Roni Madhvani, Director of the Madhvani Group, Uganda’s largest conglomerate with a total asset base in excess of $1 billion and businesses spanning agriculture, construction, hotels and insurance to name a few, discusses the vast potential for investors in the country’s tourism sector.
Could you tell us the key steps of the evolution of Madhvani Group over the last century?
Sure. My grandfather came over 100 years ago. We have very humble beginnings and I think that spirit still continues as part of our approach to business and all our stakeholders. Basically, the business evolved from agricultural roots and with sugar in particular and subsequently diversification 1950s and ‘60s led to manufacturing glass, beer, steel, soap, edible oils, packaging, etc. More recently the group has expanded into other areas such as construction, power generation, tourism and insurance.
What are the strengths of Uganda’s success over the past few years?
I think the key for economic development and growth is peace, political stability and continuity. And, in Uganda, with the present government, we have had that for over 25 years and that is a mandatory pre-requisite for any business when you are looking to invest anywhere in the world. So that is some of the attractions of Uganda as an investment destination.
Last year around 1.5 million tourists came to Uganda. As the former Chairman of the Uganda Tourism Board, what are the key challenges to overcome in order to become one of the main touristic destinations in Africa?
First of all, I would like to correct that in terms of the numbers. The 1.5 million refers to the inbound numbers coming into Uganda by road and air, and it includes business travelers, it includes people who are bringing goods over the borders etc. So this figure doesn’t truly reflect actual tourists. The more correct number for actual tourists for 2014 is estimated at some 150,000 and this can be substantiated by entrants visiting our national parks. If one compares this to Kenya or Tanzania where that number runs in the couple of million, we still have potential for the tourism sector to grow.
So, there is a lot of opportunity. Of course, tourism is an important contributor to the economy despite the numbers being so low, but I think we also have to be aware that the tourism offering is totally different and unique from Kenya and Tanzania; they are based on the numbers game. In Uganda, we are different, we don’t have the quantity and quality in terms of numbers of wildlife and the offering is more discerning. So, when someone is looking for a less commercial experience and something that is totally different, Uganda is the destination of choice in the entire continent. That is part of our uniqueness. In our neighboring countries, if you see a pride of lions you will also see 40 or 50 minibuses around them; in Uganda if you go out on a safari you will probably be the only one there. It’s unique.
The second thing is the actual offer in itself. Uganda ‘s tourism is so diverse and nebulous; you can be mountaineering in the snow-peaked Rwenzori Mountains, viewing incredible wildlife and ornithology on water safari, or whitewater rafting on the mighty River Nile… so many things. It’s not just about the safaris; it’s much, much more.
In terms of marketing strategies unfortunately we have been labeled primarily as a destination to have an encounter with the rare mountain gorillas, which in itself is another unique aspect, but in actual fact there is so much more to do and see in Uganda.
The Silverback Lodge is often considered as your flagship lodge because of the population of gorillas nearby.
Silverback Lodge, which is our property located in Bwindi, home of the mountain gorillas, is one of our four properties, but isn’t our flagship. The others include Chobe Safari Lodge, which is in Murchison Falls National Park, and is built on the banks of the river. We also have Paraa Safari Lodge and in Queen Elizabeth we have Mweya Safari Lodge, an absolutely breathtaking location. You cannot see views like that anywhere in the world, I guarantee. If I could give you your money back I would if the view doesn’t take your breath away!
Apart from the variety of landscape and wildlife, how can you ensure an extraordinary experience for your customers?
I think the interaction that one has in Uganda is truly with nature and so unique; for example if you go to other so-called safari destinations on the continent you can go on a safari and the roads are paved – that is not a safari in our mind. Here, you go out in the bush, it’s a discerning experience; you actually are in the wild, it’s amazing. And Uganda’s landscape is not only beautiful but also diverse. You can go to the west and you will be in lush green hills and mountains; or you can go to the north where the climate is more arid or to the east. It is amazing. We are a small country but the offering, the differential is quite awesome.
What have you implemented in terms of trainings to provide high standard services in your lodges?
First of all, if you are looking for a Four Seasons Hotel out in the bush, you are not going to get that. Yes, in South Africa there are certain properties where you pay a lot of money and yes, it is by all global definitions, luxury. I think when one comes to safari you have got to be open and willing to experience the truly wild side of it. So, if you are expecting butler service in your room, this is not going to happen.
