Building a Business Not for the Faint-Hearted Says Swaady Martin-Leke

Swaady Martin-Leke
Swaady Martin-Leke

AFRICANGLOBECote d’Ivoire-born Swaady Martin-Leke is the founder and CEO of YSWARA, a newly launched African tea company that is targeted at the higher-end consumer market. The company is based in South Africa, but sources its teas from across the continent. According to Martin-Leke, the luxury market in Africa offers increasing opportunities with the steady growth in the African middle class and discretionary income.

Before starting YSWARA, Martin-Leke spent eleven years of her career with General Electric. We asked her to tell us a bit more about the tea market in Africa and her advice to other aspiring African women entrepreneurs.

Who are your customers?

As for any global luxury band, our customers are all over the world, in Africa and outside of Africa. Right now, about 90% of our customers are in Africa (we launched six months ago) but we ship our products all around the world via our online shop.

Where do you source your teas?

Africans have long understood the healing power of plants. The fragrant leaves of the hibiscus have long been popular in Western Africa; drinking kinkeliba bush tea is a daily ritual for many in Senegal and Gambia. Rooibos, honeybush and buchu were harvested by the Khoisan people of Southern Africa and are still celebrated for their medicinal properties.

Today, YSWARA harnesses this ancient knowledge in collecting the world’s largest selection of fine African teas. Our single estate, orthodox teas are grown in the verdant fields of the finest African tea estates, whether it be the rolling hills of Rwanda‘s Rukeri Estate or the misty peaks of Malawi‘s Shire Highlands. Each of these rare leaves is handpicked and sun-dried, processed on their individual farms using only natural methods.

Currently we source from South Africa, Malawi, Rwanda and Kenya. Our plan is to source from all tea producing countries in Africa: Burundi, Cameroon, Kenya, Madagascar, Malawi (the first country in Africa to cultivate tea), Mauritius, Mozambique, Rwanda (which has a reputation for superior taste among African teas), South Africa, Tanzania, Uganda, DRC, and Zimbabwe.

Describe some of the challenges you face in running this business.

Building a luxury brand fully African-made presents tremendous challenges which my team and I are still overcoming every day. Today, our product is about 90% made in Africa and we have a target to reach 100% by end of next year. The main challenge is that our Africa industrial fabric is not made for high-quality goods produced at a competitive cost relative to China or India. We struggled to find suppliers who source or manufacture their products in Africa. Then, when world-class quality is met, the consistency is not guaranteed. For example, our tea tin manufacturer just closed this month and there is no alternative in Africa.

Our artisans are mostly not set up to scale their activities and are often paralysed by the prospect of growing their business beyond the “enough-to-live” stage. As a luxury brand, we cannot afford any inconsistency in quality nor sub-standard quality levels. We are competing with international brands, benchmarking ourselves to the best as we want to grow big. On the export side, the cost of exporting outside of Africa is still too high. This is hampering growth of internet sales as well as opportunities to export out of Africa globally. Despite all these setbacks, we are persevering and most of them turned out to be unexpected sources of strength.

As I was sharing those challenges with a wise mentor, he advised that “everything that is too easy is also easily replicable”.

In your opinion, are there growth opportunities in the tea industry in Africa today?

Absolutely! Tea is the world’s second most drank beverage. Whereas the growth rate of coffee consumption is declining worldwide, the one of tea is growing mainly due to a growing health concern of populations. Within the tea industry, speciality tea is the fastest growing segment. The gourmet tea market is a niche which is not saturated, with only a few luxury brands. Most tea brands are in the premium and mass-market segments.

It is a well-known fact that Africa is the home of numerous raw commodities but most of them are not transformed locally. This is the case of superior quality teas which are widely unavailable in Africa. And when available, often they don’t meet the quality standards of similar teas which could be found in tea houses outside of Africa. Tea is usually exported at a relatively early stage in the supply chain. Nearly all of the tea – more than 90% – is exported in its raw form to be packaged and processed abroad.

Blending and packaging are the most lucrative part of the tea trade. About 30-50% of the consumer price of tea goes towards blending, packing, packaging materials and promotion. Most of the value is not captured by the domestic industry. This is quite an absurd situation when Africa is the world’s third largest producer of tea and the world’s largest exporter. While, for a given quantity of rooibos, the local price of a basic quality is more than 20 times cheaper than a superior quality sold overseas. Most of the value-add is created outside of Africa and is not benefitting the producing communities.

In addition, marketing is becoming ever more important for tea brands. Tea production countries are usually insufficiently equipped to address consumer choices, which make value addition even more difficult. Large profits therefore do not accrue to the tea-producing countries, let alone to the small farmers or plantation labour force. This alienation of the farmer from the market is worsened by the increasing market share of innovative processed products, such as iced tea or instant tea, that demand advanced production and packing technology and a matching marketing budget. In creating an African gourmet tea brand, YSWARA, we are retaining most of the value-add in Africa and participating in a movement to reverse the status quo.

As a respected businesswoman, what advice do you have for other aspiring women entrepreneurs trying to make it in Africa?

Before you start anything, my advice is to find your passion and pursue it passionately. In addition, as an entrepreneur, you need to be able to create a compelling vision, to passionately own the vision, to define the roadmap to execution, and to bring together and relentlessly drive the energies, the talents and the values necessary to ensure success. You need to become an execution machine. Building a venture from scratch is not for the faint-hearted, you need to be courageous, tenacious, have perseverance and resilience. Never take no for an answer and be solution-oriented, constantly.

I love this quote from journalist Eric T. Wagner who wrote: “True entrepreneurs never, never, never quit. Never. Like a bull-dog latched onto a bone. Like a mountain lion with its jaws around the neck of a deer. You’re not prying any of this loose. And the same goes for trying to hold a good entrepreneur down. Not going to happen.”

 

By: Kate Douglas