By Gugulethu Hughes
Editor’s note: The opinions expressed here are those of the authors. View more opinion on ScoonTV.
When the chips went down, KFC in Kenya chickened out from making fries. The reason was because of a potato shortage caused by delayed shipments from Egypt.
At face value, this may come across as a function of operations management. It may even spark an engagement on agile, lean, and Just In Time supply chain models. But, on the contrary, this serves as a good example of corporate arrogance and disdain for activities that may lead to the empowerment of natives.
In this case, the natives are the local potato growers in Kenya. The lack of political will from the Kenyan government is responsible for the cultivation of corporate arrogance. If they wanted, they could sign a law so multinationals like KFC have to channel a big spend of their procurement into local producers.
It took Twitter users to push KFC into reconsidering its procurement and sourcing strategy. The Standard, on the 4th of January 2022, quoted the KFC East Africa market chief executive officer Jacques Theunissen’s response to the crisis. He said, though there is a potential of sourcing potatoes from local suppliers soon, the current position is that local purchase is not possible. The reason is that suppliers need to first undergo a rigorous worldwide QA approval procedure.
Quality and safety criteria are also what KFC highlights as barriers to utilizing local suppliers. Another issue raised is that there isn’t a major supplier of pre-sliced blanched frozen potatoes in Kenya.
Now, all these straw men raised by KFC in Kenya are valid. After all, businesses have Standard Operating Procedures that require strict adherence. But the multinational isn’t being criticized for having SOPs in place. Rather, it’s the company’s reluctance to transform its procurement processes in a manner that will stimulate the local market.
For context, KFC initially opened in Kenya in the 1970s. They then withdrew but reopened in 2011. They now have 22 outlets in operation. KFC has used South Africa as its springboard for the penetration of other African markets.
When the company re-entered Kenya in 2011, there was vast excitement in Nairobi. The Kenya National Chamber of Commerce and Industry hailed the launch as proof that Kenya was an attractive investment destination.
To quote the former Kenyan National Chamber of Commerce and Industry chairman, Laban Onditi, “the fact that KFC chose to open in Kenya first, among all other East African countries, shows the country is an investment destination…In Kenya there is still a very virgin market that has not been fully tapped.”
At the time of the launch, U.S. group National Restaurant Consultants’ President, David Kincheloe, said he had begun looking into a KFC franchise in Kenya for a different investor 24 months prior. However, the supply chain was the biggest stumbling block.
In his words, “Once you’re able to get KFC in and you’re able to work out the issues with the supply chain, maybe you’ll see a Long John Silver’s, a Pizza Hut, a Taco Bell.”
The launch was characterized by long queues, with customers waiting for hours to get a taste of Kentucky in Kenya.
Clearly, multinationals have always been aware that supply chains are the main pillar of its business. Once the supply chain processes were mapped and bottlenecks were isolated, the 2011 launch became the next logical step.
The company claims to be getting other products from Kenyan suppliers. But when supply chain issues were being attended to, KFC neither got potatoes from Kenya nor empowered local producers to meet KFC global standards. This is the reason why, over 10 years later, the company still imports potatoes.
To this day, no communication has been made to local producers on qualifying product quality. Francis Kimemia, Governor of the County Government of Nyandarua, the county with the highest production of potatoes in the country realized this too. He released a statement soon after KFC gave reasons for their inability to procure potatoes from the local producers.
Part of his statement reads, “We find KFC’s excuse insensitive to farmers who are putting efforts to produce quality potatoes…a holistic approach is needed to ensure that potato farmers across Kenya reap from their sweat. The National Government is therefore duty bound to protect farmers’ interests by ensuring that imports of readily available produce are either prohibited or highly discouraged. By enforcing the ‘50 kilograms potato packaging regulations,’ our farmers will have another reason to smile”.
Tom Kamaliki, a leadership consultant based in Kenya, said this on his LinkedIn, “KFC, like most multinationals, do not see any sense in empowering indigenous Kenyan farmers. If quality of potato is their concern, as they claim, then they should invest in research and work out a viable and sustainable plan with the Kenyan farmers and other stakeholders, which will lead to quality yields and constant supply of the quality potato they need!
Potatoes aside, it has been a trend that most multinationals have always wanted people from their countries to work in certain specialized areas, hence failing to transfer knowledge to the indigenous as an empowerment strategy. This is the same strategy that KFC is deploying by importing potatoes and leaving the Kenyan farmer disfranchised.”
Now that the horse has eventually bolted, Africans have been presented with an opportunity. They should conduct a holistic evaluation of supply chains of multinational companies in Africa. More so, they should do it with a firm position of helping local industries.
Supply chains are the most integral component of political, social, and economic transformation. Legislative environments must reflect the true realities of Africa. It’s a continent endowed with productive land, minerals, and possibilities for its population.
They have the requisite intelligence to create products that meet any global quality standard. The continent must begin being a trendsetter. Countries must create their own standards for any multinationals that want to do business in Africa to adhere to.
We can no longer afford to live a life of being end users when we are the source of life in this global economy. No matter how you slice it, many supply chains depend on Africa, its resources, and its people.
Subscribe to get early access to podcasts, events, and more!
