Mrs. Ibukun Awosika is the founder and CEO of the Chair Centre Group. She is a business magnate par excellence, and currently serves as the chairman of First Bank Nigeria; the first female to hold that position. Her success is an inspiration to many, and today we bring the true story of how it all started as told by Mrs. Ibukun herself.
At the Second Convocation Ceremony of the Entreprenuership Development Center (EDC) Lagos, on November 20, 2009, Mrs. Ibukun Awosika delivered an address as a Guest Lecturer. In her address, she told the story of how she found her way into the furniture-making business and became an entrepreneur at the age of 25. She also shared success nuggets for your business.
Read her address below:
I am here this morning primarily because I believe in what this Centre represents. As a Nigerian who is passionate about my country, I believe that it is greatness to unveil the truth about Nigeria and facilitate other people around us. One of the most painful things is to see a lot of families train children through the universities or the polytechnics. It is more painful when for two, four, five, six, seven or so years after graduating from these institutions; most of them can still not work, not because they are unwilling but because there is no work. There are about a hundred and fifty million of us. Whether we get the figure right or wrong, the bottom-line is there are a lot of us we need to carry along. And the only way we can facilitate them is to arise and deal with it positively, creating true value.
My assignment this morning, which is to look at entrepreneurship as a viable option to white collar jobs, is a duty I must carry. I would start by telling a little of my own story often mistold in many places. I understand that it has been read on the internet. One of the areas we have to work on is the area of our journalism, so that they can accurately report news and give information correctly.
I went to Ife (University of Ife, now Obafemi Awolowo University) and studied Chemistry. Was it because I loved Chemistry? No. I could pass very well in school, and I passed the sciences. I also loved Arts and I could draw. Initially, I wanted be go into Architecture. Anyway, I got into the university to study chemistry. Did I enjoy my university days? No, because I didn’t even like Chemistry. In-between that, I wanted to be a lawyer. I put in a lot of effort to see the Dean of Law to accept me into Faculty of Law. But I have to fail the chemistry for chemistry to release me to Law and Law wanted me to pass with the best result in order to accept me into Law. It was all confusing. By the end of that year, I changed my mind about wanting to become a lawyer. I decided I wanted to be an Accountant. So, I started taking a lot of electives in the Department of Accounting.
I took elective courses in Accounting from Part Two to Part Four. I made sure I went to serve (National Youth Service Scheme) in Akintola Williams & Co (now Delloitte). I also did that so I could take my accounting exams with the hope of just going to work in a bank later. Like many young people, I thought it was a good idea. When I got into Akintola Williams, within the one year of my service, I discovered that I hated Accounting. I was good at the figures but I hated the idea of moving from one company to the other going through old dusty files. I didn’t need anybody to tell me this. I was too restless to just keep following some certain procedures that are laid down. I was so restless and I needed to be able to express myself as there was no room within auditing to do that. At the end of my service year, even though they offered me permanent employment, I turned it down, I served in Kano and I came back home. My parents were wondering what to do with me. I wanted any job, anything I could do. But the first job I found was with a furniture company and I didn’t care. I took the job because I just wanted to be busy and I only lasted three and a half months with that company. But it was three and a half life defining months for me. Within those months, I discovered why I wanted to study Architecture in the first place. Within the context of furniture, I discovered I could play around with space. I loved the process of creating and designing furniture. I could turn this place around but, I hated that because they were Lebanese and their values were quite warped. And without thinking much, I said to myself I could do this, and I could do it right, and I left that company to start a manufacturing company.
Do I have capital? No. The three and a half months were critical to my life story. Within those months, I saw the inside out of furniture making. I understood what is involved. Did I ever think I could go into furniture making before then? No. I never did. Not for a second did I think of doing that. But from the onset, I made up my mind that any customer who is interested in my product should pay 70 per cent upfront. So what do I need a start-up capital for? The customers provided the capital.
