Saturday, Oct 21, 2017
Agriculture | Africa | Kenya

Squeezing added value out of Kenya’s fruit


3 years ago

Kimani Rugend, Kevian’s Managing Director
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Kimani Rugend

Kevian’s Managing Director

Kevian is a Kenyan drinks company that has been producing water and natural fruit juice beverages since 1992. In this interview with United World, Kevian’s Managing Director Kimani Rugend discusses the history of the company, the quality of its products and future expansion plans, which include a venture into soup making and expansion to the US.

You founded Kevian in 1992 and became an industry leader in short time. Could you give our audience a bit of a history of Kevian and the key factors to your success?

From the onset, things were a bit rough. We started during the times when there were problems in Somali. Bottled water was really a luxury to many, but we realized our water was getting polluted. Initially, we saw a need for packaged water. Kenya is an agricultural country; venture out and you may find coffee farming. The use of weed killers and insecticides are quite prevalent and that water is reabsorbed into the national grid. At that time, there was not much equipment for the purification of water. Our first step was to acquire sand filters. We had to find the best team to run this equipment as well.

As time went on, people began realizing that they should buy bottled water or suffer from water born diseases. It was a binary choice. At that time, there were only three bottled water companies. When the Americans were active in Somali, we were lucky enough to be contracted as their water suppliers.

We continued trying to grow and get stronger. About 2 years later, we were approached by Coca Cola, who wanted us to bottle their water so they could sell it along with their other beverages. It never went very far. We exchanged a few communications. As we went on, we realized in this country there are a lot of fruits. The sun enhances the flavor and sweetness and we started experimenting. Rather than going the Coca Cola or Pepsi way, we focused on fruit-based juices. We started with mango and passion fruit, then tomato, carrot and pineapple. Then, some diseases started to strike our vines. We asked who would be able to help us enhance our productivity. The available NGOs were involved in agriculture, so we collaborated with them along with the Minister of Agriculture. We had field visits with farmers for fruit improvement, and this helped boost the quality collection centers. We grouped farmers in farmer groups so they could audit themselves. It would be very difficult to audit little farmer groups.

Luckily, the ‘M-Pesa’ method of payment came into being, so we are able to send SMS, and actually communicate and pay individual farmers. At the end of the day, when they deliver, everyone receives their money. Once the quality is assessed, farmers get their money. By the end of the day, they don’t have to go to the bank; they just receive their money in their telephones, and can pay others. That has become very convenient. That came in time as we went on in the production.

Early on, the thing was where to get equipment. Our next bet is always Europe. We have to go to European exhibitions, but nobody could do our project from A to Z. I had to do it myself.

All our products are natural, ingredients are local, and you can find our products in hotels, and in Kenya Airways. We also have cherry and tomato juice.
We are thinking about expanding to America, but to offer something that Pepsi and Coca Cola are not.

Currently the potential for the juice market in the region is worth $1.7 billion, with energy drinks another $1 billion dollars. In Kenya alone, the national juice is worth 7.2 billion chelings. With such huge potential, what are your growth strategies? Where do you see opportunities to capture market share from Coca Cola and EABL?

They have all their cut in this. Anything we have come up with is just to say we are still there. Where our strength is, is our relation to the farmers, our fruit-base and the natural character of our products. We categorize ourselves in that area in a rightful position. We move through the whole value chain, from the farm to the market. We are crushing fruit. The crushing and the packaging use 200 tons of fruit every day. That, in itself, is giving us enough raw materials to last us the entire period for the moment when fruit are not there. Therefore, we can offer uniform prices through the year.

I read an interview where you said that the well-being and happiness of your employees is one of your primary concerns. Why do you feel so strongly that happy employees equate to better productivity and higher revenue?

We also ensure that they are adequately compensated, and that their ideas are taken into account. Not only managers are the source of information. Proper and good ideas for better business can only come from the floor. We have constant interaction with our workers and keep sharing ideas. When I am down there, we are all workers.

You said you work with 3,600 farmer groups.

Farmer groups are any number between 75 and 100. But they are still small farmers. They have one head that is constantly on the phone. When we want to know what kind of chemicals they will use, we talk to him. We help them with productivity and quality. Now we are helping them, and I am happy to say that the USA is also helping. We want to help them enhance the fruit nurseries and also try to convince the Ministry to accept Mango trees as part of our forest cover.

When you look at the EAC or even greater Pan Africa, where do you see opportunities for growth?

Opportunities are tremendous. We can see ourselves tripling or doubling. Obviously, we are not forgetting that some fruits are not grown in other places of the world. Pineapples here are much better and less acidic. The sweetness is there and acidity is low.

You are arguably the pioneer in the food sector here in Kenya. What did you see that other people didn’t?

We realized there was a missing link, from the farm to the processer. Farmers were disappointed. They weren’t getting cash. The fresh market can only absorb a 10%. When fruit is right, it is right. If you leave it, maybe you can delay it with some fruits using wax or something, but not the rest. You can’t freeze all of them. So, again, you want to enhance the sweetness. Try to take a frozen banana, it is not the same. If you eat it in its natural form, it gives you a different kind of flavor
.
We help farmers use the 90% they can’t sell in the fresh market. In the processer, we clean fruits, then we select them, then they go to the crushers, and then good juice goes through fast pasteurization at 70 degrees in the cooker, then it goes to the next one, then you sterilize and then bagging.

Could you tell us about your new products?

We saw an opportunity in soups, something that is not done here. We use carrots, and other vegetables. We did some R&D and found that the product was working. It is about two years old, if you count development; but packaging is two months old. We are confident that it has 12 months shelf life.

If people at lunch, wanted to have something quick, they didn’t have anything. If people have sandwiches in offices they could have a soup with that. They are made with Kenyan tomatoes. We have been working product by product. We find that the products do well.

Which products you are looking to expand to America with?

The Pick n Peel range is already there at Wholefoods. There is someone who is buying from us, but I don’t know where he is selling our products. If we could also get soups, we have an equivalent of Heinz tomato sauce.

Another interesting quote I read from one of your interviews was that you wanted, within the next 20 years, to have 55% of all companies being Kenyan owned. What do you think needs to be done in order to achieve this?

The Kenyan people are, by nature, very hard working. The wood industry could actually supply Europe with furniture. All you need is to enhance your workshops and showrooms and give them some facilities they don’t have. However, my saying I’d like to see 55% of Kenyan owned businesses is only looking at the fact that there are so many opportunities. Perhaps it is a question of realizing when to grab it.

You’ve been praised as one of Kenya’s top industrialists. What advice would you give to young Kenyans?

I’d like to see a different kind of approach at looking at would-be Kenyans. If you look at people working in the informal sector, investors should come into those industries. In short time, those shelter workshops could become big industrial centers.

Young people have to remain focused and follow their dreams to ensure they come true.

I have been here for 5 months. I know the hard working nature, passion, integrity, and team work that embody Kenyans. If you had to explain the competitive advantages of Kenyans to our American audience, what would you say?

People trust on their ability to do things. However, the world has changed. It is not a question of ‘I can do it’. We are interdependent. You have what I don’t have, and if we combine, we can do great things. Americans and Kenyans should look at areas of need, and what the minds need. Greater ideas will be born.

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