Since we last spoke with the Nigerian Bottling Company it has seen skyrocketing costs and a competitive market, but it continues to invest in Nigeria with impressive results.
The Nigerian Bottling Company is part of a global operation, manufacturing, distributing and selling Coca-Cola products to the Nigerian market, making it arguably the number one soft drink brand in the country.
We have looked at this company before, and been impressed by the excellent results it has achieved over more than 60 years in the country, but it has by no means rested on its laurels since we last spoke.
“We have looked at how we can engage and change not only the culture but the capability of our team,” says Matthieu Seguin, Managing Director of the Nigerian Bottling Company. “We have taken a few key steps.”
One of those key steps has been the firm’s recent engagement survey among its own staff. Even though the survey is entirely voluntary, it has seen a 99% response rate from employees, and the company has scored 92% based on that survey. This is the highest score among similar companies across 29 different countries.
“It doesn’t mean everything is perfect,” Seguin insists, still keen to find room to improve, “but it recognises our efforts.”
Those efforts continue with the company’s years-long investment in the capabilities of its people. Six months ago, it expanded its in-house Supply Chain Academy.
“This is end-to-end, covering not just manufacturing but logistics and procurement, the whole supply chain,” Seguin says proudly. “Just last month 168 people graduated from a group certification on the supply chain, above and beyond what we usually do. That was at our biggest plant. Just next door we have a vehicle training centre for our drivers. We invest a lot in our people because we believe our people are our most valuable asset.”
That asset is critical as the Nigerian Bottling Company works to serve its 200,000 customers and the communities living alongside where it works. This does not just mean training, it means empowering people, including women’s empowerment, hygiene, sanitation, recycling, and providing jobs within the community.
A Challenging Time
And that work is more important now than ever.
“2021 was an excellent year for us, but we have seen challenges in a few areas around cost increases,” Seguin admits. “We have had high inflation in double digits. The cost of raw materials, the cost of energy, everything has doubled or tripled. That is one factor. Then in June, we faced the introduction of excise duties.”
While the Nigerian Bottling Company has had a good first half to the year at the top line, in the third quarter that excise duty had a serious impact. The company had no choice but to pass the additional costs onto the customer, but the customers themselves were already under strain from rising food and transport costs.
“They have to make choices, so that didn’t help us at all,” Seguin says. “We hope things will be better in Q4. October was not a good month for the whole industry.”
As well as economic challenges, Nigeria has also been impacted by the changing climate, with heavy flooding affecting many parts of the country and a colder-than-usual summer impacting customers’ consumption of the Nigeria Bottling Company’s products.
Seguin is sanguine about these combined obstacles, however.
“These are key challenges which are here to stay, and we have found ways to mitigate some of them,” he says. “We are used to the roller coaster of Nigeria and what does not kill us makes us stronger. We hope tomorrow will be a better day and are committed to Nigeria as a country.”
A Time of Transition
When it comes to mitigating those challenges, the Nigerian Bottling Company has plans to accelerate its transition to gas power and has already installed solar panels in almost all of its plants.
“It is a way to not only drive down costs but also improve the net zero impact of our footprint,” Seguin points out. “It comes down to focusing on what you can control, alleviating the impact of the shrinkage of the economy. We are asking how we can take a bigger piece of the pie. For the last 15 years, we took 15 points of market share. We plan to continue to take the best of what the market can offer and keep developing ourselves and adding value for our consumers and their communities.”
Seguin’s plans for the future are to continue accelerating in the areas where the company is performing strongly. Some things will change but he intends to continue growing the team and its capabilities, adding new resources and new ways of working.
“We are focusing on removing internal barriers, having the right attitude across the company, simplifying our business where possible,” Seguin says. “We want to accelerate our work around climate change and sustainability.”
Already the company has taken steps to collect more of its used bottles, partnering with other players to set up recycling capabilities.
“We source back local content to increase the amount of recycled content in our products,” Seguin says.
Over the year since we last took a look at the Nigerian Bottling Company, the firm was invested, but it has also been expanding, building on what has come before.
“The good results we have had for the last couple of years came on the back of investments we have made as a company over the last decade,” Seguin insists. “We have made a billion euros of investment showing our commitment to the country. The fact that we have been able to grow and develop is thanks to that, and our investment in people and new capabilities.”
This has involved adding new production lines, increasing warehousing, and adding new canning lines.
“All of these investments have been decided to help us make the most of the opportunity we have in Nigeria,” Seguin says.
It is clear talking with Seguin just how much of an opportunity he believes that is.
“Nigeria has a population of 211 billion. It is very dynamic and vibrant, and from a market penetration standpoint we see huge opportunity,” he says. “We have seen great results here, but we can do so much more.”
He also recognises that this opportunity comes with risks.
“It’s not about strategy- it’s about execution,” he says. “Our belief in this country is very strong. When you do the right thing here it goes very well, but it is an extreme country, with high highs, and low lows. If you do the right things, with the right brands and the right route to market and marketing, while listening to the consumer, it will work out for you. We see that day in, day out.”