Did I have a factory? No. Did I have workers? I could only afford to hire carpenters, but I didn’t have to pay them for one month. They operated from their workshop. Their service was in advance but their payment was in arrears. I also had labour in advance. Did I have the machines? No. But all the machines and machinists were available. I paid per unit of what they produced for me. I didn’t need a generator because they would provide their own generator. I was paying them for what they did. For spraying, I discovered that I could rent a spray gun on a day-to-day basis.
Everything I needed was in the system. The carpenters came with their tools. So I didn’t even need to buy tools. All I needed was to have a place to operate from. I noticed that furniture making company need basically three divisions -carpentry, upholstery and spraying. So I engaged three carpenters, two upholsterers and two sprayers. We were seven. So where do we start from? The chief carpenter said there was an uncompleted building close to his house. The man lives in Ejigbo. I had never gone to Ejigbo but I had to go because what I needed was there. The next thing was where do we get jobs from? When people heard that one of our first customers was Prime Merchant Bank, it sounded so big and great. But I had handled the transaction in my former place of work. I went there to see if there was any extra job that they could offer me. I treated them well. But how do you give a bank’s major furniture work to a 25 year-old girl who had nothing? All the same, I went there and they felt it would be nice to also be nice to me. The first order I got was to supply wooden trays and wooden dust bins. I took it because I wanted a foot in the door. I just needed a starting point. We worked on that like our lives depended on it. They had a lot of young staff who were just starting life so I took all manners of jobs – people who wanted stools in their houses, bed and all sorts. Every job was a big job and so we plugged ourselves into it. Six months later, there was a furniture show at the National Theatre and I decided we were going to go there. All the big guys, of course, were there. I needed to showcase that we can also do it. We have the skills, what we lacked was the network. So I scrounged all the monies we have to pay for space at the show.
My guys made assorted furniture and for the one week period of the show, we went there and we had to close workshop. Whilst we were there, Texaco Nigeria was building a new factory at McCarthy, and they came to scout for a company that would supply their furniture. We were there among the big guys, but nobody realised that we were a tiny, little dot. We made our paper work and had a good presentation. Our attention to details was different from theirs. By the time we did the samples, we were shortlisted among the best. You can image how hard we worked on it. At that point nobody was dealing with me. They were dealing with the quality of our work. By the time TEXACO awarded the contract, they had given it to a tiny, little company that had nothing.
Now the difficult part. Oil companies do not pay down payment for their jobs. You have to go and look for money to do the job. In 1989, the value of the 66 chairs and tables was N166, 000. I had to look for N50,000 to add to the savings we had made over time. The bank that I had worked for could not risk their money on us. I looked for the N50,000 all over Lagos, but nobody offered a helping hand. It was one person who was starting a finance company and believed in me that offered me a loan. We were able to prove that we could do excellent jobs if we are given the opportunity.
But TEXACO didn’t move into the building and for five months, we were paying interest on a loan that we could have paid off in two months. Did we have problems? Yes. Two weeks after we delivered those chairs, 28 of them were broken. Not because of us but the base of the chairs were not too good. I had done my research and got warranty on the base from a Syrian or Lebanese company at Oshodi, but the warranty didn’t work. For a company of our size, it was a big loss. We could abandon the customer and move on. But my name is more important than even the money. I however chose to maintain our integrity and retain our credibility. We replaced them. It was a killer. But I realised that we stood to benefit more if we do the right things at all times. That job produced many other jobs. It will be 21 years in January since that 25 year old girl started her entrepreneurship. As at today, the company I run makes turn-over in hundreds of millions of naira. We have the largest office furniture factory in the whole of sub-Saharan Africa set up with the largest French furniture manufacturing company here in Nigeria. The factory is at Ileje in Ibeju-Lekki area of Lagos. Our second factory is at PUNCH premises in Ikeja here. I have an expatriate as Factory Manager. Apart from him, every other person is a Nigerian.
