Michael Shobukola is the Group Managing Director and Chief Executive Officer of Strongmas Group. In this interview with BusinessDay, he spoke about the Nigerian business environment and how the country can respond to its current brain-drain exodus.
Please give us an insight into Strongmas Group and what you do
Strongmas group comprises of Strongmas Residence & Development Limited and Strongmas Automobile Limited. A company with keen interest in the automobile and real estate sectors of the economy. We are renowned for commitment to customer satisfaction and provision of high-quality products and services.
Our automobile division was established in the year 2015 with ultra-modern equipment’s and has since evolved into a state-of-the -art automobile dealership with wide range of auto services including sales of vehicles, after sales workshop services and sales of spare parts with focus on multiple brand divisions (European, Japanese, and Korean).
Strongmas Automobile Limited is fully incorporated and certified by CAC, Federal Board of Inland Revenue and Nigeria Custom Service and has established relationships of trust and confidence with its loyal customers and partners over the years.
Our real estate division – Strongmas Residence & Development Limited was incorporated in the year 2020 borne out of the lacuna created by our partnership with some estate development companies as regards quality and project delivery timeline.
At Strongmas Residence & Development, we recognize that one of the most important attributes that makes for a successful project is communication. Hence, we listen to what our customers tell us about their lifestyle, their vision, and their concerns about building a new home. At the end of the project, we would have designed a quality edifice customized to your unique needs, dreams, and specifications.
Over the years, we have successfully delivered projects and currently have several ongoing projects including the fast-selling OMINI project in Lekki phase 1 and our recently SOLD-OUT project Strongmas Residence, units of four-bedroom luxury terrace duplexes also in Lekki Phase 1. We have brought innovative ideas and new strategies to the real estate industry in terms of quality home building and Strongmas is fast becoming an household name.
It’s been a glorious journey for us so far and we are proud of the positive impacts, influence, relationships, and the niche we’ve established with our partners.
Looking at the state of the economy, what are your major business concerns and priorities going forward?
The acute foreign exchange scarcity, rising inflation rate and insecurity upsurge across the country vis-à-vis year 2023 election uncertainties has been a major concern for most businesses in the country.
However, amidst these narratives, Strongmas group has continued to stay afloat against all odds via upholding integrity, quality, and customer satisfaction values in all we do.
For instance, our priorities at – Strongmas Automobile Limited going forward is to deliver value in line with selling more quality vehicles (European, Japanese & Korean brands) to individual income earners, corporate organizations, and government parastatals leveraging on partnership with banks for flexible payment plans where necessary. Also, our robust aftersales workshop services have been positioned to reduce vehicle maintenance/repair cost with a 50% discount plan for all vehicle/fleet owners whenever they visit our ultra-modern workshop. For us, the replacement cost of vehicles is high due to instability in FX and auto policies; hence one of our major priorities is to support vehicle owners to prolong the lifespan of their existing vehicles via ensuring consistent maintenance culture at an affordable rate with assured quality service.
Our real estate division – Strongmas Residence & Development Limited has also prioritized the utilization of positive feedbacks and referrals from existing clients which has continued to spur us into starting new quality projects.
On top of our priority list is making sure that we provide the finest development for our clients while considering their peculiar requirements for a high-quality, distinguished, and luxurious lifestyle. We have never lowered our standards, and we don’t have any plans to do so in the future regardless of the prevailing economic challenges. For us, ‘’quality is what remains long after price is forgotten’’.
What do you consider to be the biggest challenge of leading a Nigerian business or organization?
Access to finance has proven to be one of the major challenges faced by most businesses in Nigeria as you will find that there are several intelligent business owners with innovative ideas but are still struggling to access the finance needed to kick start or scale their businesses to the next level.
At Strongmas group, we see finance as the fuel that propels every business, and in its absence, startups with wonderful ideas risk failure or stagnation and the same applies to existing businesses requiring funds to scale up.
