African Entrepreneurship Records 2

Chapter 1051 Development from "Need"

Hemers went on to say, "To improve the taste of food, you don't have to follow conventional routines. Take tofu pudding for example. Some people like sweet taste, some like salty taste, and some like spicy taste. There is a huge market for all kinds of tastes, but not many people paid attention to it in the past. This is an opportunity for our city's food processing companies."

"Take the flour mill for example. We developed a biscuit factory based on the flour mill. In order to produce biscuits with more flavors, the demand for sugar, salt, dried fruits and other things will naturally increase. Based on this, I can develop a raw material supply factory."

Randall and others thought carefully about the scene described by Hemers and had to admit that it made sense.

Randall said: "We can conduct preliminary trials, and if the results are significant, we can then develop supporting industries step by step."

Hemers: "I can't say about other places, but there is absolutely no problem in the entire area. Of course, if it is just to meet the needs of the people in this city, then the scale does not need to be too large. It is enough to build small and medium-sized factories."

This is actually the establishment of local food processing enterprises, which is quite common in East Africa. However, the products produced by East African food processing enterprises are too single at this stage, and the city of Iringa intends to build the city's food industry from the perspective of meeting different "needs".

Hemers went on to say: "The food processing industry is just a fairly basic industry. We can make full use of our city's wheat to realize the layout of related industries."

"In fact, we in East Africa have a resource that has been neglected for a long time. If we can make use of it, I think our city's light industry will definitely be greatly developed."

Hemers did not keep the secret, he said directly: "And this resource is the labor force. At the beginning of this century, our country's population has reached more than 80 million. East Africa is actually not too short of population. Utilizing these labor resources and developing processing and manufacturing industries can make up for some of our city's disadvantages."

"For example, the textile industry does not necessarily have to be established near cotton-producing areas. Nairobi, Bulawayo, Gezira and Mogadishu are all typical cities with strong textile industries that have developed based on cotton planting."

"However, Germany and the United Kingdom, as textile powerhouses, rely almost entirely on imports for cotton. The cotton textile industry in our East African city of New Frankfurt also relies on the railway transportation hub."

"This shows that the development of the cotton textile industry is indeed inseparable from raw materials, but it does not necessarily have to be close to the production area. The cotton textile industry is a typical labor-intensive industry, and labor and market factors have a great impact on the cotton textile industry."

"Take Germany for example. Germany has a very high population density, a large labor force and a broad market, which are prerequisites for the development of Germany's cotton textile industry."

Germany's area is less than one twentieth of East Africa's, but its population is nearly 50 million, close to half of East Africa's. So even for East Africa, Germany is a populous country.

The three characteristics of large population, developed industry and high income determine that the domestic market for Germany's textile industry is vast, and the abundant labor force provides convenient conditions for the development of Germany's textile industry. It can be said that compared with East Africa, Germany's conditions except cotton planting are more conducive to the development of the textile industry.

This is reflected in the fact that Germany has far greater advantages than East Africa in terms of labor, technology, capital and market. In addition to its own market, Germany's neighboring countries have strong consumption levels, and German textiles are also very popular in the international market.

“From this, we can see that Iringa City is not without the conditions to develop the textile industry. Although our city is not a major cotton producing area, it is not far from the cotton producing areas of Lake Malawi and Lake Solon Province.”

"As for the labor force, the urbanization level is improving and the agricultural population is moving to the cities, so it is not a problem for us." Randall interrupted: "But the cotton textile industry in other cities is also developing well. How can we compete with those state-owned factories?"

Hemers explained: "This involves the demand I mentioned earlier, which can also be understood as the market."

"The cotton textile industry is a fairly large industry category, involving many industries. Whether it can create value, it is ultimately necessary to sell the products. The geographical location of our city and the situation of domestic cotton textile products are destined to have great potential in the domestic market."

"East Africa has experienced more than a decade of development, but our country still has a serious problem, that is, the industrial product categories are single and cannot meet the needs of everyone. Just like the people who read Hamlet, there are a thousand Hamlets in the hearts of a thousand people, and everyone's aesthetic taste is different."

"The downstream end products of the cotton textile industry, such as clothing and bedding, are most likely to reflect this result. There are very few types of clothing on the market in East Africa, which means that the domestic people have few choices. But does having few choices mean that the people have less demand? In fact, it is just the opposite. It is not that the people do not want to choose, but that they do not have a choice."

"Take my daughter as an example. Last week, my eldest daughter bought a skirt made in Dodoma City, but the skirt was ugly, so with the help of her mother, she sewed a lot of patterns on the skirt."

"The skirt is ugly, so why did my eldest daughter buy it? Because she thinks there is no ugliest skirt in state-owned stores, only uglier ones. Of course, my daughter's aesthetic taste may be different from others, but is this a new demand? If there is a skirt my daughter likes on the market, she won't need to make changes to the skirt she bought."

“So when our city develops light industrial products, we should provide more diversified products based on the needs of our people, so that market sales will not be a problem.”

"We don't necessarily have to develop the upstream cotton textile industry. We can focus on the terminal industries that require fabrics, such as ready-made clothes, tablecloths, curtains, etc."

"Raw materials can be imported from other cities, and we process and improve them according to market demand. This will create a perfect closed loop and drive the development of the city's light industry."

"The same is true for other industries, such as the ceramic manufacturing industry. We can gain market share through innovation and manufacturing good-looking products. We don't have to judge the quality of products by whether they are resistant to falling or whether the materials are solid."

Hermes's remarks can be said to be a lesson for the government officials of Iringa City. After all, industrial development is about selling products, and to sell products, it ultimately depends on customer demand, which may not necessarily be quality and price, but may also vary due to personal aesthetics.

Mayor Randall said happily: "Hermes' words really enlightened me. Our city's industrial investment should follow this idea. Just like Hermes said, only by producing goods that people need can we develop our city's industry."

"And through this form, we can also form differentiated competition with other cities and accelerate the development of our city's industry. Our city's development in heavy industry is indeed prone to restrictions, including talent, education, mineral resources, transportation, industrial base, etc., and light industry is our magic weapon to keep up with other cities, and the development of light industry must pay more attention to market demand."

"Our city is not a coastal area, so we must pay more attention to the domestic market, take the domestic market as the foundation, vigorously develop food processing and other labor-intensive industries, provide more light industrial product categories for our country, and meet the diversified needs of society."

After all, if towns like Iringa want to make a breakthrough in the industrialization stage, they still have to rely on light industry. Light industry occupies a major position in the world, and East Africa is not a strong light industry country. Therefore, those cities that can seize the opportunity at this stage can occupy a place in the East African industrial system through light industry, and even surpass some heavy industrial cities.

(End of this chapter)