On Monday, I will be jetting out to sign a strategic partnership agreement with one of the top three furniture companies in the world. They came to the West coast of Africa to look for us. It’s an American company, a big player in the global furniture market. I know them by reputation and name. It’s an awesome deal, I tell you. Your starting point is irrelevant. If you insist on doing the right things and doing it well. Don’t give me the crap that this is Nigeria. That is things are done in certain ways. That is not a sustainable theory. No, Nigerians have value and it’s not right that Nigerians are corrupt people. There may be some corrupt people in Nigeria. Nigerians have integrity and value it. There could be some people without integrity, but such people also exist in other countries of the world – It’s not peculiar to Nigeria. Who you are is who you choose to be. Tell me a Yoruba or an Igbo or a Hausa man who knows where a thief is celebrated? Where is it honourable to do what is wrong in Nigeria? We need to change the image of the country from the bad image that the corrupt minority do. Every one of us should know that we need to seek knowledge to whatever extent possible.
Take a personal decision to be excellent in whatever you do. The only reason a French company will concede 21per cent equity to a Nigerian company is because we have a track record. The only reason the company that I’m signing strategic partnership agreement with in the US is because when they were looking for information, one of our clients, an international bank said we are the best. It is the way we relate with them. What makes the difference in whatever you choose to do as an enterprise is to make the first one look the best. You also ensure that when you get to the 1000th, you remain the best. Take whatever knowledge you have learnt here seriously. Seek knowledge to whatever extent possible. Take a personal decision to be excellent in whatever you do. My commitment is to deliver international standard and topmost quality business within Nigeria with pride without saying this is Nigeria. A time would come when the guy who knows the right thing would come up and when he does, he would judge by what he sees. It doesn’t matter if you can do better, he will judge you by what you have presented to him.
My challenge to you is that whether you produce one product or a thousand; make the best of the best from number one so that if you get to the last, it would still represent the best that you are capable of doing. When you deal with one customer, do the right thing. You don’t know the “small” customer who buys a small thing today. You might think you know him because he’s a small man – tell me who knows the future of any man? The man you deal with today may turn up in 5 or 10 years time, based on your service he could come to order 5,000 or 10,000 units of what he bought from you. Your investment in people matters. The people I dealt with many years ago- doing their babies’ chairs and beds, are still around. Even when I said I was not doing any house furniture again, people thought I was crazy. In Nigeria, everybody does everything. They think you increase your chances of making more money than limiting yourself to office furniture. But I stood my ground. Sometimes you have to take a hard decision and when you take such decision, you have to stand by it. It’s not everybody who sees what you are seeing.
At a point when we started that way, every office knew we were the only one doing office furniture exclusively. We became sole office furniture experts. It could be an adventure. But it paid off. We have created something out of nothing. So I challenge you, It’s a chance to express yourself, It‘s a chance to be a game changer. It’s a chance to receive knowledge; it’s a chance to change people’s lives. It’s a chance to be other people’s employer and the families of those you employ will benefit from the wages you pay them. It’s a chance to change a nation; it’s a chance to create value for the people and organisations that will benefit from your services. It’s a beautiful thing to know that you have had the chance to know, to receive knowledge about entrepreneurship. I should not say congratulations. I welcome you to the real world. There are challenges everywhere. You must have tenacity; you must have strength of character not to cheat. Don’t run at the sight of the first problem. He who confronts challenges wins, you must learn every day-you must seek in order to find.
I’m always going to school. In year 2000, I went to Lagos Business School. I did a Chief Executive programme. After about three years, I knew there are new things to learn. Having just had a baby, I took off to Barcelona, Spain to do a MBA Global Executive programme. People thought I was crazy. They said “what do you need all these for? You are already successful. What do you need all these degrees for?” Success is left to the person interpreting. What others consider success, for you, it might be the beginning. I don’t give myself out for people to measure. I will be the one that is measuring. Every year, I must go for at least a brief course. The world is changing so rapidly and you must give yourself up to new things so that the world would not leave you behind. Knowledge rules this world. Whatever, business you go into, learn how you can do yours differently to make you stand out.
