Shumei Lam is the daughter of one of Singapore’s most celebrated entrepreneurs, the late founder of Portek. She's inherited much of her father's pioneering business spirit, setting up a poultry business in Rwanda. African Business spoke to her about this initiative.
The whole idea of setting up a poultry business in Rwanda came from Shumei Lam’s late father, Larry Lam, who was one of the first investors in Rwanda through his company Magerwa Ltd, the forerunner to Portek.
“It started from an email exchange between my father and the ex-general director of Magerwa, on how they could assist in boosting food nutrition in Rwanda, because Rwanda has very low levels of consumption of meat protein,” Shumei Lam says.
She went on to explain that in Rwanda, chicken meat is typically eaten just on special occasions. That is unusual as in most parts of the world, chicken is eaten more regularly.
Following Magerwa’s sale to Mitsui in 2012, Larry Lam made a conscious decision to focus on social impact projects. “He decided to try something in Rwanda’s agricultural sector,” Shumei says. “Initially we were looking to import animal feed, but because of the high cost of import tariffs, we decided to look at an integrated project. That gave us the idea of the poultry project.”
Asked what the challenges were in establishing her business, Shumei says: “I think from day one you know there are challenges, and every day is like swimming upstream! It is a brand new idea for Rwanda - people don’t really understand the concept of a modern poultry farm.
“So I think we have really come a long way with the idea, but the cost of importing everything is expensive because of Rwanda’s inland location. Not everything is available here, so when you’re planning for a brand new set-up you have to be very, very detailed in exactly what you need, because absolutely everything has to be imported.
“But when there’s nothing available here, the opportunity is there for investors such as myself to come in and make a difference in the economy and the lives of the people,” Shumei adds philosophically.
That the nation is developing is in no doubt, but many businesspeople who come to the country still experience quite a strong culture shock. “You know, the concept of time here is different,” Shumei observes.
“I guess my expectations in terms of efficiencies, also in terms of teaching my managers accountability, trying to implement processes, systems reporting - all these things are challenges because they are completely new concepts to the people here,” she adds.
Shumei is busy developing the three elements of her business - a feed mill, the farm and a processing plant, all of which are quite brand new concepts for Rwanda.
“We have to basically train local managers from scratch to operate these different segments of the business,” Shumei says. Scaling the business up to full capacity and other elements to the business is challenging because of the lack of available skilled labour here.
But Shumei is absolutely determined to build capacity. “We were established as a social enterprise. So, the concept is to be a commercially self-sustaining operation. We focus on social impact. Part of the plan is to eventually branch out into contract farming, giving other farmers the opportunity to own their small enterprise and also allow them the opportunity to participate in the market.
“So with contract farming we can actually grow our production and there’s a lot of opportunity to expand both upstream and downstream. Utilities can be a bit of an issue, electricity and water supply are not always consistent, especially in the area that we are operating in, Bugesera, and we have issues with packaging as plastics are banned in Rwanda; also the cold chain is a huge issue.
“However, one of the good things about doing business in Rwanda is that it’s organized and the government has a plan. And they are also receptive to co-operating with the private sector to draft regulations on food safety, on standards, even on tax regimes. That is a huge plus for us.”
This article was first published in African Business magazine, June 2015 issue. Copyright IC Publications 2015. Published under permission by IC Publications www.africanbusinessmagazine.com.