Entrepreneurship Zone: 20 November 2024: Exporting Zambia’s honey to the US: Interview with agribusiness entrepreneur

Wed Nov 20 09:22:59 CAT 2024

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Entrepreneurship Zone: 20 November 2024: Exporting Zambia’s honey to the US: Interview with agribusiness entrepreneur

Miit Pandoliker

Interview with Miit Pandoliker
CEO AND CO-FOUNDER, LUANO FOOD COMPANY

Lives in: Lusaka, Zambia

  _____  

Zambia-based Luano Food Company, which specialises in honey and is now diversifying into avocado processing, recently received investment from venture capital firm wCap. We spoke with Miit Pandoliker, co-founder and CEO, about his entry into the honey industry, the company’s growth opportunities, and the challenges of operating in the agribusiness sector. Below are slightly edited excerpts.

1. What were you doing before starting Luano?

Before starting Luano, I owned a logistics company, which is still in operation. I discovered the honey business while transporting fertiliser to remote rural areas in Zambia and saw an opportunity. I grew up between Zambia and the US, where honey is more highly valued.

2. Give us an overview of Luano and your product range.

We recently changed from Luano Honey to Luano Food Company as we have started doing more than just honey. Our product offerings include infused honeys, honey barbecue sauce, chili sauce, chocolate honey spread, and various spices. A unique selling point of our brand is that we don’t own a single farm or beehive and source from Zambian small-scale farmers across the country. We also promote regenerative agroforestry models for our farmers to follow.

3. Tell us about the early days of the company and how you got to where you are.

In the early days, Covid really affected us because we had just bought the company at the beginning of 2019. When I acquired it, the factory was shut down and stored in a container. We moved it to Lusaka, the capital city, and restarted the business. When we first launched, we had only two product lines in retail; now we have 12. As an export-based company, Covid prevented us from travelling and making deals. I only started gaining export revenue two years ago when I first exported to the US.

4. Take us through the journey of establishing the processing plant.

Setting up our processing plant in Zambia was relatively straightforward. When it comes to honey, the less you do with it, the better – the more raw, the better. At our plant, we simply clean the honey, remove excess moisture, and package it for distribution. Our first product was raw honey in a 1-litre plastic jar, and it remains one of our fastest-moving lines.

5. What opportunities do you see in Zambia for avocado growing and processing, and how is Luano tapping into this potential?

The potential for avocado growing and processing in Zambia is very high. There are existing plantations and we plan to support these farmers by becoming their market. It fits well with our agroforestry model, as avocados are an excellent tree crop that is drought-resistant. Our plan is to promote avocado cultivation alongside beehives and intercrop with other crops that support biodiversity, such as shade-grown coffee. We also intend to help these farmers tap into carbon credits for their tree crops like avocado.

Luano Food Company’s honey processing facility

6. How did you secure your first customers?

Our first major retail partner was Shoprite Zambia, and the previous owner of Luano introduced us to the key buyer for re-listing. I also personally visited the major supermarkets around Lusaka to introduce our products.

7. Where are your products sold?

Our products are available at all major retailers, wholesalers, and on e-commerce platforms across Zambia. We recently started selling on Takealot.com in South Africa and plan to expand to retail and Amazon. In the US, we sell in bulk through our warehouse in Baltimore to various ingredient buyers and aim to enter the retail market by the end of the year. We also have immediate expansion plans for the UK and the Middle East in the first quarter of next year.

8. How do you ensure you remain competitive?

We try to keep up with the latest trends in packaging and bio-sustainability. We also make sure the end user gets the best price while ensuring fair compensation for our farmers. Additionally, we focus on innovating our product offerings and developing new products.

9. What challenges do you face in running the business?

Lack of capital for expansion is a major challenge in Zambia, making growth slow and costly. We are also facing a power crisis due to severe drought this year, which has put production on hold. Additionally, being a landlocked country, we incur higher costs for our exports to reach their destinations.

10. Describe some of the major trends you’re seeing in the market.

Value addition with honey is definitely the biggest trend, with its use as an ingredient in wellness FMCG products on the rise. Globally, consumers are increasingly looking for “feel-good” ingredients in their food products.

11. Luano recently received funding from wCap. How do you plan to use the funds?

The funding will be used to acquire our avocado oil processing facility.

—Howwemadeitinafrica

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