In barely two years of operation, Matta, a tech-enabled marketplace for chemicals, raw materials, ingredients and commodities, has impacted Africa’s manufacturing space with its unique B2B platform and innovative services that offer seamless business operations. In this interview, Mudiaga Mowoe, founder and CEO, Matta, unveils to OBINNA EMELIKE, the rationale for the platform, impact so far, untapped raw materials in the country, challenges of exporting to abroad and need to focus on Africa, suppliers and buyers, expansion plans, among other related issues. Excerpts:
Can you tell a little about yourself and your company?
My name is Mudiaga Mowoe. I am the CEO of Matta. I have been in the chemical space for over a decade. I started my experience in the chemical space working for a company called Ferro in South Africa. They moved me back to Nigeria to be the head of sales and administration of the country.
So, starting with Ferro, I built my capacity in the chemical space over time and then ended up partnering with a friend of mine to start a company called Momentum Chemicals.
After that, we started Matta. Starting Matta was basically as an offshoot of the problems that I saw when I was working with Ferro.
So, working with Ferro, one of the things that became very apparent to us was the fact that in Nigeria, you have lots of demand for chemicals and raw materials.
People say that there is no manufacturing in Nigeria. It is not true. There is a lot of heavy manufacturing happening in Nigeria, we just don’t know about it. I have been to many factories across the country to confirm this.
Ferro was a company that focused on the manufacture of chemicals and raw materials for various industries. So, we had clients who will come to us and say, look we are looking for this chemical or raw material and we can’t find it. We tell them that we don’t sell it, but they request that we should find it for them.
After a while, half of the calls primarily came from clients who were looking for chemicals and raw materials that we don’t have.
That was the first time the idea struck me that there is problem in sourcing the chemicals and raw materials and there is no transparency in the value chain.
In addition to that problem was the fact that many of the people who will buy from us will request that we organise trucks for them.
Initially, the idea was the fact that people can’t find the chemicals and raw materials they require, let us set a database of various chemical distributors and the chemicals they have so that everyone can go there, see what they have and buy.
But you know as we are in Nigeria, things are really hard and people want things to be made as easy as possible. During that period, I did not have time to sit down and focus on that idea. But when covid happened, I then had time to sit down and flesh out the idea to imagine what the best solution would look like. Then I concluded that the best idea is to set up a platform where people can find all the chemicals and raw materials they want.
We have to make the platform transactional so that the people can make purchases on the platform. Then, we put things like logistics and financing in place to enable them not only to find and buy the chemicals and raw materials they are looking for, but also to deliver them to their doorsteps. That was how the idea of Matta was born. So, I fleshed out the idea in 2020, but we started in 2022.
How has the journey been?
The journey has been good; God has been merciful to us. We have been able to create partnerships with the people we work with, not just the suppliers, the merchants also.
When we started, most of our suppliers will ask why we think they need us because they can reach anybody they want. I will respond, fine, but do you have information of things in the market, do you know this client, this place and so on. These are the unique services we are bringing to the table, which also differentiate us.
Then, they begin to realise that the kind of solution we are bringing will be quite advantageous to them.
We have had very big suppliers who will come to us and say, look we have this big product in our warehouse in the last six months, can you put it on your platform and do a campaign. We will do that and in 48 hours everything is gone. We have had this kind of experience before and as time goes on they begin to see the benefits.
Then, you also create discovery for the manufacturers because unlike before where they don’t know where to get their products, they can come to the platform and they can basically see a range of products chemicals and raw materials that we supply.
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How do would-be-clients access the platform?
It is very easy. We have created videos that will help people to understand how the platform can be used. Apart from the platform, we have WhatsApp channels, and we can always be reached on WhatsApp. We have a team of dedicated staff that focuses on the distribution and supply aspects.
For us, the goal is to take people from what they have been doing to a place where they can operate more efficiently.
Everybody will not wake up and start using the platform, they will start from somewhere and we will start with them from where they want to start from and gradually move them to where it will be easier for them to navigate.
What are the products on the platform and major chemicals on offer?
We have mainly chemicals, raw materials, ingredients and commodities.
For the chemicals, the sectors we have been focusing on so far are food and beverage, home and personal care.
How do you get suppliers and buyers on the platform?
That is where your team becomes very important. We have an amazing team that focuses on supplies and merchants. The truth of that matter is that because people don’t know where to go, once they realise there is a solution, they will come. So, the merchants will always come because they are looking for something.
We have a team of people who understands the market. So, you already know what people are likely to be looking for in the market. Based on that, we know what to put on the platform and if we get a request of something that is not on the platform, we will go and look for it and get a supplier who can put it on the platform.
What do you do when suppliers disappoint?
We don’t have one supplier for the products that we have. We also don’t just have local suppliers, we have both local and suppliers outside the country. So, we work across that spectrum of suppliers. For any one product, we have many suppliers out there to source the product because our goal is to ensure that our manufacturers always have raw materials they require as at when they need it.
Do you have foreign suppliers?
The way we work with our suppliers that come into Nigeria for the first time is to represent them here because they usually don’t want to come into Nigeria for various reasons.
So, we offer them a representation term and we become their Nigerian branch. We create a digital presence for them and we become their representative in Nigeria. So, from the sourcing of merchants for them, either through digital channels, marketing or going out to source, we do all that and make it easy for people to make purchases from them.
What about certification of the products?
The most important thing is compliance. We have a whole department that focuses on compliance and legal matters.
Before we started, we went to NAFDAC and explained to them what we want to do and asked after the kind of licences we need. They told us, this and this are what you need.
