Affiong Williams, the CEO of ReelFruit, sees the Nigerian diaspora in America as a prime opportunity for her company to enter the US market. She believes that Nigerian consumers in the US are likely to be drawn to ReelFruit’s products out of nostalgia, but she also recognizes that the company’s products must appeal to a broader US audience in order to be successful.
ReelFruit previously sold its products in the US through its online store and Amazon, but it has since pulled back to re-evaluate its strategy. The company is now working with a US-based distributor to place its products on the shelves of traditional African stores across the country. It has also brought on board a broker who has helped to secure new deals, including one with a US e-commerce platform.
There is no better market, or no lower hanging fruit, than your people in another country – Affiong Williams
ReelFruit benefits from the Africa Growth and Opportunity Act (AGOA), which allows duty-free access to the US for qualifying sub-Saharan countries. This gives Nigerian manufacturers, like ReelFruit, a significant advantage when entering the US market.
Williams believes that the current economic challenges in Nigeria make it an ideal time for Nigerian food and agriculture companies to go global. The naira has fallen to a record low against the US dollar, and inflation is at a 18-year high. This makes it more expensive for Nigerian companies to import inputs, but it also makes their products more competitive on American shelves.
Williams also emphasizes the importance of targeting markets with greater disposable incomes, such as the US, when exporting. Given the strain of domestic inflation on the spending power of Nigerians, capturing a modest portion of a dollar-paying market can assist businesses in navigating Nigeria’s tough economic climate.
Williams counters the common belief that exporting food products to the US requires extensive certifications. She explains that the need for certifications depends on the buyer, and that they are not always necessary. However, she does highlight that operational aspects, such as last-mile delivery and merchandising, can present challenges for companies that are not physically present in the US market.
It is hard to know where you will strike gold. I have been to several trade fairs, and I never got a buyer [from these]. Relationships help because people who know buyers will introduce them to you. This is usually where you have the highest strike rate – Affiong Williams
To cater to the preference of US buyers for immediate access and local availability, companies can establish local partnerships, such as teaming up with distributors or finding warehousing and logistics partners. Williams recommends casting a wide net when building networks and relationships, as it can be difficult to know where you will find the right partners.
ReelFruit is not currently pursuing placement of its products on the shelves of major US retailers. Williams explains that this is a costly strategy, and that it requires a significant investment in advertising. Instead, ReelFruit is focusing on becoming a renowned partner for co-packing with US brands. This would allow the company to produce and package products on behalf of its clients without having to bear the brunt of the marketing risk.
Many foods exported from Nigeria to the US are for Nigerians in the diaspora, however, if people could produce food and snacks with wider appeal it could be a big opportunity – Affiong Williams
ReelFruit has recently upgraded its production capabilities, and it is currently negotiating a co-packing deal with a US brand. The company’s goal is to be recognized as the go-to company for various types of tropical dried food, customized to meet the preferences of US customers. Should this strategy prove effective, the company might consider bringing packaging in-house, which would allow it to handle the entire processing and packaging process in Nigeria.
The US is the world’s largest consumer market, worth $16 trillion, while Nigeria, despite having a population of over 220 million and being one of Africa’s biggest consumer hubs, is expected to reach a market value of only $3 trillion by 2030. This stark contrast highlights why the US could be an appealing target for many businesses in Nigeria’s food and agriculture sector.
By Elijah Christopher