To stand a chance, it is imperative for business owners to master the art of raising funds for their businesses by following our model, which is achievable by developing business integrity, relationship integrity, bankable business plans, efficient business model, standard operation procedures, business track records, effective governance/leadership structure, and capital structure which are the basic prerequisite that demonstrates creditworthiness for attracting investors and banks.
What is your projected outlook for business over the next 18 months (H2 2022 and FY 2023) in your key business segments?
In 18 months, Strongmas Residence & Development Limited would have completed and sold out on its ongoing world class project – The OMINI which is 18 units of luxurious apartments in Lekki Phase 1 as we are bringing together exclusivity, prime location, smart/luxury home features and quality styling for the vital few among the upper social class who has keen attention for details and luxury living.
In addition, we also have two other ongoing quality projects which are projected for completion and will be sold out within the next 18 months as we take stipulated delivery timeline and quality building very seriously in line with achieving customer satisfaction. This has been our competitive edge.
Our automobile division have also strategically positioned sales activities and put systems in place to take advantage of the year 2023 election period for sale of brand-new operation vehicles to political parties for election logistics and the aftersales workshop services have also been structured to on board over 5000 vehicles (Mercedes Benz, Range Rover, Japanese/Korean brands) within the next 18 months for consistent maintenance and repair plan under the Strongmas Fleet Discount Club which offers several bumper packages including 50% discount on all workshop services (Electrical, Mechanical, AC or Paint/Body repair jobs)
Nigeria is haemorrhaging talents across sectors, what do you consider the appropriate response to brain drain from the organizational and state policy perspective?
The loss of human capital assets, lost income from the loss of tax of the migrated manpower to foreign countries and the loss of capital invested in the subsidized public education of migrated manpower is largely because of the economic uncertainties and security concerns besieging the country at the moment. Unfortunately, this situation has continued to stand as major concerns for most organizations and the government today.
Focusing on the advantages of the brain drain situation, it is imperative to advise and reassure those of us who are still in the country that increasing opportunities abound for us provided we can strategically skill up and position ourselves to fill the available voids left behind by those leaving and offer greater service towards rebuilding the nation.
At Strongmas Group, we place immense value on our employees and this cuts across adequate remuneration, incentives, motivations etc and we advise other organizations to do the same towards cutting down on brain drain and it is also high time we start positioning our indigenous businesses for globalization in line with attracting skilled manpower from other countries as well.
In general, as a nation we shall continue to look forward to a stable economy, improvement in security and better government policies after the year 2023 election which will positively impact on the brain drain situation.
It’s been two years since the biggest pandemic of our century, what are your organization’s post-COVID recovery path and strategies in place against such an occurrence in the future?
The Covid pandemic favored our operations, for instance during the post covid period, our real estate division – Strongmas Residence & Development Limited successfully launched, completed, and sold out units of 4bedroom luxury terrace duplexes in Lekki Phase 1 and immediately started two other projects concurrently with major focus on meeting client expectations for quality delivery and achievement of set delivery timeline. This was possible because we were able to recognize that smart investors were actively in the market shopping at the time with the understanding that value of prime properties will rise after the COVID pandemic is long forgotten.
Our Automobile division – Strongmas Automobile Limited also restructured her aftersales workshop services during the post COVID period and this later led to the expansion of our ultra-modern workshop and thus presented us with capacity to accommodate increasing aftersales opportunities.
What have been your greatest challenges doing automobile and real estate businesses in Nigeria, and what are the possible solutions?
This period is indeed one of the most challenging times for the Nigeria automotive industry. A lot of automobile companies have closed shop, while a large number need life support, and more are strategically leveraging on the aftersales wing of the industry to stay afloat.
The COVID-19 outbreak, current economic downturn, instability in FX and the auto policy/the Finance Act 2020 which introduced a lot of taxes created tension for industry players and our consumers who are already battling with inflation and reduced purchasing power.
The automotive industry plays an important role in national development and the role of government in supporting us to rescue the industry with policy review and effective regulations cannot be overemphasized as the industry maintains the capacity to generate massive employment, wealth creation for the country and foreign exchange savings.
