Woman Restaurant Entrepreneur Embraces Brand-Driven Growth

 

The journey of Zhang Lan is the tale of an entrepreneur who exemplifies the story of globalization. She has gone from working many part-time jobs while studying overseas, to becoming one of China’s most successful food entrepreneurs.

Starting with a very small and humble restaurant specializing in spicy food from China’s Sichuan province, Zhang has cannily used branding innovation to grow her business and build her reputation in the food trade. Today the company she started, South Beauty Group (southbeauty.com), has 71 restaurants, most in major cities such as Beijing and Shanghai.

A series of bold moves focused on raising the profile of her restaurants and the South Beauty Group has paid off: the group was singled out by the China Hotel Association as one of the top 10 Chinese restaurant brands. By riding the country’s breakneck growth and urbanization, her restaurant group has enjoyed double-digit growth in recent years in revenue and profits.

Zhang’s mission is to revitalize the Chinese restaurant scene by introducing a more upscale and consistent dining experience.

China’s restaurant industry is booming and represents a significant opportunity: it is said it will have revenue of 3.7 trillion yuan (US $590 billion) by 2015 (China Daily).

“Most people in China don’t know how to present food. I am happy that I have given some importance to the appearance of food,” Zhang told the China Daily newspaper.

“I strike a balance between popular and high-end brands in my daily life. This also works for South Beauty Group, which aims to attract customers to a modern place to enjoy high-grade and popular Chinese cuisine.”

Her business mission is to take the group outside of China and become a global brand.

“Buoyed by the booming domestic high-end catering market, South Beauty Group is looking to be a major luxury brand in the global catering industry. It is not an easy task considering that there are different cultures and eating habits. But my past experience has taught me that opportunities often come along with challenges,” she told China Daily.

Zhang’s business story started in a journey to Canada to pursue further education. To make ends meet, at one time she took on six part-time jobs, including washing dishes and food preparation.

Anybody who has gone to another country to work and better their life knows how hard this can be: “During that period, I was so tired by the end of the day that I had to lift my legs onto the bed with my hands,” Zhang said.

But working hard in restaurants and beauty shops earned her US $20,000 in savings within two years.

She returned to Beijing in the early 1990s, a time when the country was undergoing significant market reforms. She opened a small restaurant in Beijing in 1991 serving Sichuan cuisine. Dining out was still a new experience in a country that had spent decades under austere communism. She made her restaurant different by emphasizing cleanliness and unique flavours for the food. She even used the design of the restaurant to set it apart: she gathered bamboo from Sichuan and used it to transform the restaurant into a little bamboo house.

This attention to detail paid off. By 2000, Zhang had been successful enough to give her the confidence to open her first South Beauty Restaurant in Beijing’s China World Trade Center, a high-end office building in the Central Business District. It proved to be a great way to boost her business’s profile.

“It was a bold decision, as rents were high, but I knew the returns would also be high,” she said.

By 2006, she was successful enough to make another brave move: open a luxury restaurant called the Lan Club, in Beijing. Having learned about the importance of distinguishing herself in the ever-growing restaurant marketplace in China, she invited world-famous designer Philippe Starck (http://www.starck.com/en/) to design the restaurant.

For Zhang, there was a bigger strategy at work: “I was not disheartened when some people said that I threw money away like dirt and 12 million yuan (US $1.92 million) was too much for a design draft. But I got great publicity and brand recognition with this design, far more than what is received by most companies which spend millions of yuan on television advertisements. Not everyone in China can boast of a Starck design in their restaurant.”

In 2007, the company also started cooking meals for airlines flying between China and France, the Netherlands and South Korea. In 2008, it won the bid to be food and beverage provider for the 2008 Beijing Olympics and was named official caterer to the 2010 Shanghai World Expo.

“These international events have given us great confidence in planning overseas expansion,” Zhang said.

The hallmarks of the dining experience at a South Beauty Restaurant include dramatic food presentation, upscale décor, a pleasant dining atmosphere and critically, waiting staff who are informed about the dishes they are serving.

Dramatic food preparation includes cooking food at the table for the diners and serving stir-fried shrimp on a plate with a goldfish bowl filled with live fish.

