[Startup Interview] Uju Ojinnaka, CEO, Traders of Africa, Nigeria
As globalization increasingly opens borders of trade for Africa, Traders of Africa, a Nigerian startup is offering the continent’s farmers and traders an opportunity to tap into this goldmine through an online marketplace that showcases products grown, produced or manufactured in Africa only.
The company currently operates in15 African countries, with a network of over 16,000 farmers and traders who have set up a store on its platform. Uju Ojinnaka, the CEO and founder spoke to Africa Business Communities.
Introduce Traders of Africa and your role in it?
Traders of Africa is Traders of Africa (ToFA) is a team of young dynamic innovators sowing the seeds of qualitative trade out of Africa with a mission to create sustainable wealth for individuals, communities, organizations, and nation-states in Africa. We call ourselves, Team Awesome.
The team created a Pan African online marketplace for products grown, produced or manufactured in Africa ONLY - www.tradersofafrica.com. TOFA is strictly a point of convergence as we do not keep any stock.
However, though we have created visibility and access to African products and the platform have escrow from Ecobank Transnational Plc, we realised that trade still does not occur because of these 2 key issues: Trust and payment terms.
Trust: Though buyers and sellers meet on the platform and discuss We saw a great distrust between buyers and sellers; none was willing to make the first move after agreeing on pricing.
Payment terms: The TOFA platform is a B2B platform hence volumes are high. While most buyers desire to pay via such payment terms like LCs, DPs, CADs, most African sellers just want to be paid in cash… “Cash and Carry”
The team created two solutions:
Source Pro Unit: Through this unit, we became buyers to sellers and sellers to buyers still without keeping content and have amassed a web of field agents called – TOFA FIELD AGENTS, who monitor and supervise all orders to ensure that they are according to buyer’s specifications We accept various payment terms from buyers like LCs etc while suppliers are paid in their local currencies.
African Trade Invest: ATI – www.africantradeinvest.com - is a pan African digital platform for funding and investing in African trade. On one hand, genuine suppliers of African products with a confirmed order backed by an acceptable payment term can access funding for their orders. These orders are called Projects.
These project’s funding requests are delineated into units and offered to individuals, groups, companies all over the world to invest in and earn a Share Of the Profit (SOP)
Currently, investments are in Nigerian Naira (NGN) or United States Dollars (USD)
We plan to accept investments in various local African currencies within the next 12 months.
I am the founder and CEO of Traders of Africa - TOFA. I conceptualized the project and with the help of my Team Awesome we have created something unprecedented.
I am also the chief strategist, networker and saddled with the responsibility of connecting strategic partners for our company.
Why was it formed and to what extent has it achieved its purpose?
In 2016, I needed a broadening of mindset to better tackle the challenges we were facing in our family business as we try to scale hence I enrolled for the CEIBS’s GEMBA Program.
In Nigeria at that time, the government placed foreign exchange controls so as to prevent the collapse of our Naira.
Our family business being import-dependent had bills to settle in China and we were in need of USD. I was also seeking for a Chinese company importing from Nigeria – The idea was that we could settle their Nigerian bills while they settle ours in China.
In my search, one of my cohorts in CEIBS introduced me to a Ghanian Agropreneur, who was looking for an agro-commodities supplier in Nigeria because she had a customer that required 20 containers of groundnuts.
I was elated, sent samples, buyer approved and asked that I assemble the products to a warehouse in Lagos and they would pay cash after inspection at the warehouse.
Groundnut is grown in the Northern part of Nigeria, therefore, I asked one of my cohorts who is from the North to work with me on the order.
We looked for suppliers who had that quantity of groundnut at the price the buyer was willing to pay, searched online, asked around but found no-one. Though we found a few sellers on Alibaba platform, their details were incorrect or stale. We even tried buying from Benin but the pricing was high when we added the logistics cost.
I became quite frustrated and saw my dream of getting USD and some profit go into thin air. Even when the buyer reduced the quantity to 1 container, I was still unable to get a supplier. The only option was to start aggregating from different small farms/markets.
I found it difficult to believe that there is no website where I can easily see various African products and get linked to genuine suppliers. I was quite worried that if I, a Nigerian, living in Nigeria could not find a large quantity of groundnut to buy, how would buyers from the world over find and access these suppliers/products? I am determined to bridge this gap, not just in Nigeria but in Africa by creating visibility and access for African products and ensuring that trade occurs.