I know some of you might be thinking about money. No amount of money can keep you away from your dream if you stay focused. Because you would find a way. I’m a Christian and the Bible says we should not despise the days of humble beginning. If you start big, your problems to would be big. The best of your business plan is full of assumptions. You’ve assumed your market; you assumed your customers, you’ve assumed taste and level of reactions. You might think they would not want to buy. It’s better to test your assumptions small. There could be hiccups, but you can adjust. If you go out big, the cost is also very great and huge. Going to get huge machines, large place and if it turns out that your assumptions are not right, what happens? You can grow a business from within the business.
By the time I took my first major loan for the business, we were already at over N150million profit. Everything I did from the first job of paper tray was to plough back everything into the business until when we were going to buy our own machines. I couldn’t buy the big machines, so I looked for small fairly used machines. We started that way and started moving on. That grew the business a little. Did I buy a car? Ah, car ke? Car was the last thing on my mind. People called me all manners of names – you this Ijebu woman. I said to them, I was doing a business that was capital intensive when I had no capital. I allowed the business to grow itself. I was going out in taxis. If the car breaks down on the way, it not my business, I simply would go down and wave bye to the driver. If I had bought a car, I would pay driver, make provision for mechanic… No, I didn’t have that luxury. Don’t get carried away by the false life people live.
What I always tell people is that if you have sand and you play with it, you have sand. If you increase the sand, you still have sand. If you add more sand, you still have sand. But if you make the sand into a block, you have a block. So never you talk about your sand until you have moulded your block. Sand in this sense is your disposable income. I could buy a car every two months if I wanted to. But a car was not my priority. The business was my priority. When I decided to buy myself a car, I bought a used car. My friends were harassing me. I simply ignored them. I knew what I was doing- I kept building. The day I even went for the loan, the Executive Director of the bank that gave me simply called the branch manager nearest to him to perfect the paper. I got that N10million facility because they were chasing us. They knew we already had a high turn-over. Our leverage level keeps us attractive.
Two years ago, when I wanted to buy a 2million euro worth of machine for our factory at Ikeja here, I had approached the Bank of Industry and they had approved the facility, they now needed a bank guarantee as collateral. I went to my bank to ask for the guarantee because they already have in our account something worth more than the guarantee we were asking for. They came back to me that they cannot give me a bank guarantee. I said “Am I such a bad customer?” They said on the contrary, it’s because I’m sure a good customer that they cannot give me out to another bank. I said BoI is a developmental bank and they charge less than you commercial banks. They then made a proposal that they were willing to give me for five years for the value of what I was going to pay in the developmental bank. That’s exactly what happened. I never had of a commercial bank giving a five year loan before. They added the cost associated with the guarantee and gave me for five whole years.
I told you the story of how I started small. The first brand new car I used was a gift from my husband. I had got so used to not wasting my money or indulging in any ostentatious thing that pulling out N9m or N10 million naira to buy a car was big deal. He knew I wanted a car but because each time we talked about the car, I will say “for what?” It was for the price that I didn’t want to buy. I could afford to buy. But I advise you not to eat up your profit. The day you go out for money, they look at the papers. Open an account for every penny that comes through your business. Don’t think about the COT. It will cost you more if you don’t keep your money in a financial institution.
There’s a whole world waiting for you. I never wished to be a Beninoise, Togolese or Ghanaian or South African. Tell me how many countries have a population of 150 million? That’s what they call market. It’s not only the 150 million Nigerians; you are looking at the whole of West Africa. That gives you like 280 million. These smaller countries have less than the size of Nigeria; just add them to what you have. They don’t have your production capacity either. Go out there and conquer the world.
Source: www.africaleadership.org
Photo credit: ibukunawosika.org