“I want to change the cheap price and bad atmosphere tag that most Westerners have about Chinese food,” Zhang told China Daily.

She has attracted investors to take a stake in the business and become the second richest female entrepreneur in China, according to the 2011 China Restaurant Rich List.

While the international economic crisis is still damaging growth in the United States and Europe, Zhang still plans to go global. She is looking to initially expand into Asia before moving into Europe and North America.

“Our mission is to promote authentic Chinese cuisine across the world. With (the) Chinese economy growing steadily and its cultural influence gaining, it will not be long before we see some big global Chinese catering companies, much like McDonald’s,” Zhang concluded. And it looks like South Beauty Group wants to lead the way.

By David South, Development Challenges, South-South Solutions

Published: November 2012

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

Follow @SouthSouth1

Google Books: https://books.google.co.uk/books?id=D_A1VeiJWycC&dq=development+challenges+november+2012&source=gbs_navlinks_s

Slideshare: http://www.slideshare.net/DavidSouth1/development-challenges-november-2012-issue

Southern Innovator Issue 1: https://books.google.co.uk/books?id=Q1O54YSE2BgC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 2: https://books.google.co.uk/books?id=Ty0N969dcssC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 3: https://books.google.co.uk/books?id=AQNt4YmhZagC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 4: https://books.google.co.uk/books?id=9T_n2tA7l4EC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 5: https://books.google.co.uk/books?id=6ILdAgAAQBAJ&dq=southern+innovator&source=gbs_navlinks_s

This work is licensed under a
Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

Design Collaborations Revitalize Traditional Craft Techniques

Keeping alive traditional craft techniques and methods in the age of globalization is a tricky balance to get right. As countries seek to increase living standards and income, traditional craft-making methods are often jettisoned in favour of attracting manufacturing and other high-value activities – meaning rich and potentially lucrative skills can be lost.

One promising new initiative is bringing craftspeople in the global South together with established and well-known designers in The Netherlands to create the market incentives to continue using traditional techniques. It is establishing a brand and a business model to sell unique and original craft products into the European marketplace. By doing this, it hopes to open up new markets in Europe – and in time, the rest of the world – for craft makers from the global South so they can continue to earn an income using their traditional skills and techniques.

The brand is called Imperfect Design (http://www.imperfectdesign.nl/) and was founded in 2011 by Monique Thoonen, formerly the managing director of Dutch Design in Development (ddid.nl) – a matchmaker between Dutch designers, producers in developing countries and European importers. Imperfect Design takes the idea a step further: It is a brand dedicated to creating high-value, well-designed craft products for the European marketplace.

The idea began to percolate in Thoonen’s mind in 2010. She received a good response from some of the Dutch designers she approached – who were keen to work with craft workers in developing countries – and this gave her the confidence to launch Imperfect Design.

“We saw that many designers were very interested to work with craftsmen/small workshops in developing countries,” she explained, reflecting on her previous experience working with Dutch Design in Development. “The designers and the crafters learned a lot about the inspiring cooperation and it resulted often in good quality products/collections. However, it was hard to find good sales channels for the products. In 2010 the idea came about to set up an own brand.”

Thoonen was seeking a business model that could be sustainable and rewarding for all the participants along the value chain (http://en.wikipedia.org/wiki/Value_chain).

“The cooperation is inspiring for Dutch designers,” Thoonen said. “The craftsmen will learn a lot about product development during the project and will earn money from the orders. The idea is to build up long-term relations with producers in three countries in three continents – each continent one country.”

For Thoonen, the business model approach is at the core of Imperfect Design.

“The idea of my business model is not doing good. It must be a profitable business model, otherwise it can’t be sustainable. Making it profitable is a big challenge and also forces us to keep the commercial aspect every day in mind.”

The criteria for selecting the designers includes a resourcefulness and creativity that can shape a high-quality craft product with the resources and tools at hand for the collaborating craft workers in the developing country. It is also crucial they understand how to shape the craft product into a high-value item that can command a high price back in Europe.

According to Thoonen, “the products must be differentiated from the market, otherwise it can be copied easily by large producers in China. It is really important to create new things, as the prices are in general higher than from mass production, so the consumer must understand why the price is higher.”

