‘Canon’s interest is to deepen market penetration in Nigeria’
Roman Troethand is the Managing Director, Canon Central and North Africa. In this interview with Business Editor, CLARA NWACHUKWU, ADEYEMI ADEPETUN and GLORIA EHIAGHE, he spoke on the importance of the Nigerian market to global investors despite the economic lull. Troethand, who called for improved forex regime in the country, also hinted of plans tot deepen Canon’s presence in Nigeria. Excerpts:
Why did Canon choose this period of recession to come and invest in Nigeria? Canon chose to come to Africa and this is the reason we have to establish Canon Central and North Africa. We cannot say we are successful in Africa if we cannot manage Nigeria, because the country is the biggest economy in Africa, and the potential in the market is very huge. Canon is a very strong company, and I think if we decide to go, we simply move and it doesn’t matter the moment, which the country is because I think we can grow with Nigeria together.
What led to that decision? Is it just the market size or are there other reasons?
The potential of the company is the potential of the country. Though, our market share especially in Nigeria is lower than in other countries, it simply means we have the opportunity to accelerate our growth. But for this to be reality, we need local people that will make our company grow. This is because we cannot establish or develop Nigeria from two walls, it’s impossible. We need local people, and I think the beauty is that we give our local people the chance to have a good job and develop themselves right in the organisation at all time and at the same time at the moment. Nigeria is reporting to us as a representative office now, but in the future, Nigeria is picking off to be an independent organisation with many people on board.
You said you are not going to set up a factory in Nigeria. So, what backward integration plans do you have, if any?
The office we have paid for is fully responsible for marketing and sales. That means we have our people who will decide what to do to develop the market. This is the first stage we are working on, we are not planning to have a factory here, not at the moment because the market is simply too small and too expensive to make a production here but you never know what is in the future.
Cost is an issue, and you said Canon is not going to set up plant in Nigeria, this means that you will keep bringing in your products, and looking at the challenges involved to access foreign exchange. How are you going to cope with all of these and still remain profitable?
At the moment, our aim is not to make profit, it’s simply to establish our pricing model and deepen the brand awareness. To increase the brand recognition, we have to invest first; the focus is not about the profit, not in the immediate. We believe profit will come later; our target now is to establish a strong base in Nigeria and in Africa.
Apart from the two products Canon launched, even though there are series of them, what other plans do you have for the Nigerian market in terms of expansion?
We are offering all products. From the slide shown on the power of Canon, we have everything from input to output. Of course, we launched and made all products available in Africa from the small selfie printer to the big machines.
Again, we have different partners, we have the MFI and Tenaui, who are more on to beat the means for the heavy machines, and we have Jamaica Trading Company, which is more or less involved in consumer products. But of course, we are offering everything.
Are you not going to do market segmentation? I don’t know if you did some kind of survey before you returned to Nigeria, is there specific markets you are targeting? You also mentioned Nollywood and the SMEs, what are your plans for Nollywood for instance?
Again, I think we are targeting all segments because we have products for all segments. What we introduced today is only our B2C products but we also have a B2B country manager and he is taking care of the bigger machines on a more professional manner so that he can cover the government sector, the corporate sector and then the small and medium enterprises. So we have different people responsible for the segments…
…Apart from offering products, are you likely to like invest in the making of films for instance?
What we will do this year and next year is to invest a lot in brand awareness, so you will see many bill boards of Canon. We will invest in a better service; we have signed a contract with Kensure for the services, good quality services because is not coming overnight. We have to give permanent training and permanent investment to keep the quality high.
And for the SMEs, what are Canons plans for them?
I think for the SMEs, for example, what we have done in Ghana, we have created small and medium enterprises to get better qualified to round paying shops. But again, since we are offering all products range , at the moment it is not only printing, we can offer anymore because the solutions is to make the printing save in a better document flow as it’s the new way of printing.
In the areas of competition, how has it impacted on your operations here and Africa as a whole?
We are in a competitive environment. Again, Canon is offering the best products available. On the other scene, we have to train the local people to be able to use the machines in a best way because if you don’t know what the machine can do for you, you cannot make the best use out of it. The top job we have to do is to train people how to use it and therefore we have introduced the Canon Partner Programme, the authorised partner for Canon products. If you see the slogan you will be 100 per cent sure that this product is coming from us and that there is somebody behind who can help you to use this product in a best way.
You talked about training, is it going to be free or for a fee?
We are giving all the trainings free of charge to our partners, we are not charging them. We invite them to other countries, we invite them to come to France, and we invite them to Dubai depending on where the training is. Trainings from us for our partners are always free because this is investments for us in the market so that our partners are able to serve the local markets or the local customers in the best way.
If you want to stay ahead of the competition, what would you say is Canon’s biggest edge over others?
I think it was said several times today that only Canon has all the input and output devices operating by itself. Only Canon has it, nobody else. We are the only one who has everything together. This is our biggest advantage.
Let’s look at Nigeria, it’s a big market and as such is prone to counterfeit and grey market activities. How is Canon going to manage issues around this?
Unfortunately, we have re-filling and we have counterfeit. The strategy in refill is introducing the G-series and the ink efficient ones so the printing costs are much lower. This is the first step that we have done but we have done some reset as in ink efficient compared to traditional printing is half the price and the G-series is much lower, this is specifically against re-filling. For counterfeiting, we have one department in London, which is fighting against counterfeit with the local authorities, this is what we are doing but it’s a long way especially in Africa to fight against it.
What is the possibility of Canon introducing a ‘trade in’ service, where I can bring my old device in exchange for a new one?
Actually, it could be a possibility because I did not think of this. But it could be a boom marketing activity and campaign that we are doing. For example, what we have done just two months ago, we invited people to come to our service centres to repair all their cameras free of charge for them. About 150 people came with their cameras. So we have repaired 500 cameras in one day. This was a campaign and I think that we could make this campaign for changing of cameras for new ones. It could be possible but it’s not now.
You have set your targets and a dedicated Nigerian team. How many more Nigerians are you going to employ to achieve these targets?
At the moment we have two country mangers, one is B2C and then B2B. We have at the moment six account managers, and we will hire one more for Nollywood writers and for video. For now, how many people we need depends on how many sales we make but I would say it’s a guess that in 2020, we will be a minimum of 20 people but we are at the moment six or seven.
How do you think government can help Canon grow its kind of business in terms of policy?
The biggest problem we have again is the availability of US dollar. This is the biggest problem. We have problems to import because they cannot pay us in US dollars even if the naira is available. I think we have the problem too in Egypt and Angola. In these countries there are not enough US dollars available.
This is our biggest problem at the moment.
The other bigger problem is the Naira itself. If the Naira is always stable, if it goes from 200 to 400 then to 600, it’s okay because somehow we can manage it. But if the Naira goes up to 500 goes back to 400 and then goes up again, I think this becomes a bigger problem. This is because the pricing will always change because when you are buying you have a different price and when you have a different price that is a big mess on the market. So, I think a stable naira and a few others, if this is restored we will have a bright future.
Are you not afraid of these fluctuations impacting on your profit repatriation?
Of course it’s impacting. Again, at the moment we are not looking for profit, we are simply saying this is the investment we have to do because we have to build up the organisation; we have to build up the understanding of the market. This is the first step and we are lucky Canon is a profitable company, we have to make sales in the next three years and not profit and that is quite a good start I would say.