, with our many subsidiaries, nothing stops us from revaluating our businesses by selling off some more and investing in other lucrative ventures.

In NOSAK, we are very deliberate, we don’t claim to know it all and so when it comes to moving into a new sector, we scout for people who are knowledgeable in that industry and bring them on board to work with us. Let me state for example our haulage services, I cannot claim any technical expertise in the field. I am only taking advantage of my administrative and managerial skill to champion this business line and many others that we are into.

It is important that you identify the sector that you are passionate about getting into, draw a line as to the extent you want to go and put together a team of people that can guide you as to how best to get into the business. This, in a nutshell, is how we have been able to approach our line of businesses.  I must also add that some of the subsidiaries we have now came because we were compelled to go into it. For our haulage business, this came into being because we needed to have exclusive dedicated vehicles to move our ethanol products. Ethanol as a sensitive product needs to be moved by dedicated tankers. Initially we wanted to use commercial tankers but we realized it was not possible and so we had to invest in the logistics sector which is what gave rise to NOSAK Haulage Services Limited which not only serve us but other third-party businesses.

What factors can you attribute to your success story as a businessman?

The environment in which we operate in Nigeria offers a lot of challenges and so you have to be very determined.  Like I tell many people, not every person is cut out to be a businessman or an entrepreneur because entrepreneurship is not a science, it is an art. If it were a science anybody can add one plus one to make two, but entrepreneurship is not like that. One must have the innate characteristics of an entrepreneur; you have got to take risks, be dynamic, determined, have passion and vision. It is also important to be able to identify and quantify the risk involved in any business enterprise you want to bring into reality. In addition to these attributes, you have got to know how to manage resources. Not every person is a good manager of resources.  When I talk of resources, I am referring to both human and financial resources which are very key to the growth of any business.

Kindly share your experience of doing business in Nigeria and how have you been able to overcome the challenges that come your way?

The Nigerian environment of doing business I must say is an interesting one. We started as traders and so the challenges involved in manufacturing often make me ask myself why I didn’t remain a trader but the self-actualization and satisfaction you have in manufacturing is different from trading. In manufacturing you employ people and so you get to add value to their lives engaging them to create. As an entrepreneur, there is also a level of satisfaction you enjoy in manufacturing.

However, given the Nigerian environment, if you are not determined to succeed it would be very easy to give up. When you look at the horizon in the manufacturing sector, you will find out that the survival rate of most manufacturing businesses is very low. If you take your mind back to like 10 years ago, you would observe that there are many Nigerian manufacturers that were in business then that we do not hear of today. Even though we have been around for over 30 years, it is because we believed in ourselves. We had a can-do spirit and we believed in the future of the country. Rather than give up, we always find a way to overcome the obstacle.

Looking back, have we been able to achieve that satisfaction? I will say yes despite the challenges not because we have grown in size but because we are responsible for over 1000 people in our employment both direct and indirect. Have we been given the deserved recognition by society? Honestly, I do not know but we draw satisfaction from seeing the people that we employ. Otherwise, like I mentioned earlier, it can be very frustrating and not too many Nigerian manufacturers have been able to survive in the past 30 years.

Let me give you this typical example, during the Nigerian financial crisis of 2008 – 2009, you will remember that the then CBN Governor, Prof Charles Chukwuma Soludo devalued the naira. It was so shocking to most of us who developed good relationship with our suppliers of raw materials who were giving us deferred payment for at least 90 days and suddenly there was a devaluation. We felt that the government was very irresponsible by allowing the devaluation to take place without addressing the exposure of Nigerian businesses to the FX risk. Many businesses went down and never came up. We went through that experience and we are just getting out of it. As a result we lost 10 years, which should have ordinarily been productive if the Government took into consideration the interest of Nigerian businesses that were exposed.

Additionally, it is important to state that not every AMCON debtor is a criminal. Their inability to pay their debt may be as a result of government policy at the time, which made it impossible for them to pay their debt as at when due. Businessmen who had built business relationship with their clients over the years suddenly became bad customers. In my case, I took a decision to go into manufacturing without having a plan B to give up and so what has helped me is the strategy to always be prepared and plan before any unpalatable situation comes up.

I must also tell you that once you have tasted manufacturing, the tendency is usually there for you to move on regardless of the situation. The issue is just the challenging economic environment in Nigeria.

We in NOSAK Group have had the need to put away a line of business because of power issue. We were in plastics and you know when power goes off in the line of production, the process gets interrupted and leads to a huge waste and so doing business without not only uninterrupted power, but cheap source of energy could pose a lot of challenge.

In a bid to overcome the power challenge, a lot of investment has gone into creating alternative sources of energy like gas and diesel generators for us to stay in business. We appreciate what MAN is doing on the issue of power, but we believe there is more that could be done on the issue which should be put in the front burner for Government to intervene. Once this is done, the money being invested by manufacturers in generators can help create more capacity for manufacturing and then create employment and more tax for government.

The bottom line for us at NOSAK is that we do not allow the myriads of challenges of doing business in Nigeria to weigh us down. All we try to do is improvise when the situation gets rough and move on.

Gaining access to needed raw materials appears to be a major threat to the existence of your farm plant, in a bid to stay in business, what immediate intervention would you require from Government?