So far, Imperfect Design has begun working with craftspeople in Vietnam and Guatemala, and it is currently selecting a country in Africa. Craft workers can contact Imperfect Design about collaborating but the number of people it can work with is limited at this stage. Imperfect Design places emphasis in taking the time to build sustainable relationships.

A common criticism of craft products sold in many markets is their sameness and sometimes poor and inconsistent production quality. Trying to enter an overseas market and understand what consumers want or desire is a very difficult thing for a craft worker to get right. This is where the experience and knowledge of a designer can make a big difference. Designers can help to hone the craft product, improve the production methods and position the product in the overseas marketplace.

“The workshops have fantastic qualities and materials to work with,” says Thoonen. “When you combine that with the strength of our Dutch designers, you can create products which are commercial, of high quality, and beautiful.”

One of the first collaborations to bear fruit is between Dutch designer Arian Brekveld (arianbrekveld.com) and craft workers in Vietnam. The collaborations have resulted in lacquer tables, trays and candlesticks, ceramic vases, iPad bags and throw cushions – all made using techniques and materials unique to Vietnam.

Imperfect Design allows the designers to select which country they would like to work with. Brekveld’s previous experience travelling widely in Asia tipped his interest towards a country in that continent. He appreciated the friendly and welcoming contacts he had made in Vietnam, who showed a strong interest in collaborating.

Brekveld wanted to bring a “designer’s eye” to the possibilities in Vietnam. He asked: “How could they make the crafts more beautiful and customized for the market in Europe?”

He found Vietnam was not just an interesting place to work, but also a country undergoing significant change. As a result, he found it critical to go and see what was happening in the country and to see first-hand the working conditions in the workshops.

This was a contrast to many of the design briefs he normally undertakes in Europe, where there often isn’t the intimacy of working directly with the craft workers in their workshops.

The time spent in Vietnam was intense and involved visiting multiple workshops to see which would be the best partner.

“We visited four or five lacquer companies to see what their skills were, looking for possibilities,” he said. “It is very special to see by yourself, to really to take a look by yourself, to see what companies do.”

Brekveld was surprised to see that concepts that had been discussed and explored earlier in the day would be presented to him as completed works by the end of the day. The quick work pace and precision really impressed the designer, and the project took months to complete in comparison to the years required by some projects he works on in Europe.

A group of women from the ethnic Catu (http://en.wikipedia.org/wiki/Co_Tu_people) community in central Vietnam weaved the fabrics for the iPad bags and cushions. It was very valuable to work with them in person because he could see what they were – and weren’t – capable of. The fabrics are made into iPad bags and cushions in the capital Hanoi by disabled craftsmen.

Brekveld said visiting the remote workshop saved a lot of time and frustration.

“It was a big difference compared to sitting behind a desk and sending designs. You really see all the possibilities that are there.”

Brekveld is seeking to design products that do not fit in with a clichéd idea of what comes from a developing country.

“If you look you can see the imperfections but they are not obvious. These designs would not necessarily sell in their own country. We try to design products showing the skills they have, using their techniques – not using patterns they would use for themselves. We look at their process and say ‘you can make that and that’. On the other hand, we don’t want to tell them to do something completely different. We look at the technique – a combination of European design language with their abilities.”

But what about quality control? Brekveld says that is an issue he looks at right from the beginning of the design process. “I am a maker, try to make myself – try to think about it before hand.”

He is ambitious for the collaboration to flourish.

“We hope these relations are long-term relations,” he said. “We hope to expand the collection.”

He will present the collections during Dutch Design Week at the end of October 2012 in Eindhoven (ddw.nl).

For Thoonen, success will bring many benefits. “If we manage to sell the collection well in the market, then we can give more orders,” Thoonen said. “In short: it will create work, but also development in quality and design.”

