Entrepreneurship Zone: 09 September 2024: Selling lemonade in Nigeria through an innovative distribution strategy

Mon Sep 9 08:11:07 CAT 2024

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Entrepreneurship Zone: 09 September 2024: Selling lemonade in Nigeria through an innovative distribution strategy

Seyi Abolaji moved back to Nigeria in 2007 after living and studying in the US. He was eager to join a family member’s palm kernel oil venture but discovered the business was not what he thought it was. Starting from scratch, he ventured into selling hand-squeezed lemonade at a local university. Today, Wilson’s Lemonade is available in three different flavours and stocked in several supermarkets. Jeanette Clark spoke to Abolaji about overcoming logistics challenges and the marketing strategies that worked to build the brand.

Starting from scratch

Growing Wilson’s Lemonade into the company it is today has been a continuous hustle, often under difficult conditions; in the beginning, much to the frustration of Abolaji’s parents. After obtaining his degree at Stanford University, playing professional football and settling into a new job at McMaster-Carr (a supplier of industrial materials and equipment), he announced he was returning to his home country. “It was a big surprise for everybody, it was never really the plan.”

He strived to get the palm kernel business up and running and sustainable. It was largely an empty shell when he arrived. But he machinery did not have the correct specifications and the warehouse in Ota, to the north-west of Lagos, was not constructed properly to run the vibrating equipment to process the oil.

Abolaji was undeterred. He built a wood hut at the facility and used plywood to separate his office from his sleeping quarters; not wanting to leave the building and equipment unsupervised.

“It was a mess but, at the time, I thought I was doing what I had to do to make this work. About a year in, I conceded it would not succeed. I had to start over. By then, I had used all my money but I did have land and a generator,” he says. It was a start.

He went to the nearby Covenant University campus kiosk and convinced them to allow him to sell hand-squeezed orange juice in cups. Over time, he added smoothies and, eventually, lemonade.

In 2010, they changed from cups to bottles. Abolaji and his brother Seun (who had since joined the business) would scrounge for used plastic bottles, sanitising these and filling them for sale. Swapping from orange juice (which everyone was doing) to lemonade was a differentiator. Along with the move to bottling, it planted the seed that the product could grow into a brand.

The business expanded incrementally. The brothers registered the company in 2010 and in October 2012, Wilson’s Juice Company received National Agency for Food and Drug Administration (NAFDAC) approval for its lemonade product. The scene was set. Abolaji thought sales would skyrocket.

A great product is only great if people know about it

“This is where I learnt there is value in marketing,” muses Abolaji. “I thought the NAFDAC accreditation would have people hammering at the gates … nobody hammered.”

The brothers decided to get the brand name out there. They went to events and parties, claiming space to sell their product. “We convinced the organisers the lemonade was a great mixer and they would agree to let us stay, as long as we didn’t bother anyone.”

Slowly, the Wilson’s brand gained attention and some shops began stocking the product. However, the bigger chain stores were much harder to crack. “Shoprite took us a year and a half; 18 months of checking in two to three times a month, swallowing humble pie and hearing how bad our product looks and how we should change everything,” he remembers.

Once on the shelves, marketing and branding became crucial to get it into shopping carts. “Our product is more expensive because of the natural ingredients, but also because of the look and feel of the bottle: square with a full label. Yet, we were adamant about not changing that because we wanted to be different,” says Abolaji.

The company realised it would have to segment the market and focus on customers who are less price sensitive. “Our market is a very specific person in Nigeria; we had to find and target the people who would ask about the natural ingredients first and price last.”

Importantly, the company did not focus on traditional advertising. It found and used niche and up-and-coming influencers through an ambassador programme; followers and fans were asked to engage, to choose who they thought would be a good Wilson’s ambassador.

“Instead of the guys with 5,000 to 100,000 followers, we built relationships of mutual respect with rising stars with 500 to 2,000 followers. We asked if they were cool and bold enough to be different and if they had a certain amount of swag.”

Overcoming distribution challenges

Initially, Wilson’s thought it could do its own logistics and distribution to save costs. “We wasted money for around four to five years,” reveals Abolaji. The company struggled with unreliable drivers, and vehicle breakdowns impacted delivery. They tried to find distributors but this also failed.

“The distributors kept returning with unsold products, saying their clients weren’t interested. We asked them to put in extra effort to tell our brand stories to the customers, but they did not want to.”

“Formal logistics companies were only willing to take us on if they could do 100 cartons to 10 stores and call it a day. Our product is more like three cartons to 100 stores.”

The solution came two and a half years ago in the form of what the company calls its “logistics partners”; people who recently lost or are in between jobs and need some income. Wilson’s delivers in bulk to a few places in Lagos where these partners collect the product for last-mile deliveries in their area.

“We have incentives to keep them to a 48-hour turnaround time and disincentives if they hit below 85% of their deliveries,” says Abolaji. “We make it worth their while to work for us five to six days a week and they are earning more money now than they have before.”

The company hopes to grow this model further, adding up to 10 times the partners it already has.

Growth and diversification

The company recently launched a low-sugar, low-cost lemonade (one bottle sells for 100 naira, or US$0.24) under the name, Fifun Todos. It is a combination of the word fifu (to give) and todos (for us).

“We are saying: this is for all of us. Wilson’s is a little more exclusive and premium, whereas Fifun Todos is for everybody.” They hope to dominate the lemonade market to such an extent that other brands are unsuccessful in divorcing the drink from the brand name.

“La Casera had a fizzy apple drink. A year or two later, Fanta Apple was introduced but everyone called it Coke’s La Casera. We want the same … we want to own lemonade in Nigeria,” he says.

Wilson’s Juice Company has a few more products in the pipeline in terms of teas and flavoured waters. “However, we believe in focus. So, before we get ahead of ourselves, we want to grow our footprint beyond Lagos. This year we must decide on organic or aggressive growth.”

—Howwemadeitinafrica

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