In the village then, I would go in search of palm kernels and palm nuts, and sell them at the market. My parents, I told you, were not rich.
Henry Akubuiro
Okafor Ejike Echesiogu is a self-made, young entrepreneur with a reach across the length and breadth of Nigeria. But the journey to success wasn’t like a stroll in the park for the Group Chairman of Gold Group of Companies, Abuja. As a little boy, he hawked palm kernels and palm nuts in the village to raise money for his school fees, because his parents were too poor to train him. Later, as an undergraduate at the Bayero University, Kano, he and his late brother, Osita, hit on an idea to produce foams and bridge the gap of traders and buyers travelling all the way to Onitsha to purchase the product, but there was no capital. He decided to work for a foam manufacturer without pay while still an undergraduate. Years later, he hit the ground running, producing Gold Foam, which recently marked its 25 years in business. Today, he sits atop a business chain that is not only into foam making but also into the hospitality industry, real estate, agriculture, and furniture making. Saturday Sun caught up with him recently visit in Lagos to share his amazing,breakthrough story.
READ ALSO: Organic farming advocates task Nigerians on good health, hospitality business
How was it like growing up?
I wasn’t born with a silver spoon. I was born into a poor family in Nkwelle-Uke in Idemili North Local Government Area of Anambra State. In fact, my parents were extremely poor. I picked up this entrepreneurial stuff right from my childhood when I was in the primary school. In those days, there was free education in primary school, and my parents didn’t need to pay my fees. But in secondary school, up to tertiary institution, I struggled throughout paying my school fees, though I went to seminary school, but after my junior seminary, I opted out.
READ ALSO: BSU students protest arbitrary increase in school fees
Why did you opt out?
Initially, I was the one who desired to be a priest based on what I was seeing in them and the way they were doing their things. So, I took the exam and passed. I spent six years there. But, along the process, I noticed I wasn’t meant to be there; it wasn’t my line of calling. I noticed I was meant to be into business, because, while in school, during vacations, I was doing things that would bring in money.
Like what and what?
(Laughs) in the village then, I would go in search of palm kernels and palm nuts, and sell them at the market. My parents, I told you, were not rich. So, whatever money we gathered during that period, we will use it to support our going back to school. Within that period I was in the seminary school, I noticed my call wasn’t there. Therefore, I dropped out after my junior seminary, and wrote jamb and gained admission to Bayero University, Kano, to study Business Administration since I had already known where my passion lied.
So, how did you set out as an entrepreneur later?
Because of the poverty that was running in my family then, my elder brother, Osita, who is late now, wasn’t able to go to secondary school. After his primary education, he went for apprenticeship. His master was selling mattress. When I gained admission into Bayero University, I stayed in his house. While I was in his house, any time I was not in school, I would be in his shop.
When was that?
Earlier ‘90s. Then, there were no indigenous foam producers in Kano. They were all foreign companies, so the places we were buying foams were from either the foreign companies (like Vita Foam and some Lebanese companies), or we would travel to Onitsha to buy foams and sell. I was still in school then, but I was helping out. Later, one indigenous company sprang up in Kano, and started producing foams, and succeeded in bridging the gap of having to go to Onitsha to buy foams.
My brother and I looked over the whole thing. Incidentally, a brother of that indigenous foam producer was my school mate. So, I started following him to see what they were doing. That was when I started getting some knowledge on how to produce foam. Though we had an intention to go into foam production, my brother didn’t have enough cash. But the breakthrough we had was leveraging on our credibility. Don’t forget, there are five levels of money which people don’t understand: credibility, credible relationship, character, competence through acquired skill, and cash.
But many people don’t know these other levels of money except cash. Though we didn’t have cash, we are credible and we had credible relationship with people. For the fact that we had gotten the technical know-how on how to produce foam, we, then, met one of the biggest foam dealers in Kano, and discussed with him that we had the experience on how to produce foam and had already done our mathematics that, if we produced this foam here, it was going to cost far less than what they were buying in the market. We told him, if he could give us some money to get the chemicals required to produce the foam, we were going to hand all the products over to him cost-to-cost, which would lead to him having 30 percent additional profit.