By David South, Development Challenges, South-South Solutions

Published: September 2012

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

Follow @SouthSouth1

Google Books: https://books.google.co.uk/books?id=QZtjxQ5L9gEC&dq=development+challenges+september+2012&source=gbs_navlinks_s

Slideshare: http://www.slideshare.net/DavidSouth1/development-challengessouthsouthsolutionsseptember2012issue

Southern Innovator Issue 1: https://books.google.co.uk/books?id=Q1O54YSE2BgC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 2: https://books.google.co.uk/books?id=Ty0N969dcssC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 3: https://books.google.co.uk/books?id=AQNt4YmhZagC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 4: https://books.google.co.uk/books?id=9T_n2tA7l4EC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 5: https://books.google.co.uk/books?id=6ILdAgAAQBAJ&dq=southern+innovator&source=gbs_navlinks_s

This work is licensed under a
Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

Rwandan Coffee Brand Boost

A successful Rwandan company is using coffee shops to promote the nation’s high-quality coffee brands at home and abroad. Started by two Rwandan entrepreneurs three years ago, Bourbon Coffee (http://www.bourboncoffeeusa.com) now has three shops in the country’s capital, Kigali, and a savvily positioned shop in Washington DC.

While Rwandan coffee has built a good international reputation, the country’s more than 500,000 coffee farmers (mostly small-scale) previously depended on the product’s reputation alone. But Bourbon Coffee joins several other initiatives changing this situation and starting to significantly raise the profile of Rwandan coffee and build the Rwanda brand.

The East African nation experienced the horrific genocide of almost 1 million people in 1994. Ever since, the country has been on a journey to reconcile with the damage done during this time and move on to a more prosperous future for all its citizens. A key part of the country’s future success will be its economic prosperity. And historically, coffee has played a critical role in Rwanda’s economy.

The Bourbon Coffee chain of shops (taking its name from the high quality Bourbon coffee varietal (http://en.wikipedia.org/wiki/List_of_coffee_varieties) which accounts for the majority of Rwandan coffee), started with its first shop in Kigali in 2007. Started by Emmanuel Murekezi and Arthur Karuletwa, two Rwandans living in the United States, it is modelled on the popular American brand Starbucks (http://www.starbucks.com). The entrepreneurs admired the coffee culture experience found at Starbucks. Just as Starbucks heavily markets its complete quality control over the coffee experience, their philosophy is to produce great coffee from “crop to cup.”

“There are over 500,000 farmers that own 100 to 200 trees in the back of their yards, so the only way they can come up with a product is to come together in a cooperative sense,” Karuletwa told the Washington Post. It is a learning experience for the Rwandan coffee farmers: they learn to work together, trust each other and be accountable to each other. “Neighbours that once killed each other and communities that once floated in the same bloodbath are now hand in hand producing one of the most amazing products.”

“If done right, it could be the platform to re-brand the country,” continued Karuletwa, a former chief executive and now a shareholder in the company. Coffee can “create awareness that there’s recovery, there’s trade, there’s investment opportunities, there’s tourism. There’s life after death.”

The importance of good design and a strong brand in the success of a business cannot be emphasised enough. That extra effort and thought can take a business from local success to regional and even global success. As consultants KPMG make clear, “For many businesses, the strength of their brands is a key driver of profitability and cash flow.” Yet the majority of small businesses fail to think about their brand values or how design will improve their product or service.

The shops have a very tasteful modern, African design and feel. African sculpture and furniture are surrounded by African artwork. The shop’s logo is an eye-catching orange and there is an overall recognizable brand identity for the entire Bourbon Coffee concept.

The founders see it as an opportunity to educate people about the health benefits of coffee culture and the joys of the lifestyle. They proudly serve only Rwandan coffee and promote the national brands they serve, including Akagera, Kivu Lake, Kizi Rift, Muhazi and Virunga.

Bourbon Coffee, in a clever move, opened the Washington branch in 2009 in a former Starbucks in a neighbourhood packed with aid organizations and NGOs, many of which work with Rwanda on projects.

Karuletwa says Bourbon Coffee’s ambitious vision “is to stand as a symbol of a new era in African economic development, one in which African nations rise to participate directly in the global marketplace.”

“Coffee is a very intimate, emotional product,” he said. “The preparation, the processes and the profiling of coffee is similar to wine.”

The Rwandan branches can be found at the Union Trade Centre (UTC) in Kigali’s city centre, the MTN centre in Nyarutarama and Kigali airport.

