112 Years After, CFAO Repositions (allAfrica.com)

After 112 years in Nigeria, CFAO, the French conglomerate, is undertaking a strategic repositioning of its business operations for more efficient management.

Convergence into three industrial sectors is the policy direction that will drive the new CFAO Group to deliver a more efficiently managed conglomerate with the aim of maintaining its market leadership position in the various sectors of its market segments, CFAO management has stated.

Expectedly, the restructuring of the 112 year old business institution would see the convergence of CFAO’s businesses under three functional industrial sectors with each unit being run independently by a Managing Director all of whom will report to a Group Managing Director.

According to CFAO management in each of these three divisions, the group manages and develops a balanced portfolio of strong international brands. It added that the group was well-equipped to serve the Nigerian market better, allowing it to deliver lasting, sustained growth. These areas of expertise, which will be headed by separate Managing Directors under the supervision of a Group Managing Director include automobile and equipment, healthcare and consumer goods.

With the new arrangement, CFAO Motors Nigeria Limited and http://dailyindependentnig.com/wp-content/uploads/2015/07/Directors-of-CFAO.jpgCFAO Equipment subsidiaries are under automotive and equipment unit. Auto brands under automotive franchise include Mitsubishi, Chevrolet, Fuso, DAF Trucks and King Long. CFAO Equipment has companies like Otis, Hyster, Doosan and Bobcat under it. Trading under Assene Laborex the companies under the healthcare units include Norvatis, Sanofi Astrazeneca, Sandoz, Dafra Pharma, MSD, Abbvie and Servier. Two companies, Nipen, which manufacturers Bic and premium pens and GI&D under which are Friedsland Campina, Cadbury, Pernod Ricard, Ferrero, Gongoni, Niger Biscuits and Food Empire operate on the Consumer goods sector.

This new thinking may have been informed by the need to stem the rate of collapse and or divestment of some CFAO once flourishing subsidiaries. Maltex, the first malt drink brand in Nigeria; Electrohaul, Transcap, Qualitex, Structec, General Import and Distribution were some of the subsidiaries that either went out of business or were divested. Most of these brands, before their exit from the group were not associated with the group, a factor that may have contributed to their unfortunate and premature exit from the CFAO family.

To communicate the new offerings to its target audience, the group has rolled out a nationwide campaign tagged “Opening Up a World of Brands” to make for clarity and brand association in the minds of prospects.

For over a century, CFAO has concentrated its operations on the African continent with Nigeria as its business hub. CFAO owes its success to its in-depth knowledge and experience in Nigerian market as well as the huge contributions of its committed indigenous staff. The Group contributes about N31.4 billion to the country’s GDP. With five subsidiaries and a record 26 brand portfolio the group currently operates in 112 locations, employs 1,300 staff in Nigeria. CFAO also operates in other 34 Africa countries, seven French overseas territories, in Denmark, in Portugal, in Italy, in India, in Vietnam and in Cambodia.

It will be recalled that CFAO made its entry into Nigeria market in November 1902 when it set up a full-fledged operation in the then colony of Lagos where goods from France and Europe were sold to expatriates and local people with European taste. As its operation expanded with a need to make more profits CFAO expanded into exportation of agricultural products to Europe and France.

As it continued to record more profits the business expanded to the hinterland into places like Kano, Sokoto and Gusau to take advantage of the trans Saharan trade network in the area; a transit and store location at Umuahia; a coal purchasing shop at Enugu; an oil palm shop at Calabar and transit commodity market at Aba which later transformed to the current Aba market and also Onitsha.

However the First World War, which broke out in Europe in 1914 over trading competition in colonies of Africa and Lagos was to reshape the face of CFAO business in Lagos colony as its shop houses at different locations including Marina, Bamgbose and Apongbon were brought under the same roof at 1 Davies Street under the same management. The group devised other strategies that enabled it outlive the war which lasted for over four years. This included training and employing local staff who served as a stabilising force to fill the employment gap created by the absence of French expatriates most of whom were conscripted to fight the war or had no access to Lagos due to the raging war. Among the first Nigerian staff who held sway during the war was Master John Hussein Okoya-Thomas, one of the most intelligent, resourceful and energetic indigenous staff whose commitment to work paved the way for the employment of other indigenous staff to fill in the gap created by the scarcity of expatriates who couldn’t be posted outside Europe at the time due to the ravaging war. Okoya-Thomas remained the longest serving staff of CFAO in history having worked for about 52 years. He was to pave the way for the long standing relationship between CFAO and the Okoya-Thomas descendants as his first son, late Chief Molade Okoya-Thomas succeeded him in 1959 and served the company at different levels uptill 1987 when he was appointed Chairman.

“Between 1945 and 1960 massive restructuring of the CFAO shop houses network throughout Nigeria was embarked on. The VLMD, a wholesale department became known as General Import; the hardware shop became known as Structec; the Radio Shop was transformed to Electo Hall and the Fancy Shop, Perfumes Shop, Drinkables Shop and Provision Shop were merged to become Moloney Self Service which later were to be changed to Moloney Supermarket.” All of these businesses have since been divested.

Over the years CFAO evolved different strategies of staying strong in business. Nigerian investment climate in the past over 100 years, owing to its wealth of natural resources as well as a large market arising from its population, Nigeria has continued to witness significant growth especially with inflow of foreign investment. These investments which span decades from the colonial era to the present day cut across virtually all areas of economic activity such as mining and quarrying, manufacturing and processing, agriculture, transport and communication, building and construction, trading and business services. In most of these areas of investments, CFAO Nigeria participated actively using available technology at each point in time.

And since its future is inseparable from that of Africa, CFAO has a long-term commitment to furthering the continent’s development. This commitment was reaffirmed in its website. “As an organisation with historic roots in Africa, CFAO has a duty to be exemplary, as well as specific responsibilities to society and the environment. On this continent where sustainable development is a particularly critical issue, the Group continually takes new steps for the benefit of its employees and local communities in the countries where it operates. CFAO’s approach involves four key priorities namely implementing corporate social policies that are compatible with local conditions, ensuring the activities of Group subsidiaries are environmentally friendly, helping achieve millennium targets for alleviating poverty through community programs to support healthcare and education and ensuring that its employees buy in to the rules laid down in the Group’s Code of Business Conduct.

Today, CFAO has evolved into a highly diversified divisions and subsidiaries contributing to the growth of the manufacturing sector of Nigerian economy with a plan to venture into other areas in future.