Minting money from coffee liquor

After failing to secure internship placement during their second year at Makerere University, four youth were prompted to start a company.

The youth — James Kiwalabye, Otai Otegu Marshal, Breach Nuwagira, Josephat Kaijage are now their own bosses.
In 2013, they registered a company called ‘Real Agricultural Solutions for Africa’. They ventured out in different business ideas but they are currently known for production of coffee liquor.

James Kiwalabye, the business’ chief financial officer for Real Agricultural Solutions for Africa, shares: “We developed this idea together with three other colleagues during our second year at university. By then, we were looking for internship placements in 2013. It was a difficult experience and we walked to almost all offices dropping applications but we couldn’t get placement.”

“After this hustle, we thought if it was hard to get placement to offer free-labour, how about if we were looking for real employment? This experience motivated us to start our own business,” Kiwalabye says.

Initially, they were vending vegetable plus growing and distributing nushrooms to customers.
Later in December 2013 – there were calls for proposals for people who had brilliant ideas to add value to coffee.
The calls came from the Consortium for enhancing University Responsiveness to Agribusiness Development Limited (CURAD).

CURAD is a public-private partnership initiative with the aim of producing innovative young entrepreneurs and agribusiness leaders to champion productivity and profitability of the agricultural enterprises that can spinoff new enterprises.

This is an agribusiness innovation incubator geared towards creation of jobs and boosting incomes within the agricultural sector in Uganda piloting with the coffee value chain in the first four years.
Kiwalabye says he thought about the idea of Coffee liquor with his friends.

Why liquor?

He said: “When we looked at the market, the liquor which was available was imported and very expensive yet Uganda is a big producer of coffee which is the main ingredient.”

Banking on the opportunity of Uganda being a big producer of coffee meant that they were assured of the raw material and during market research; they discovered that Uganda did not have its own liquor.

“We sent in a proposal and it was approved. We started to work on developing the product,” Kiwalabye shared.
When they all graduated in January 2015, while their fellow graduands were preparing to look for jobs, Kiwalabye and his colleagues were already in business.

Kiwalabye says that initially when the call from Curad came; they were asked to develop a prototype of a product. That’s how they came up with the coffee liquor. With the help of Faculty of Food Science Makerere University and Curad on developing and branding the product, they hit the market in 2014.
It was during the annual agricultural show in Jinja in 2014 where the coffee liquor was launched.

“The response was so overwhelming; the initial aim was to test the product to the public during the show. But on the fourth day into the show which was supposed to last seven days, the products were finished,” Kiwalabye recalls.

Process
The youth buy coffee directly from farmers both from the growing Arabica and Robusta. He shares that they blend both species to get a good aroma.

After getting the beans from the farmers they are then taken to the roasting facility and from here, the coffee is mixed and kept for six to eight months, a period that helps the liquor to mature. During this period, the mixture is kept in barrels. On maturing, the final product comes out as an alcohol which is dry.

“We are going to introduce branded coffee, coffee yoghurt and branded roasted coffee,” he said.
The party-four then pulled personal savings and with help from Curad, they raised Shs870,000 to start production and they have been reinvesting the proceeds. Currently, the business is worth Shs60 million.

Kiwalabye says that in the beginning they used to produce 45 litres of liquor every week and this would be done twice a month.

But since the market is growing big, they are currently producing 900 litres every month.
Their biggest market is in small supermarkets in and around Kampala.

“We have a distributor in Mukono, Jinja, Masaka and we also have a small outlet in Mbarara and market door-to-door,” he says.
Currently, they are negotiatinG with big supermarkets where they will start distributing by the end of this year.

He adds that their product is also on the shelves of the ‘Omukago Coffee Shop’ along George Street - their biggest wholesales point.

They pack their products in litres, 500ml, 300ml and 200ml whose price ranges from Shs2,000 to Shs20,000.
The business currently employs 16 people and has a chain of 280 coffee farmers who supply them with the beans both Robusta and Arabica. The monthly gross income is worth Shs6 million.
They have a processing plant at Komamboga-in Kawempe Division –Kampala District where they rent a residential house.

Kiwalabye shares that they have plans to acquire a bigger piece of land where they will establish a permanent factory.
They are also in the process of certifying their product with Uganda National Bureau of Standards to acquire a quality mark. Once this is achieved, they will aim at ISO certification which will help them explore the export market.