The business is funded by Rwandan investors Tristar (http://www.tri-starinvestments.com/index.html).

Another initiative is the Rwandan Farmers Brand (http://www.rwandanfarmers.com). It also hopes to raise the profile of Rwandan coffee and drive more of the profits made into the hands of farmers. It is a joint venture between the foundations of former U.S. President Clinton and philanthropist Sir Tom Hunter. They fund all the brand’s creation and operation in partnership with 8,700 farmers. They have started selling Rwanda Medium Roast Ground in the United Kingdom’s Sainsbury’s supermarkets. Sixteen percent of sales are clear profit and returned to the farmers via their own Trust Fund.

Karuletwa says he doesn’t want Rwandan coffee to be “a pity-driven mission”. It is all about the quality: “The value initiative here is because this coffee tastes great,” he says.

And Bourbon Coffee is looking further afield to grow the brand: “We hope to expand even further,” Murekezi told Monocle magazine. “Congo, Burundi, Tanzania, but also Europe. We think the concept can work there too.”

By David South, Development Challenges, South-South Solutions

Published: August 2010

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

Follow @SouthSouth1

Google: https://books.google.co.uk/books?id=7iWYBgAAQBAJ&dq=development+challenges+august+2010&source=gbs_navlinks_s

Slideshare: http://www.slideshare.net/DavidSouth1/development-challengessouthsouthsolutionsaugust2010issue

Southern Innovator Issue 1: https://books.google.co.uk/books?id=Q1O54YSE2BgC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 2: https://books.google.co.uk/books?id=Ty0N969dcssC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 3: https://books.google.co.uk/books?id=AQNt4YmhZagC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 4: https://books.google.co.uk/books?id=9T_n2tA7l4EC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 5: https://books.google.co.uk/books?id=6ILdAgAAQBAJ&dq=southern+innovator&source=gbs_navlinks_s

This work is licensed under a
Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

Kenyan Products a Global Success Story

The East African nation of Kenya has become synonymous with high-quality agricultural products, and offers lessons for other countries across the South. The country has been able to combine innovation in new technologies (it is a pioneer in mobile phone applications like m-banking), with quality control for its products like the Coffee Kenya Brand logo (http://www.coffeeboardkenya.org) and ease of access to information on Kenyan products and resources via the internet – crucial to drumming up international business – like the SME Toolkit Kenya (http://kenya.smetoolkit.org/kenya/en) .

There are several advantages to improving standards and productivity in agricultural products in Africa. The first is regional: greater productivity and efficiency will help in reducing malnutrition and food crises that have plagued the continent for decades. Secondly, it also allows Africa to export food to other countries with fast-growing economies and boost the continent’s wealth.

The dramatic changes taking place in African countries – especially rapid urbanization that has made the continent home to 25 of the world’s fastest growing cities (International Institute for Environment and Development) – means there is an urgent need to increase food production and stabilize rural economies to support farming.

Kenya is considered home to one of the continent’s most successful agricultural production zones, with multiple agricultural products and brands developing a solid global reputation for quality.

The country benefits from the fertile Great Rift Valley (http://en.wikipedia.org/wiki/Great_Rift_Valley) , where the country’s biggest crops – tea and coffee – are grown.

Agriculture is a key part of Kenya’s economy: 75 percent of the working population is employed in the sector. Farming sits behind tourism as the country’s second biggest contributor – 20 percent – to the gross domestic product (GDP).

Kenya has had a great deal of success with fruits, vegetables and flowers (Kenyan flowers are a mainstay of many European supermarkets). Kenya has been able to achieve this by using well the 10 percent of the country’s land that is suitable for farming.

Around Mount Kenya (http://en.wikipedia.org/wiki/Mount_Kenya) , the cool and wet climate is perfect for farming tea, coffee, flowers, vegetables, corn and sisal. Other products that have been successfully grown include sugar cane, pineapple, cashew nuts, cotton, and livestock-related products – dairy goods, meat, hides and skins.

Kenya’s main export markets are the United Kingdom, the Netherlands, Pakistan and the United States. This agricultural export success has had a knock-on effect of reinforcing a global reputation as one of Africa’s best countries for business.

