- Pamela Chukukere, the founder of plantain chips startup, Spicy, is one of the employers of labour in Nigeria, where SMEs account for largest job opportunities
- The snack-on-the-go producer lost millions into the plantain chips business which she shutdown months before COVID-19 struck
- Chukukere is in a N2 million debt, and has been surviving with her bakery business, which employs five people, unlike plantain chips venture that had 18 workers
Food inflation is gradually making Nigerians jobless as small businesses grapple with the aftermath of COVID-19 on cost of doing business in Africa's largest economy.
Small scale and medium ventures are the engine of Nigeria's economy. They account for 84% of the employment in the country, 96% of businesses, and contribute 48% of national GDP, according to PWC.
It was gathered that 90% of manufacturing jobs are within the SME community, while 50% of industrial jobs also belong to the same category of business.
This is why the government rolled out palliative and intervention programmes to support small entrepreneurs, but not all of them are beneficiaries of these projects, and it's costing low income earners their jobs, as well as killing off SMEs.
One of such persons is Pamela Chukukere, the founder of the popular Spicy Plantain Chips, which once dominated the highways in Lagos State.
The grace to grass to grace story of Pamela
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Pamela is a superhuman among the small business community as she continues to find a way around every challenge Nigeria's business environment throws at her, to ensure she remains an employer of labour, without government support.
Three years ago, Pamela used to produce snack-on-the-go, plantain chips, and her company had about 18 workers under her payroll.
Spicy Plantain Chips generated between N150,000 to N200,000 daily sales, with sales season between April to December, as other months are considered offseason, which usually increase losses.
Annually, her startup was generating about N30 million to N40 million when the daily sales are pegged to the number of days between the start of Q2 to the end of fourth quarter.
Despite this huge sales, her business was running on losses as it was not profitable. In spite of this, Pamela kept pushing until she could no longer bear the loss which pushed her into over N2 million debt.
Challenges that ended Spicy Plantain Chips?
Pamela told Legit.ng that she didn't have control over the market price of plantain chips. According to her, the buck buyers or distributors determine the product price.
The baker said if cost of raw materials like oil, plantain and gas increase, as the producer of the chips, she can't implement the cost into the price as the buck buyers put the final price of a pack at N100.
She explained that the street sellers will only hawk the products that sells to them at a cheaper rate, any attempt to raise price, the buck buyers will go to the competitors - and the buck buyers know the best selling areas.
Pamela also struggled with the middlemen buying plantain from farmers and selling to plantain chips makers. Legit.ng gathered that if the middlemen buy a coach, which is 12 dozens of plantain for N4000, it will be sold to Pamela and her competitors at about N30,000 to N40,000.
Part of the challenge includes food inflation that was on the rise for years. While telling Legit.ng the difference between prices of raw materials between 2020 and 2021, she said:
"The cost of raw materials have not come (down). Now is even the worse time for anybody to do plantain business. Like last year, a bag of plantain is N3,000, now a bag is N15,000.
"This time last year, oil was N11,000, now its N25,500 as at yesterday, and they (Plantain sellers) are still selling at N100. There's no profit at all.
"Gas before now is N4000, now its N5,500. Nylon has gone up again, so there's no profit. Before we buy a single of that size (plantain pack) at N150, now its N300."
All these pushed Pamela into the debt of N2 million.
"I'm still into that debt of over N2 million."
Pamela makes plan B her fallback option
As the plantain chips business failed to become profitable and push her into debt, Pamela decided to fall back on her baking experience, which has sustained her since she quit in 2019.
The change in business focus cost her plantain chips employees their jobs, and reduced the number of workers under her payroll. Pamela who once had about 18 staff, now has five.
"I was doing baking and I was doing the plantain, and so when plantain went down, I went fully into my baking."
When asked about the impact of food inflation on the bakery business, Pamela said unlike the plantain business, she could control the price, and increase anytime cost goes up.
"I sell what I produce. I sell what I buy. The (price) of my eggroll will go up (if egg price increases). Like cake, before now, the cake that I sell N5000, I'm selling it N9000-N10,000.
"But in plantain, you don't have control over anything. The buck buyers (guys that sell in traffic) call the shot."
Pamela also trains aspiring bakers who get employed, and she gets paid for it by the employers.
Pamela yet to benefit from government intervention
The businesswoman told Legit.ng that she had tried to request for government support through one of its intervention programmes, but she hasn't been lucky enough.
"I've applied like two or three (times), but I can't remember the one I applied, but it didn't go through."
Pamela is in NPower, but she hasn't been paid.
Co-founder of Appzone, Obi Emetarom, failed in two businesses
Just like Pamela, almost all entrepreneurs have a failure story, and one of them his Obi Emetarom, the co-founder of Appzone, a financial software company.
Before Emetarom established Appzone with Emeka Emetarom and Wale Onawunmi in 2008, he had failed in two businesses, one of them being a table water distribution company.
After that business failed, Emetarom established another venture. This time, an airtime topup business which is enabled by a mobile app, and also has a kiosk.