He believed us and gave us the money based on our credibility and credible relationship we had with him. With that money, we were able to buy some chemicals and took it to that my school mate brother’s factory for production. He allowed us to use his staff and equipment to produce that mattress without paying him anything. Remember, I was working there without him paying me. So, that relationship we built yielded the trust. We were able to produce the foam manually and handed them over to our financier just as we agree. He saw the finished product, and it was very good, and the price was less 30 percent of what they were buying. In a space of 3-4 days, he had finished selling everything.
Did you use his brand name on the foam?
No, there was no brand name on the foam the first time, but what we did the second time was to print manually on the cover cloth the name we wanted to use for our company which was Gold Foam. That was in 1993. We produced freely for him for three months, and the man was happy with us. We now had a discussion with him to be giving us 10 percent of the 30 percent extra profit he was making from the foam. He agreed without argument being that the remaining 20 percent was still big for him. We, then, started taking our share of 10 percent in goods and was retailing it in our shop, which was still going on. That was what we continued doing until we raised enough cash to buy a land somewhere in Kano and started fabricating the equipment little by little. The land we started with wasn’t up to half a plot.
My brother later died in 2007. In 2009, I was able to go into full mechanized foam production on a 1.2 hectares of land. We have also succeeded in setting up another factory in Abuja on about 1 hectare of land. Right now, Gold Foam company employ over 200 staff, and has gotten other subsidiaries: in hospitality industry (we have Gold Value Hotel in Enugu). We have been able to go into furniture making in Abuja as well, and we have one of the biggest furniture showrooms in Gwarinpa, Abuja. We are also into agriculture (Gold Agric and Allied products Limited) in Enugu, which we started with 15 hectares of land. We have gone into real estate as well (CIS Homes Limited). All these companies sprang up from that small foam company (Gold Foam), which now have branches in 23 states of the federation.
What were the challenges when you started, and how did you overcome them?
Any new business you are venturing into must have people who are already doing similar thing before you. One of the greatest challenges was how to break even.
But one thing with me is that whatever business I am doing is idea-driven. So, we tried to come up with different new ideas.
Do you think there is an entrepreneur in every Nigeria, because we have many jobless Nigerians who are roaming the streets, hopeless?
(laughs) I believe that every human being has the capacity to become an entrepreneur, but it depends on how you develop yourself and your belief system, because, if you don’t believe you can do a particular thing, there is no way you can be able to do that. My own definition of business is thought processes, physical activities and systems built around an idea,meaning that whatever idea you have, you must back it up with actions and build systems around it before product or service will emerge and by so doing, you are an entrepreneur.
At a time many Nigerian companies are folding up due to recent downturn in the economy, you are still expanding. What’s the secret?
There are certain things you need to understand as a businessman. You have to study and understand the cycle of the economy. You just talked about businesses closing down because of recession. Yes, before 2015, if you had studied the Nigerian economy, you would know that Nigeria was at the point of entering recession. Recession doesn’t happen just a day. There are some indicators. When the price of crude (Nigeria’s major source of revenue) started falling down from 100 dollars plus to 30 dollars per barrel, coupled with Niger Delta militant activities that brought about low production of crude, you would know that Nigeria wouldn’t be able to fund its budget. By so doing, there would be less money pumped into the economy. This indicator automatically shows that the economy is gradually sliding into recession.
READ ALSO: Niger Delta militants withdraw quit notice to Yoruba, northerners
What a smart businessmen does is to save and invest during booming season so that, even when things are not going well (recession), you can fall back on your savings and investments, so the company can still be running and salaries paid. But, if you don’t do that, it means that when things are rough, you won’t be able to take care of your overhead, and your business will begin to go down.