In the tea market, James Finlay and Williamson have a strong reputation and sell to major supermarkets in the UK.

Another successful tea company is Kenya Tea Packers Limited (Ketepa) (http://www.ketepa.com) . A Kenyan-owned company, it enhances the standard of living of the small scale tea growers of Kenya who are the bulk of its shareholders.

Kenya is one of the world’s top 20 coffee producers and has a good reputation for its Arabica beans. Kenya produces 2 million bags of coffee a year and the coffee industry employs 6 million people (www.coffeeboardkenya.org) .

When it comes to exporting flowers (http://www.kenyan-flowers.com) , Kenya is a global powerhouse: 38 percent of the world’s exported flowers are grown there. The majority – 97 percent – are sent to the European Union. Its popular flowers include chrysanthemums, roses and carnations. This time-sensitive crop benefits from the air links of its capital, Nairobi.

Kenya even has a successful brand of beer, Tusker Lager (http://www.tuskerlager.co.uk) . It is a leading export and is proudly African, with its elephant logo and motto “My beer, my country.” It has a large market in the United Kingdom.

By David South, Development Challenges, South-South Solutions

Published: June 2010

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

Follow @SouthSouth1

Google: https://books.google.co.uk/books?id=jx6YBgAAQBAJ&dq=development+challenges+june+2010&source=gbs_navlinks_s

Slideshare: http://www.slideshare.net/DavidSouth1/development-challengessouthsouthsolutionsjune2010issue

Southern Innovator Issue 1: https://books.google.co.uk/books?id=Q1O54YSE2BgC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 2: https://books.google.co.uk/books?id=Ty0N969dcssC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 3: https://books.google.co.uk/books?id=AQNt4YmhZagC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 4: https://books.google.co.uk/books?id=9T_n2tA7l4EC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 5: https://books.google.co.uk/books?id=6ILdAgAAQBAJ&dq=southern+innovator&source=gbs_navlinks_s

This work is licensed under a
Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

West African Chocolate Success Story

A Ghanaian chocolate company has become a big success in the United Kingdom and shown how it is possible to develop and market a high-quality product grown in West Africa. While the chocolate bars are manufactured in the Netherlands, the cooperative that owns the company initiated the push into producing a mass-market chocolate brand – and shares in the profits.

The Divine chocolate brand is available in shops and supermarkets across Britain and is the product of the Kuapa Kokoo (http://www.kuapakokoo.com/) cocoa farmers cooperative. The Divine brand was launched in the U.K. in 1998 as the first Fairtrade (http://www.fairtrade.org.uk) chocolate bar aimed at the mass market. Previously, most Fairtrade chocolate was made for high-end customers.

Apart from the chocolate bars, the co-op also sells its cocoa butter to The Body Shop (http://www.thebodyshop.co.uk/_en/_gb/index.aspx), a chain of natural beauty retailers.

In 1997, at the co-op’s annual general meeting, members decided to create a mass-market chocolate bar of their own. Ambitiously, they did not want to just be a small, niche-market chocolate bar. They wanted to take on the big brands. They set up The Day Chocolate Company in 1998 and received support from a collection of international charities, aid agencies and businesses.

The Chocolate Company is structured to have two members of the co-op on its board of directors, with one out of four yearly board meetings held in Ghana. As shareholders, the farmers also receive a share of the profits of chocolate sales. Britain’s chocolate market is worth £4 billion a year (US $6 billion) and the country has hundreds of chocolate brands, making competition for customers fierce. The Divine range of chocolate has been designed to match U.K. market tastes.

Ghana has an excellent reputation for the quality of its cocoa beans and has been growing cocoa since it was first brought to the country from Equatorial Guinea in 1878 by Tetteh Quarshie (http://www.ghanaweb.com/GhanaHomePage/people/pop-up.php?ID=128).

Kuapa Kokoo’s success story has its origins in responding to the structural adjustment programmes (http://en.wikipedia.org/wiki/Structural_adjustment) which started liberalizing Ghana’s cocoa market in 1993.

The lock the government had on selling cocoa to the Cocoa Marketing Company had been lifted. Now the opportunity was there for others to sell to the Marketing Company and some farmers decided to form a cooperative, Kuapa Kokoo – “the best of the best”. They wanted to get a better price for the cocoa and to improve working conditions and lives of the pickers.

