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Double digit interest rate, challenge to businesses – Suleiman Yusuf

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By Ebele Orakpo

Mr. Suleiman Yusuf, a 1997 graduate of Economics from Bayero University Kano, is the Chairman/Chief Executive Officer of BlueCamel Energy, a renewable energy company. In this chat with Financial Vanguard in Abuja recently, Yusuf spoke  on what led him into the renewable energy business, the challenges and said funding is a major challenge. Excerpts:

Upon graduation, Mr.Suleiman Yusuf did his one year mandatory service to the  fatherland. Like most Nigerian graduates, he was in the labour market for sometime but eventually got an appointment with the National Agency for the Prohibition of Traffic in Persons and Other Related Matters (NAPTIP) as an intelligence officer. He worked there for seven years during which time he was able to garner a lot of experience plus local and international exposure.

Although he was working and receiving salary, he was  not satisfied unlike the average Nigerian youth who will not be concerned about making impact in society or job satisfaction, as long as he is paid regularly.

“Over the years at NAPTIP, I felt completely underutilised and I had always had the feeling that sooner or later, I would be on my own,” he said.

This opportunity came in an ugly garb but he recognised and promptly seized it and today, he is one of those to be reckoned with in the renewable energy business in Nigeria.

The opportunity:

He said; “The whole idea was based on one event. I purchased three inverter systems for myself, my mother and one of my brothers about four years ago. Unfortunately, mine had an issue just within three weeks of installation and I went back to the dealer who insisted that I pay another 50 per cent of the total cost.

I was wondering why, because I thought we had a one year warranty. They were so arrogant about it because so many customers kept coming in and out. I saw the inflow of people and that made it very clear to me that there is demand. I felt that if the only people who were offering these services are treating people this badly and not giving value-added services, I felt I could compete in the industry.

*Suleiman Yusuf
*Suleiman Yusuf

At that point, I started making my moves and within the next six months, I converted my wife’s cosmetics shop to my first outlet and we made contacts with a couple of suppliers. That was how we started in June 2010. Shortly afterwards, I resigned my appointment. We started with just two staff and today, we have about 20 staff on our payroll and a number of contract staff.”

Challenges:

Speaking on the challenges, Yusuf noted that certain challenges are peculiar to the renewable energy industry in Nigeria which include funding, substandard goods, manpower, etc.

“We are having challenges with accessing funds in banks because of high interest rate. I started with a facility of N5 million and was servicing it with  about N80,000 a month, almost N1 million per annum, quite on the high side! But because we believed we could meet up, we took the loan.

“We realised that the importers of most of these products are not educated in this field, they have no knowledge or ability to look at products specifications, have no access to real information on what they are selling so whatever anyone is willing to pay for, they are ready to bring in.

While standard solar panels were going for N350 per watt, the Chinese panels were going for as low as N180 per watt and you are supposed to compete with people who don’t know these things. So mostly when we give out proposals/quotations, our prices look unreasonable because of these other products in the market.

“An average solar panel is supposed to last for about 25 years; most of the Chinese companies selling solar panels today have not existed for up to 10 years so how could they have tested their products?” he queried.

“Technical expertise is another challenge. We have so many professionals in Nigeria but I tell you, we need technical people the most. That is the only way we can industrialise. We have local inverter manufacturers but they have not had any kind of support or recognition from government, yet we spend our foreign exchange to import these inverters from India.

State governments should be able to sponsor  people who are willing to study engineering or renewable energy, or whatever. This is the kind of move that will translate into industrialisation in the future,” he said, adding that high rent is another challenge as they pay N2.5 million per annum for a 100 square metre office space. He appealed to government to allocate  land to business people to build offices.

Secret of success:

“We first identified the key areas where people have been denied services in this field. You buy an inverter today, no arrangement for maintenance, no contract of any kind so when there is a problem, you are on your own. The seller on his part had no basic knowledge of what he is selling, he doesn’t know how soon it will pack up or for how long it will work.

That encouraged us to go into research and development. We have a research department, a laboratory and a workshop where we have been researching and actually challenging a number of Indian companies that have been bringing in substandard materials.

“We have also been developing skills, training students and others. If you scale down my staff strength of 20 to eight, we   can keep the job going but we  felt that as a socially responsible company that even if we don’t get value from everybody who works with us, we should be able to improve the value of the society generally by training people who will employ others in future. That has always been our mindset.

“We had challenges in the first few years,  but what I did was to train people myself and also engage expatriates in training my staff and it has given us very good results. We have reduced the amount of money we spend on after-sales support between 2010 and now by about 50 per cent because we have improved our technical expertise so it is an area we need to invest in,” he said.

He regretted that service providers who have the know-how really don’t get access to government projects. “For obvious reasons, we don’t get the contracts. You can go through the normal process and all that and eventually see a tailoring company bringing the LPO to you.”

To address the problem of substandard goods influx into the country, Yusuf said they have decided to form some kind of association. “It is going to bring together stakeholders in this industry and also give them some level of autonomy, not to take decisions but at least to advise government on certain areas.”

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