When you come on safari you have to have a different mindset and be willing to experience what the offering is. For me, the prerequisites of a good safari with a wonderful encounter with the wildlife, birdlife and nature is that when you come back after a long game drive or something else, you want a hot shower, clean running water, good food and a comfortable bed to sleep in and, if it is too hot, to have the option of having air conditioning. So it’s a different experience all together.
To answer your question about training: I think one of the key challenges facing Uganda is the staffing and the experience of our people. They don’t have the exposure to see and to benchmark what different standards of service are. We are fortunate and blessed that we have properties in Kenya where we are able to send some of our staff from Uganda temporarily, and they are able to see and expose themselves to the different levels of service that can be achieved. So when you can compare, you come back and you see that what we are doing here is not necessarily the best and that we can improve ourselves. And that is pretty much the same for all industries if you are able to send people outside where they can open their minds. This leads to self-improvement.
Within the Madhvani Group, there is also the Uganda’s largest private education foundation. This year, the Madhvani Foundation will make available for scholarships 700 million shillings. Why is it so important for you to give back to the community?
First of all, our foundation has long antecedents. It was setup in the 1950s, so it is long standing, long before it became fashionable for companies to get into CSR. The Foundation supports bright and disadvantaged Ugandans who ordinarily would have dropped out of universities for the lack of sufficient funding, to complete their education in certain recognized disciplines. We feel educating our youth is one of the key drivers for the development of our nation.
What other CSR activities do you implement?
In our business and our corporate culture, giving back has always been an important part, right from the beginning. Each one of our businesses has their own CSR program. For example, at the Safari Lodges they pick projects, so at Mweya Safari Lodge, we are helping the local fishing village by building a school and growing the school. We are involved in conservation in many projects we support. In Kakira, where we have our sugar business, we support about eight orphanages. Within the community the biggest project is called “Kord” where basically we buy sugarcane from about 8,000 sugar farmers. So for every sugarcane they sell to us, we contribute a certain amount and the farmer contributes a certain amount. So with that fund we basically develop the local community, so we have built schools to help the farmers and they run it, the NGO that we have set up. And that effort has been recognized by the World Bank, so we are proud of our CSR programs. Giving back is absolutely mandatory and besides that it should come from within your conscience to want to give back.
How could Uganda benefit from the TGAIS in London in December? And, what would be your message to the investors and businessman who will attend this conference?
Our President’s message will be clear: Uganda has tremendous opportunities within all areas of business. We welcome business to invest in our backbone, which is agriculture, and not just primary agriculture but to add value to our agricultural commodities.
In manufacturing, I think Uganda has a quite small population, relatively, and with a disposable income that is limited, but it is within a broader community –Uganda is a springboard to the other markets in our part of Africa. For example, many goods come in from Kenya, through the port of Mombasa to go on to South Sudan, Burundi, Ruanda. So you have to look at it in terms of the broader market, not just in terms of Uganda itself.
And in terms of tourism in Uganda, what would be the key business opportunities?
I think as the numbers rise, there is a tremendous opportunity to grow. I don’t think we are looking for Holiday Inns at our National Parks, because it is not a number game, but in terms of offering a discerning experience.
For example, in terms of air travel, at the moment it is expensive compared to, say, Kenya or Tanzania. So if people are willing to invest in that sector, there are lots of opportunities. I think on an international level, we have British Airways servicing Uganda, but unfortunately they are pulling out at the end of this month, so there is an opportunity for a world-class airline to enter this market.
There is a lot of business, we all travel and we don’t necessarily want to fly through other European countries, but if there was a direct flight to London, for example, it would be wonderful. There is also an inherent demand, so if Richard Branson reads this…!
What is your dream for the future generation of Ugandans? What do you want them to achieve?
I actually look at the problem from a broader angle. I think the crisis we are facing in the Middle East and North Africa is related to unemployment. I think the world has spent a lot investing in educating the youth, in the last few decades and they have been empowered to think and to question and after being educated there simply aren’t enough jobs for them. The challenge for the future generations of Ugandans is to be able to provide them with a livelihood and a future.
Can you tell me in a few sentences what represents Uganda for you?
It’s tough. We have so much to offer. It is beautiful, people are the friendliest, and I’m not just saying it, it’s true. The fact that you have stayed here as journalists as long as you have, you can testify to that: the beauty of the country, the people, everything. So many things that come together under one umbrella that you can’t quantify it.