The cooperative does all the processing of the cocoa and delivers it to market. One of the great advantages for the farmers is the honest weighing of the beans – something previous buying agents would cheat doing. By creating a more efficient and fair process, greater savings are made on the price paid for the beans and this is passed on to the co-op’s members.

The farmers are also trained to do tasks like weighing and bagging the cocoa, removing the need for outside help. Every year the farmers receive cash bonuses based on the co-op’s profits and any efficiencies made.

With this success, Kuapa Kokoo grew and now has more than 40,000 members spread over 1,300 villages.

The co-op offers various services to the farmers including a credit union to help with finances. There are also 33 Research and Development Officers employed by the co-op to oversee training and election.

The number of women farmers has grown over the years, from 13 percent to 30 percent.

Extra income-generating skills are encouraged for the women farmers as well. One project is to make soap from the potash produced from burnt cocoa husks. Women have also been given machines to crack palm kernels for cooking oil.

Comfort Kumeah, a 62-year-old co-op farmer, lives in the village of Mim in the Ashanti region. A former teacher for 39 years, she inherited 20 acres of land from her husband’s family.

“Each farmer has a passbook to record weight and payment. In the whole of Ghana, only Kuapa Kokoo … is certified Fairtrade,” she told the Sunday Times.

“I was voted chair of the farmers’ trust and national secretary for the union; once a year I attend a conference to vote on how the Fairtrade premium is spent. Last year we bought a palm-nut crusher and we sell the red oil on the market.”

“Before, I was always cheated. Purchasing clerks would come and weigh the beans and you never knew if their scales were correct, as no one checked them. Some embezzled the money instead of paying it to the farmers.”

“Owning this company has given cocoa farmers a voice for the first time.”

Kuapa Kokoo sells around 1,000 tonnes of cocoa every year to the European Fairtrade market (http://www.etfam.com/index2.php). This has many advantages for sellers if they meet certain conditions. These conditions include health and safety requirements and democratic decision making. If they are met, the producers receive a guaranteed price for their goods and long-term trading contracts. This means a stable price despite market fluctuations. With a stable price, it is easier to plan and save money.

Ghanaian cocoa has a good international reputation and trades at a higher price because of this. Cocoa once made up 66 percent of Ghana’s foreign exchange, but is now down to 35-40 percent as the economy has diversified into areas like information technology.

Cocoa is usually grown on small family farms in Ghana. Farmers also grow crops like plantain to provide food for the family. Around 1.6 million people are involved in growing cocoa and its business in Ghana. Cocoa trees grow to 15 metres in height and take three to four years to start producing a crop. An entire year’s worth of a tree’s crop can make three large chocolate bars.

A tree can produce two crops a year. Each cocoa pod produces around 40 seeds.

“A cocoa farmer’s life is hard,” admits Comfort. “In the lean season, we have no income. Also, cocoa is controlled by climate. Drought followed by too much rain causes fungus and rot, and then every farmer is poor.”

“I have saved money for my children’s education but my own needs are few: clothes, soap and toothpaste. Generally, you know, women are strong. Last year more women than men were voted onto the Kuapa Kokoo national executive and now hold some of the most senior positions.”

By David South, Development Challenges, South-South Solutions

Published: April 2010

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

Follow @SouthSouth1

Google Books: https://books.google.co.uk/books?id=RR6YBgAAQBAJ&dq=development+challenges+april+2010&source=gbs_navlinks_s

Slideshare: http://www.slideshare.net/DavidSouth1/development-challengessouthsouthsolutionsapril2010issue

Southern Innovator Issue 1: https://books.google.co.uk/books?id=Q1O54YSE2BgC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 2: https://books.google.co.uk/books?id=Ty0N969dcssC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 3: https://books.google.co.uk/books?id=AQNt4YmhZagC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 4: https://books.google.co.uk/books?id=9T_n2tA7l4EC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 5: https://books.google.co.uk/books?id=6ILdAgAAQBAJ&dq=southern+innovator&source=gbs_navlinks_s

This work is licensed under a
Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.