Fast Food Industry Needs Healthy Competition to Grow

The important role that the fast food industry is playing in the Nigerian economy is significant and cannot be trivialised. Presently, the industry contributes about ₦200 billion, annually, to the economy and employs over 500,000 workers at the processing and retailing levels, in addition to paying over ₦1 billion to the various tiers of government in taxes and levies.

Recently, the Association of Fast Food and Confectioners of Nigeria (AFFCON), which is the umbrella body of quick service restaurants in Nigeria, held its Inaugural Annual National Conference, in Lagos, to further champion its cause in playing more economical roles, nationally and globally.

Bose Ayeni, the President of AFFCON, who is also the Managing Director of Tantalizers Plc, a leading fast food company in Nigeria, spoke to FinIntell about the vision of the association and its challenges.

Why was AFFCON established?
AFFCON is a non- governmental, non-partisan and non-profit making organisation. It was set up to promote, safeguard and protect the interest of its members as well as to ensure self-regulation, achieve and maintain international standards in the fast foods, confectionery and allied industry in Nigeria.

AFFCON was conceptualised by a group of four members. Today, it has more than 150 registered members across the Federation, with chapters in Rivers State, Cross River State as well as the Federal Capital Territory, Abuja.

The need to have a body that would liaise with government agencies, unite, regulate and promote the activities of the fast food brands and confectioners gave rise to the formation of AFFCON on July 21, 2004 when the formal inaugural meeting was held.  The Association was registered by the Corporate and Affairs Commission on February 19, 2007.

What necessitated the need for an annual national conference?
In the past, we usually have some social interaction sections, annually. But since AFFCON is growing, we felt it was time to call a formal annual conference and use the platform to invite the regulatory bodies and some experts to share information with us. By this, we can increase the knowledge base of our members.

The annual conference is also essential because the landscape of the industry is changing. We now have more international brands coming in to the Nigerian industry. So, we need to start learning what it will take to move our local brands to the level where it can compete without any difficulty. That is why the shift in AFFCON now is moving more towards knowledge improvement.

With about ₦200 billion being made in the fast food industry, in terms of revenue, and about half a million people employed, there is a need for the government to start looking at the sector as a serious business.

What is your assessment of the different policies that government is introducing in the agricultural sector?
There are some efforts that the government is taking to improve the agricultural sector. But the truth of the matter is that, we want government to involve the stakeholders before policies are made so that our input can also be factored in.

Sometimes government make policies without carefully considering the decision making process. And what that means is that, they are not taking into consideration the ripple effect of those policies. If they talk to all the stakeholders, we may still come to the same conclusion, but with different inputs. This is why we need to get AFFCON to the level where government can also talk to us before policies are made.

Is AFFCON making any effort to sponsor bills that will favour the industry?
A good suggestion is what you have just brought up. We have always talked around it and we believe that when we project ourselves better, it will be easier for us to sponsor bills at the national assembly.

Getting financial support is one of the challenges entrepreneurs face. What has been your own experience?
I believe my experience should be similar to the other members of AFFCON. Getting access to capital is very costly and it is difficult. Even when you get it, you eventually find out that you are working for the bank. When you look at all the other challenges facing the business, you will discover that what the bank is getting out of that business is higher than what you get for operating the business.

What do you think should be the way out?
For me, the way out is for the government to look at long term loans that will enable us pay over a longer period of time. It is necessary for government to also ensure that the interest rate is not high. One can only do little business with high interest rate and be profitable.

The other solution to look at, as an organisation, is how we can access the equity market. Equity financing is a good option. However, not all of us are positioned to do that.

As competitors in the fast food business, do your members share information with each other?
Whatever information we don’t regard as corporate secrets, we share it amongst ourselves. And apart from information, we share knowledge and contacts with each other. This is actually the essence of AFFCON.

We have a healthy competition amongst ourselves and give moral support to one another in terms of individual or corporate challenges. We are a law abiding association, poised to promote the hospitality and tourism industry in Nigeria.

Food business in Nigeria is dominated by women. What is AFFON doing to woo some men who have funds to invest?
Interestingly, when you look at AFFCON, it is dominated by women. But we have some strong men amongst us. I don’t know why the industry is dominated by women. But I think it is because a typical African man looks at everything that has to do with food as kitchen matter. And you know kitchen is seen as the preserve of the women.

AFFCON always encourage men to come into the industry. We also expect that men who don’t have interest in fast food business, can encourage and finance their wives to venture into the business. By the time the business grows, the men will see that the industry has huge potential than what women only can handle.