Presently we have solved the following issues that hinder trade with Africa:
- Visibility of products
- Access to available products
- Payment terms
- Trust - We continually build our credibility
TOFA is evolving, our business terrain is new in our continent though a few people have ventured into some parts but no-one gives a holistic approach to trade (Offline/online).
As an e-commerce platform helping smallholder farmers and traders in Africa sell to international markets what would you say have been the emerging issues and trends in the recent past?
In recent years, investment and trade have changed significantly in Africa. Agriculture and food systems have already changed significantly, globalization has opened the borders of trade for Africa. This means anyone from anywhere can make purchases from anywhere in Africa. Information and technology have boosted growth and reduced poverty globally, our mission is to see smallholder farmers tap into this growth and create sustainable wealth for their families.
With the African Free Trade Continental Agreement in motion #AfCFTA, I expect to see smoother intra-Africa trade deals within African countries.
The above notwithstanding; we still need to onboard more suppliers on the platform; our mission is to have access to at least 2,000,000 traders by the year 2024.
How big is your reach?
ToFA is a pan-African company, we built our mission with the intention of reaching the breadth and scope of the African continent. Presently, we are actively operating in 15 African countries, with a network of over 16,000 farmers and traders who have set up a store on our platform.
We are continuously seeking and creating partnerships in various African countries in other to strengthen our operations.
What is Traders of Africa bringing to online trading that isn’t present at the moment?
We’d like to think that we are for Africa, what Alibaba is to china.
Our unique authentication system makes it easy for buyers to quickly spot and work with verified suppliers.
Through the SourcePro, our offline sourcing unit, we do the background work for buyers who might not find the time to engage directly with suppliers on the platform.
The following are some of our competitive advantage:
We are a Marketplace for only products grown, produced or manufactured in Africa
We are Pan African – no country restriction hence a wider reach.
TOFA field agents – To supervise, monitor and ensure that orders are met according to specifications in a timely manner.
Access to funds – We assist genuine suppliers of various African products with a confirmed order backed by acceptable payment terms to fulfil their orders and earn a profit.
People from all over the world can partake in African trade by investing in an African trade in a reliable environment and earn a good Share Of Profit (SOP)
What is your contribution to the growth of e-commerce?
Ecommerce is taking shape in Africa, and we are proud to be a part of this revolution, especially in Agro commodities. African e-commerce market is projected to soar to $50 billion, the future of ecommerce in Africa has a potential for remarkable and long-lasting growth.
There is a learning curve which must be crossed before Africanc will fully embrace Ecommerce in entirety. We are committed to being frontliners in facilitating trade with and amongst Africa through technology by building trust between buyers, sellers and investors to ensure each stakeholders interest is protected, trade occurs and wealth is created for all.
What do you consider the biggest threat to your business?
Our biggest challenge is not tangible. it is the barrier in the minds of people. the lack of credibility between both parties - buyers and sellers. We continue to work on systems that make it easy for trust to be built over our platform. Like we always say, what we sell in TOFA is integrity.
Secondly, negotiating payment terms causes friction in trade especially if both parties do not agree on a payment term. Other trade obstacles include sanitary and phytosanitary rules further limits smooth facilitation of goods.
Other threats may be government policies/bans that erupt in various countries and access to funding in some cases.
What kind of collaborations do you expect and need for Traders of Africa to succeed?
In 2019, I spoke with Fatima Alimohamed C.E.O of African Brand Warrior for African Fintech Startups at the Africa Netpreneurs Prize on the importance of collaboration between African businesses. The impact of partnership in Intra-African businesses is the secret for exponential growth in Africa, we know this, and we are building our scope by expanding to other African nations through merging/partnering with businesses with a similar vision with us which is- creating sustainable wealth for African traders.
Where do you want to take your business in 2020 and beyond?
2020 is a year of giant strides for us; we seek to reach mind-blowing financial projections.
- We are expanding to other African Nations and currencies.
- Building strategic partnerships to deepen our operations.
- We will continue to build our 3fold credibility with buyers, suppliers and investors.
What is the latest news from Traders of Africa?
Well, that’s a big one. Should we reveal the big secret. ToFA is creating an online construction depot… watch this space.
Africa Business Communities is conducting a series of interviews with startup businesses in Africa.
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