In July, the Global Ukrainian Distribution, Investment & Trading Project (G.U.D.I.T.) was officially launched. This is a platform that allows Ukrainian private and state companies to present their goods and services to African countries, and, in turn, to African business to present its investment and trading opportunities.
Infagro: Generally, how does the approach to financial participation look for Ukrainian partners taking into account the possibility of joint consignments made by several manufacturers?
The project is most interesting for small and medium-sized businesses. That is, companies that produce value-added products and cannot pay excessive marketing bonuses in Ukrainian retail networks, but have certain capacities for supply and want to increase production volumes.
The cost of participation is individual. It depends on the type of goods, the number of commodity items, the monthly volume. Participants cover only a part of monthly expenses, for our part we take on the rest of the costs, as well as customs clearance and other costs.
I would like to note that we are not interested in the “inflated” assortment portfolio, which will simply lie in the warehouse. In any case, the cost of participation in terms of SKU for the project partners will be significantly lower than the listing and marketing bonus in Ukrainian trade networks.
Infagro: Does the project have the opportunity to provide the marketing support for the product when entering the market of a certain country, for example, Tanzania?
Yes, there is such an opportunity. But I would like to mention that marketing support is a two-way process, therefore the manufacturer should also be very interested in this and actively participate. In general, we advise project participants on the requirements of the current legislation of Tanzania and Tanzanian consumers’ preferences.
Infagro: Does your Project provide preliminary information on the target market so that the partner can assess the feasibility of efforts and costs of participation?
We can provide the data on the market volume of Tanzania and 7 neighboring countries. But let us keep in mind that for some products the market simply does not exist, or it has not been shaped yet.
In emerging markets, the manufacturing company can, with our help, generate the demand for its products. I will give an example from non-dairy field: for example, frozen berries could well be in demand. Their average cost in supermarkets is 30 USD/kg, but this is a risky product. We can create conditions for the manufacturer with acceptable financial risks and optimal load so that we can explore the market in a practical way.
Africans have a very limited choice of goods on the shelves. The mechanism of work in Tanzania does not motivate supermarkets to experiment. We want to give an opportunity for Ukrainian producers to explore this market without high overheads.
Without moving forward and experimenting it is impossible to develop.