Two African giants in mattress manufacturing, Mouka of Nigeria and Bravo Pty of South Africa, have formed a Joint Venture (JV) company, Belimi Limited, aimed at deepening and fully exploiting Nigeria’s formal mattress market.
Nigeria’s mattress market is estimated at N120 billion by industry analysts.
With fears of the first recession in South Africa since 2009, after the recent 0.6 percent contraction in first-quarter GDP, and purchase of furniture and mattresses declining in that country, Bravo Pty has been planning expansion moves and this Nigerian opportunity is considered a soft landing for the company.
Nigeria’s steady economic growth, high return on investment and large population have become alluring to foreign investors in recent times.
Greg Boulle, CEO of Bravo, told BusinessDay last weekend that the joint venture with Mouka was significant to Bravo as it would enable the firm achieve its growth target, adding, “We are commited to the joint venture.”
He regretted that imports of furniture into South Africa had increased significantly over last 10 years, saying they had “brought a number of initiatives to remain competitive in the local market”.
According to Boulle, the problem in South Afrcia was that the percentage of houseshold expenditure had decreased over time, from about 2 percent to 1 percent of disposable income. This means people are spending less of their disposable incomes on furniture but more on cell phones, medicals, transport and education.
The new joint venture company, Belimi, has hit the ground running, with the unveiling of two flagship galleries in Lagos featuring a range of Sealy posturepedic mattresses to cater for the discerning consumer.
The introduction of the Sealy brand of mattresses is also informed by the growing middle class in Nigeria. Analysts say Nigeria’s demography of over 160 million people and the fact that insecurity is limited to the north of the country give investors more room to explore the promising business environment.
Peju Adebajo, CEO of Mouka Limied, said the joint venture would further strengthen the Mouka brand as Mouka would have access to alternative technologies and a complementary product range offering which would expand its market.
The introduction of Sealy, a world-renowned luxury mattress with huge history and heritage, was to ensure that Nigerians slept well and stayed healthy enough for economic activity, Adebajo said. According to him, while medical practitioners advise eight hours of sleep a day, they were also agreed that the quality, not quantity, of sleep was more important to achieving a deep and restful sleep.
“As the world leader in the science of sleep, Sealy works with the world’s finest doctors and orthopedic surgeons in the design process,” he said.
Femi Fapohunda, head of supply chain, Mouka, tells BusinessDay that Mouka recognises that the future of Nigeria rests on the ability of firms to partner across borders to build on an environment that promotes growth and development and ultimate benefit to the people of Nigeria.
“We fully understand that promoting cross-border collaboration is an important strategy to achieving our goals in economic development as we strive to support local content,” he says, adding that Belimi would be rolling out more Sealy Gallery stores across Nigeria, which would be followed by a manufacturing facility for Sealy mattresses in Nigeria.
Sealy is a USA company formed in 1881 and dedicated to research of beddings and manufacturing.
Daniel Obi
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