In the real estate sector, our national insecurity challenge is a major concern for industry players as these poses limitations in attracting foreign investors, however, for us at – Strongmas Residence & Development Limited, we strongly believe that with corporate business integrity and quality developments that assures customer satisfaction without cutting corners, real estate developers can stay afloat in attracting investors.
How much have you embraced technology? What role do you see technology playing in your sector and what disruptions do you envisage especially via-a-vis the growing emergence of blockchain technology in the automobile and real estate sector?
Technology plays a pivotal role in the automobile industry from revolutionizing the driving experience and influencing the innovation on low-fuel-emission vehicles to diagnosing faults in new-generation vehicles via the usage of sophisticated diagnosis devices.
For instance, Strongmas Automobile Limited has already envisaged technology to cause a major industry disruption in the future due to the emergence of new-generation smart vehicles hence we have installed future-ready gadgets with sophisticated diagnosis tools and have employed modern-day technical capacity in our ultra-modern workshop.
We understand that electric and autonomous vehicles vis-à-vis blockchain technology are emerging trends promising to transform the automotive industry and transportation sector and we at Strongmas Automobile Limited are already awaiting this paradigm shift as we know that the shift will introduce its own challenges and opportunities for smart industry players to take advantage.
Technology is also essential for business growth in the real estate industry and at Strongmas Residence & Development Limited, we don’t only use technology to connect with investors via social media, but all our projects are also technology inclined with advanced automations installed to create smarter homes for our valued investors.
How have government policies impacted your business?
As earlier mentioned, government policies, current state of the economy and insecurity upsurge in the country has affected many businesses and investors. However, we are presently at a critical decision-making period in the history of our great country with the 2023 general election approaching, and we look forward to better government policies, enabling and safer environment for businesses to thrive.
In recent years, the real estate and automobile sector has experienced rapid growth and the entrance of numerous players operating at various market tiers and levels. What makes Strongmas Group unique in this vast market?
At Strongmas Group, we believe that keen industry competition is healthy for the economy and business growth. For our real estate division – Strongmas Residence & Development Limited, we derive a deep sense of satisfaction from the numerous feedbacks and referrals received from our existing clients and investors which centers around our exquisite architectural designs, high-quality finishing, high attention to details, high-level smart homes and our ability to deliver quality projects within stipulated delivery timeline. We strongly believe that professionalism to deliver quality projects coupled with business integrity means a lot to most investors and the act of delivering high-quality projects at competitive prices without comprising standards and delivering these projects at the stipulated timeline has made us stand out amongst competition and we are currently positioned to dominate the market for a takeover.
Also, at Strongmas Automobile Limited, our recently launched Strongmas Fleet Discount Club offers several bumper packages including 50% discount on all workshop services (Electrical, Mechanical, AC & Paint/Body repair jobs). This is a flawless competitive advantage for us alongside our quality service delivery.
As a key player in the Automobile and Real Estate sectors, what do we need to do to unlock more access in the mortgage sector?
With a housing deficit running into tens of millions, many Nigerians face the challenge of buying or building their homes, as only a few have the financial power to do so and the prevailing high mortgage rate at 16%-19% is also not affordable for many vis-à-vis present-day economic challenges. Hence, to unlock more access in the mortgage sector, the government will need to put up workable policies and regulations with active involvement of the private sector via considering mortgage subsidies for low-income earners. Also, a downward review of the mortgage rate to a single digit should be explored vis-à-vis the high housing deficit in Nigeria and systems must be put in place to effectively monitor mortgage loans while ensuring that loans are used specifically for housing projects.
The same applies to car loan in the automobile industry as not many Nigerians can afford their dream cars at high interest rates between 17 to 30%. However, we are hopeful that after the 2023 general elections, normalcy will be restored to the economy and the government will introduce business-friendly policies that will make it easier for citizens to own their dream houses and buy their dream cars.
