What progress have you made in promoting Enyo as a retail and lifestyle company?
ABAYOMI AWOBOKUN We are on track to achieve our target market share. We wanted to close 2019 at 2% of the national demand, and we are already close to that figure. We have expanded our footprint to about 14 states in Nigeria. We are now distributing competitively in Lagos, where we have 25 active retail stores; only one or two of the majors are bigger than us in Lagos. We have also expanded into four states in the east and consolidated our presence in the north. We are fast becoming a national brand, getting great customer feedback. From a lifestyle perspective, we have also made excellent strides. We have partnered with a technology company and opened in Lagos, the first STEM center for kids. We have also partnered with a car retailer and are rolling out a new range of products that allows the company to trade in its cars and quickly monetize their assets. We have positioned ourselves as a lifestyle brand. Globally, companies in our space have tried to have convenience stores for the same reason. We are driving profits and improving perception, and we are super creative with the brands we partner with.
What opportunities do you see in the industry?
SANJAY TEOTIA We have grown in terms of infrastructure. Volumes have gone up, and business has increased with it, which is evident from our balance sheet. Unfortunately, margins have shrunk. We have managed to work out a good agreement with our creditors, although depots have closed because they cannot afford to repay their loans. One of the products we sell is Premium Motor Spirit (PMS), which is the fuel of choice for Nigerians and price of which is regulated by the government. We used to be able to import it and sell it, but now the only way to buy it is through the NNPC, which has increased the price in recent years. At present, we buy it at NGN117 (USD0.32) and sell it at NGN145 (USD0.40); however, we also incur other costs, such as those related to logistics and ports. Ultimately, the cost comes to almost NGN133.28 (USD0.37), which means we are not generating a lot of profit. As a counter measure, we have increased our efforts toward decontrolled products, such as gas oil and LPG. In order to survive, we have had to expand our footprint in the LPG market. We expanded across our storage capacities.
Does having partnerships with different brands detract from your main goal of growing brand awareness around Enyo?
AA The Enyo brand is getting stronger by the day. We gained market share as Enyo before we started to push VehiCon. According to our research, the brand enjoys certain perceptions, and one of them is trust. We have leveraged this trust to push our vehicle maintenance brand. Consumers demand anything associated with the Enyo brand to provide a certain level of quality. When we create our lifestyle brands, we are constantly considering which partners are required in order to reinforce the strongest brand perception in the market. Apart from that, our mission is to leverage available expertise to grab market share. There are some things that we do not have expertise in, and in that case, we have to leverage brands partnerships with firms that really know what they are doing. This is especially key when we have common values with the brand. One of those key values is trust.
What measures should the government make a priority?
ST Today, if we have to buy regulated product like PMS, then the Central Bank of Nigeria (CBN) does not subsidize forex. That means we have to go to the open market to buy forex. If the CBN can afford to support us in forex, that will level the playing field. Second, it is fine to regulate a product since the federal government knows its budget and its affordability, and it wants to see prices regulated based on that. However, the template it kick started this entire process of benchmarking prices with should not be distorted. When one sets up a certain regime, they have to also ensure all the rules stay the same for everyone and that they are in line with what is envisioned. We work with narrow margins. The government needs to help those who have actually invested money in the sector.