A country like ours needs to identify areas where we have competency and comparative advantage.  The refinery we have does not have enough raw materials coming from the local sources. There must be an organized approach so that government can provide the needed resources to enable manufacturers build the capacity to produce raw materials locally.  Some of these projects don’t come cheap and that is why funding is very important. For our own peculiar industry where we have to generate the red palm oil as our raw materials, we require a lot of land. Getting enough land from the communities has been quite challenging. Moreover, not every land can sustain that line of business, it can only be rain forest. It is not only that government should provide the funding, but they should also support investors in acquiring the land so there would not be friction with communities. And once these are put in place and giving a 30-year plan, it would be easy at a point to say you will not import raw materials. But so long as a local alternative has not been provided, the Central Bank of Nigeria and the government should make it easier for people to bring in these raw materials. We have acquired over 16,500 hectares in Edo State but the resources to do the development is not cheap. And therefore, Government as a matter of deliberate policy should provide the needed support for manufacturers to succeed.

Recently, the President of the Manufacturers Association of Nigeria, Dr Frank Jacobs paid a working visit to your Farm plant in Apapa Lagos, how impactful would you say this visit was?

We were pleased when he visited as he took time to listen to our challenges and I am aware that he is making effort to engage relevant authorities. Sometimes it takes a while to get results, but we are aware of the work being done and we hope that efforts will yield successful results. We are among the few Nigerian businesses operating in the palm oil production sector which is why the President commended us when he visited. We are quite glad that he has identified with our challenges and working to help us solve them.

How has your membership of MAN impacted on your business?

To a large extent, we have been able to use the forum to bring up our problems. However, with the dynamic President we have now, I believe that the executives of the Association should interact more with members, identify their problems and see how they can engage more with government to address challenges manufacturers face. MAN executives should be able to engage government for certain things to be done particularly before the budget are put together as once the budget is released it becomes too late.

For instance, engaging with the Ministry of Finance, Central bank of Nigeria, Ministry of Industry, Trade and Investments on policies that we think will be in the best interest of manufacturers will enable the relevant MDAs to incorporated them to whatever the Ministries or MDA’s are putting together so that it can be part of the policy statement the government will make.

How would you rate the performance of the present government administration on the ease of doing business in Nigeria?

Well we can see improvement in some areas but there are so many factors that needs to be taken into consideration when it comes to ease of doing business. You got to deal with the low hanging fruits. If you are talking of ten factors, it is important to start with the easier one to deal with and move on to the more difficult ones to handle. If you keep taking it one at a time and not lumping too many things together, I think we can better move up in the rating. However, from the comments we read from international bodies some progress is being made but I believe more should done in a shorter period.

If the authorities tackle the issue aggressively enough, we should be able to achieve more milestones. There is no reason why every six months we shouldn’t be moving up from one level to another but like I said, government should do one thing at a time.

Drawing from your experience as a successful industrialist, what solutions would you proffer to Nigeria’s economic problems?

Hmmm. This is a loaded one. Government should come up with more policies that will encourage industrialists through bearable interest rates because an industrialist cannot obviously survive with 25%, 26% or 28% interest rate. It is just not possible, and this is the more reason why some manufacturers who get started by taking such high interest loan facility cannot sustain their businesses for too long.  Low single digit interest rate should be appropriate and as such government should do more of interventions like the BOI, which offers single digits. More of such institutions should be put in place to provide cheap funds to support manufacturers.

The areas of security, power, road network, railway system is also very important. Off course, multiple taxation should also be eliminated as this does not encourage industrialists in any way. Something urgent should also be done about too many government agencies at the ports creating bottlenecks for manufacturers who simply want to clear their goods. In the ports of some countries, though they clear more goods than us but the process is very seamless with less human activities unlike what is obtainable in Nigeria with too many agencies creating more problems than solutions at the ports.

What is your parting shot specifically to intending entrepreneurs as we roundoff this interview?

Well, if you have made up your mind on what business to go into I would advise that you believe in yourself, be determined. Sometimes when we talk to younger people these days, they will say things are not as easy as it used to be. But I will say there is no best time. Look for opportunities, once you can identify a product or service that is needed. You meet the need and then you will be able to achieve success in your line of business just like big successful businesses of today like Apple, Microsoft and Dangote. Dangote saw that cement was needed and went into cement. He didn’t become this massive in one day. He went into business, he believed in it and he was gradually building. You have got to give your business time to grow. You can’t start today and be number one tomorrow. Once you determine the area you want to delve into, believe in yourself and be committed to your line of business because you must have done the necessary ground work to convince yourself that the area you chose is what you are passionate about. Look at strategies periodically and forge ahead. It might take others five years to get there or in your case it might take 10 years, but it doesn’t mean you have failed. Sometimes the man who succeeded in five years could even crash while you are 10 years operating in full capacity.  Patience, commitment, focus, dedication, dynamism all put together makes you successful.

You will always have challenges, but patience is very key. If you want to succeed as an entrepreneur in this dispensation you ought to be patient and believe in your capability to do exploit.

Final words from you sir?

We appreciate what MAN is doing and we believe they can still do more. This country belongs to all of us. The Manufacturing sector can take the country away from its current challenges that we are in and there is no reason why Nigeria can’t go into full export. Well, we read the story of China, in 25years, they achieved a multi-growth of their GDP and so it is important to draw lessons from them.  We appreciate what MAN is doing and we believe they can still do more. We will always give the Association our support as member.

Let me also use this opportunity to thank MAN President for coming with his delegation to visit our factory and listening to our challenges. We are indeed very grateful.