So, from a licencing perspective for what we do, we are covered.
Are there situations where you import products local suppliers have?
We don’t compete with suppliers. A supplier usually has a level of the market that he sells. With many local suppliers, the client is serviced and they don’t always service the same level of supplies that foreign suppliers service.
We have instances where the local suppliers say, we see that you do this and this and this. In fact, I will give you a very good example. There are products that we import from outside the country from one of the industries that we service.
One of the local manufacturers to come to us and said, we see that you supply these raw materials and chemicals, can you do a campaign for our own products, for our partner or partner to push our products on the platform?
And we said yes and we are currently working on that campaign right now. So, it is never a battle. Think of it like Jumia. That is exactly what it is like; everybody sells.
We have various people selling the same thing on Jumia, but everybody has their target market. Our goal is to create visibility for you.
If it is necessary, create a logistic advantage so that we can remove the goods from your warehouse to wherever the merchant is.
If you need financing, we speak to one of our credit service providers and ask them to provide you with one.
Do you import also?
Yes, we do.
How is foreign exchange challenge impacting the business?
Thankfully, many of the suppliers that we work with give us lines and the merchants we work with, to a large extent for importation. They assure that if you are going to import this product for us, this is the up payment that we are going to give you.
But if the exchange moves, the Naira amount you are going to pay us will be different, and they understand that.
Sometimes it is a bit difficult because they don’t want to play in that manner and what we have done is to hedge our risk a little bit, especially for the guys we import for and make sure that we don’t come at a loss when the goods get to Nigeria.
But because I have been in this space for almost a decade, there is almost no level of volatility that will stop us. Of course, 2016 was a very terrible year, exchange rate went from N200 to $1 to N500 to $1 in one day, yet we weathered the storm.
So, we take that experience in maneuvering the intricacies of our business for our clients.
Are you considering manufacturing some of these chemicals tomorrow?
If we start manufacturing, it means we are competing with our clients. The foundation of every economy is manufacturing and it does not matter how you look at it.
One of the biggest problems Africa has had so far is that we have not adequately developed our manufacturing sector.
Also, because of the underdeveloped manufacturing sector, we have seasons of scarcity of raw materials and products because we rely on importation.
The scarcity comes from the fact that we don’t have data, so you have no idea of what the market requires.
Our goal is not so much to go into manufacturing but to facilitate it.
If we have enough products on our platform, then we will have data to drive investments into specific manufacturing areas.
We have had such experience. There was a chemicals we supplied to our client and the manufacturer came and said we want to set up a plant to make this here based on the market data we have, this is the volume of product that moves in Nigeria per month and when we saw it, we laughed because we have a client that takes that volume every two weeks.
So, we are not going into manufacturing but we will facilitate investments in manufacturing through collaboration and partnerships, providing data and speaking to investors.
What is the secret of your fast expansion across Africa?
It is simply because of the nature of our space and once you understand the demand factors within these countries, it becomes very easy to know what the country needs.
Remember we already have access to a lot of suppliers, so when we go to a new country and we understand these are the chemicals and raw materials they need. We can say, look we can ensure availability of these products because we have the suppliers and we begin to trade in that country and it makes it easy.
We don’t always have to set up a full-fledged office, we can work with partners, we just need the right partners and we begin to facilitate transactions in these countries. Mauritius, is purely financial centre and not a transactional centre.
Is there a plan to further your expansion in Africa?
Right now, we are looking at solidify our position in South Africa, spread into the region and maybe, East Africa will be the next.
Are there products you export to other countries?
You will be amazed at the number of products as you travel you see that there is demand for. But people are not aware that Nigeria has these products; it is unbelievable.
When I come back from such trips and I tell my team members can you believe that I was here and they said they need this and they bring it from Europe and my team members will be sad because it is something we have here.
What I believe is that in the next few years, the export space in Nigeria is going to be very massive because all of a sudden there is an awareness of the fact that we have so many chemicals and raw materials that we can send from our country to people who need it, who don’t even know that we have it.
How do you assure that quality of export products meets international standards?
I think, a lot of those issues are with organic products. But there are dry products you can export that will not be susceptible to spoilage over a period of time.
With that being said, everybody is focusing on exporting to Europe, but we have neighbours who require these products.
Europe will say our products are not up to their standard, but what is the benchmark for saying that. You cannot just make a blanket statement. I feel like everything that should be exported on its own merits. So, you have countries in Africa that will take these products because they don’t have them. They will want to bring it from Europe, but it is much expensive for them.
Have you made effort to move the platform from B2B to physical one?
We have attended conferences and we are working on a number of things down the line. We are trying to work with a couple of partners to see if we can participate in bigger capacity. The most recent conference we attended was the Mining Indaba in South Africa. I had conversations with some people from Australia and Canada at Mining Indaba and they said that people don’t look to Europe, Australia or North America for the source of their raw materials again. They are looking to Africa because taking the products from here is easier because of the bureaucracy around where they are.
It is just a matter of time, there will be a ridiculous boom in export from Africa.
What would you say has been your major challenge?
I think the biggest challenge for us has been when it comes to export. There is a lot of bureaucracy around export, depending on where you are exporting to. And so sometimes it can be quite difficult dealing with the ports, even on the import side as well. I think that is the most challenging part of what we do. But other than that, I think we do our best. And I think at the end of the day, our goal is to make sure that African countries understand the fact that what they require, they can get from other African countries. Now, this might seem like something that people say, but if you travel around Africa with the aim to see what each country has, you will be amazed at the number of things one country has that another country needs. But because they don’t know, they are buying from Europe, which we see all the time.
