Entrepreneurship Zone: 12 April 2024 :: How Ghana’s Catherine Krobo Edusei capitalised on demand for high-end fresh produce

Fri Apr 12 09:50:41 CAT 2024

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Entrepreneurship Zone: 12 April  2024 :: How Ghana’s Catherine Krobo Edusei capitalised on demand for high-end fresh produce

 <https://www.zitfevents.com/> 

When Catherine Krobo Edusei first took her freshly grown herbs to the local supermarket in Accra, the manager didn’t know what they were.

Ghana, like many African countries, imports large volumes of food products and the dried, imported variety of herbs were the only kind people knew.

Two decades later, her company is one of the biggest suppliers not just of fresh herbs, but also spices, fruit and vegetables.

Krobo Edusei, the founder and CEO of Eden Tree, started growing herbs when she returned to Accra in 1996 after 14 years living in the UK, where she was a banker. When she left, Krobo Edusei assured her family that she would not return to the formal sector once back home in Ghana, but find work that enabled her to be a hands-on mother for her small children.

“When I came back, I didn’t know what I was going to do. I nearly returned to the formal space, but my family urged me not to and said I should pray on what to do next.”

“Agriculture was not on my radar at all, but I did pray and one thing led to another, which eventually resulted in Eden Tree.”

The first steps

She started on the journey after investigating an opportunity in Ghana to grow the aloe vera plant commercially. It piqued her interest and she asked her sister-in-law in the UK to source some literature on growing the plant.

When the books arrived from London, they didn’t have the details on how to grow aloe vera but they did contain a wealth of information about growing vegetables and herbs. This opened her eyes to a potential niche market in Ghana.

“I realised that I couldn’t find the herbs in Accra that I had cooked with in London, nor could I find locally packaged vegetables. Everything was imported from other countries and was very expensive.”

So she began growing herbs. Krobo Edusei set up the business with her own savings and leased land for the first crops from a family plot, later investing in farmland in various parts of the country. “Funding was an early challenge and it was up to five years before I started paying myself a salary. All the profits were ploughed back into the company.”

One of the farms that supply Eden Tree’s vegetables

She was soon packaging and labelling the herbs in a way that resembled what she had become used to seeing in UK supermarket chains such as Sainsbury’s and Tesco.

The manager at the only supermarket in town in those days, Kwatsons, was surprised when Krobo Edusei brought him a tray of packaged fresh herbs, including dill, fennel, coriander and basil, and asked what they were. He had not seen fresh herbs before, only dried herbs delivered in containers from overseas markets. “He reluctantly said he would display them. If they sold, he would pay me and if not, I should collect them. We shook hands on it,” Krobo Edusei remembers.

By the next day, the stock was sold out, bought by expatriates living in Accra – diplomats, aid workers, businesspeople and others. “They patronised herbs our own local market didn’t know.” The manager was impressed and agreed to regular consignments for the supermarket.

Growing the company

To expand her offering, Krobo Edusei established partnerships with local farmers and her product line started to include vegetables and, later, spices and fruit. The trays quickly became baskets of fresh produce and then crates as demand grew. “We provided alternatives to imports that were not only fresh, but looked good and were price-friendly.”

Eden Tree works with about 100 farmers, providing them with soft loans where necessary to improve production and buy inputs. “We are the bridge between smallholder farmers and the stores. We understand the language of the supermarkets, so we are able to transform their produce into something that is acceptable to the stores.”

The successful partnership between Krobo Edusei and the farmers produced a winning formula for consumers in a formerly neglected market segment. As new supermarkets opened in Accra, so the market for Eden Tree expanded. It set up a factory to add value to the produce and pack it for sale. Over time, staff numbers have grown to 65.

However, training staff was a challenge. Krobo Edusei explains the work ethic and culture in Ghana were different from what she was used to in the UK and it took time to change mindsets and behaviour to align them with her expectations for the business.

The Eden Tree factory

The company now has three main business channels: growing and packaging fresh produce; a convenience foods business that supplies cut vegetables, ready-to-eat salads, crushed garlic and other value-added products; and a fresh fruit juice division, in a new partnership with fruit growers. A fourth channel – home deliveries – is being created on the back of demand arising from the Covid-19 pandemic lockdown.

Cash flow has been a constant challenge. As demand for products grew, so did demand for funding to increase the quantities. “At one point, we were so cash strapped that the reality of folding up was quite high. It was a very difficult time.”

The  <https://www.howwemadeitinafrica.com/category/sectors/banking/> banks were not keen to fund agriculture, seeing the sector as high risk. With a track record, they are now more welcoming, Krobo Edusei says, although long-term lending is still a challenge with banks offering loans for just two to three years.

The business was given a boost in 2015 when private equity firm Investisseurs & Partenaires invested. “They held our hands as partners and helped us to professionalise the business and put the factory up.”

Currently, Eden Tree supplies 12 supermarket chains in Accra. The business is well served by being in the capital and has yet to expand further inland.

Its biggest competition is South African retail chain Shoprite. Normally, it would most likely be a client, but Shoprite has established its Freshmark subsidiary in Ghana, which sources most of the chain’s fresh produce needs directly from local producers, in a model that is similar to Eden Tree’s own.

Looking ahead

The company recently established its own branded store on the outskirts of Accra and has ambitions for a chain of small shops across the city to bring Eden Tree products closer to local consumers in a country where tastes are starting to change. It will also provide a much-needed cash injection into a business that otherwise relies on long payment turnarounds with supermarket clients.

The clientele is no longer just the expatriate community but middle-class Ghanaians who are turning to healthier diets in a country where the traditional local food is carbohydrate heavy.

Eden Tree is part of a new local certification programme, the Ghana Green Label scheme, which aims to give consumers confidence in locally grown fresh foods and, in time, set up participating businesses for export markets.

Exports are not on the cards just yet. “We will monitor the proposed African free trade area and see if it will make it easier to trade across borders in the region. Because we are dealing with perishables, we have to be careful and currently it is really difficult to trade in Africa.”

Being a woman in business in Ghana is not easy. “To run a business in our culture, you need to be very strong as a woman. Fortunately, I have that quality, so I was able to succeed.” She also had to make personal sacrifices to balance the business with being a single mother.

Krobo Edusei says while growth has not been explosive, the pace has been manageable, given capacity constraints. “Growing too fast would have been too stressful for me, trying to manage so many things at the same time.”

Her passion for the business sustained her through the tough times. “I did not know I had that passion in me until I started. I had never bothered with gardening, but it turned out my passion was for growing food; it was a joy to do it. After 23 years, it is still a passion.”

Catherine Krobo Edusei

-HowwemadeitinAfrica

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