What you need to know:
- The old man would buy coffee from farmers and sell it to Coffee Marketing Board (CMB). When he passed, the business did not survive. Miiro picked up from where his father left off.
His curiosity about coffee started early. Tony Miiro grew up in a home where coffee was grown. His grandfather was a coffee dealer and founded the Kasana Coffee dealership in Luweero District.
The old man would buy coffee from farmers and sell it to Coffee Marketing Board (CMB). When he passed, the business did not survive. Miiro picked up from where his father left off.
With a business partner, Ambrose Atipo, a lawyer with whom he went to high school, they have formed and registered the Nonda Coffee brand. They are selling coffee locally and are seriously considering the possibilities of exporting it too.
Nonda is a Luganda word that means to choose or select. As such, the business philosophy of its directors is to focus on the ability to choose what they want, so that they can be able to attest to what they like.
“What brought us into the business of value addition to coffee is not because other players in the industry were not doing it but we feel coffee has a beautiful story of the Elgon roasters from as far back as the 1980s; foods and beverage era down into the privatisation period of the 1990s,” Miiro explains.
He adds that people have been in the coffee business for generations and have come to run flagship brands, over time, such as Good African Coffee and Ban Café who have been at it for more than two decades, and still counting.
“Since 2012, the coffee production in Uganda has been increasing by almost 30 percent per year. That is very big growth, as of last year, Uganda became the number three coffee exporter in the world. Both the quantity of coffee exported and its quality has been very good because a report came out this year where a Ugandan coffee cup was number three in terms of quality on a global scale.”
Uganda is one of Africa’s biggest coffee exporters, mainly exporting the beverage to Italy, Germany, Belgium, India, and Sudan. Coffee is one of the country’s big export, standing at approximately 22 percent. In 2019 the export price of coffee stood at $1.58 (Shs7,000) per kilogramme. In the Financial Year 2020/2021, Uganda exported 6.08 million coffee bags.
Within his circle of business friends, Miiro has identified a market in Albania where contact has asked them to supply two to four containers of coffee on a monthly basis.
“I am well aware that coffee producing countries are not price makers but takers because the consumption rate of coffee in Uganda is too low. Last year we exported close to 4.05 million bags of coffee,” says Miiro. With Nonda coffee, he would like to create more awareness to boost local consumption.
He feels the time is more favourable given what he describes as the ‘the millennial wave’, of so many young people who are engaged on social media, on videos and so many platforms that give very good exposure to coffee unlike the generations before.
Miiro explains: “It is different from the time when we grew up. We identified with coffee more as a plant but I doubt the young people (today) know coffee plants, they relate with coffee in a cup. Their relationship with that coffee is through third parties such as Nescafe because it is the biggest seller in this market.”
He estimates that if he could have 10 to 20 percent of the market share Nescafe has, he would considerably achieve. He is currently studying the trend and why young people consume more Nescafe over local brands.
The lessons for Nonda is to first look into its branding as well as improvement in publicity and presenting their coffee in a clean cup.
He would also like to do some sensitisation among Ugandans on the difference between a fresh roast coffee and soluble coffee, or constant coffee. He says it is the process that makes the two different. “They both go through the process of coming from the garden, the coffee is sorted into the fresh bean. It is put into the roaster and ground. For the fresh roast, we stop at that first level of grinding, and it is the most expensive coffee even in other countries. A cup can cost as much as $5 (Shs18,000) because of the theatre that is around it. With constant coffee, it is blended into different coffees,” he says.
He adds: “They bring these coffees together, roast them, melt the roast and take it through a freezer. They then grind it and then pack it into those tins. When you put it in a cup, it automatically becomes soluble. With instant coffee, you will not see any residual but for the fresh roast coffee, there are residuals.”
Nonda brews instant coffee. At the moment, they produce 150 kilogrammes per week which are about three bags of green. A network of close to 80 farmers and dealers supply them with the coffee.
“The advantage we have with them is that they give us the very best they have. Many of them are from the Sironko District because we want to have a single origin. A small group of farmers give us their crop and we process it. They have a small association they subscribe to which makes it easy to communicate directly with them,” Miiro explains.
Nonda buys a kilogramme of already graded coffee (double-A Arabic) at Shs11, 000. They process it and transport it to Kampala for medium roasting. Their biggest number of consumers is in Kampala.
They have also flung out their wings to hotels that are happy to buy coffee that is not yet ground. “We have clients such as Gulu Churchill Courts Hotel and some other hotels along Ggaba road.”
Miiro adds: “We did not find the reason for investing in equipment because there are already different people who had invested in roasters, so we cooperate with them and optimise their roasters on a lease basis. The biggest gap that was within the value chain, was branding and marketing of the coffee and then the ability to sensitise communities or the people on the advantages of consuming local roast coffee.”
“So we invested our resources in creating the brand, market, awareness, and good relationship with the farmers. So far, we have invested close to $28,000 worth of branding and sourcing of coffee,” he adds.
He says that in order to succeed, they have had to prioritise the understanding of farmers in order to ensure a good harvest management program through which they help a few farmers to set up drying beds.
In addition, they are creating awareness among those who can afford to construct the beds. Concurrently, they are spreading the word, through workshops and on media outlets to encourage young people to relate with, and consume coffee.
“As a business entity, we have not gone the conventional way of putting our coffee products on the shelves of the supermarket because we thought it would not give us the market presence we want. We are maximising online marketing and sales in order to increase our traction. This was born out of the Covid-19 period when consumers did not have a lot of physical interaction so these things were moving without necessarily putting them in the shelves,” he elaborates.
He says that the feedback from the online community is encouraging because it reaches many people and the goods move faster. At the same time, the quality of coffee is consumed as it is, and as he adds, a fresh roast is best consumed within the three weeks of its roast.
“If it stays long on the shelf, it will be a good cup but it would miss the theatre of coffee which is the fragrance. . For now, a pack of 250 grammesis sold for Shs12,500. The pack has proved popular and commercially viable. We have another, of 100 grammes that goes for Shs5,000.”
Hinging on the fact that Uganda is a largely agricultural economy, Miiro is confident that is the coffee industry can easily fetch a hefty $10m if the government through its agency, Uganda Coffee Development Authority (UCDA) engages a deliberate approach for all the players to believe in the industry.
He argues, “There is a lot of backward and forward leakage within the industry; people who supply fertilisers, planting materials and so on. If the government can help to increase the awareness of the local population of the advantages of coffee, and boost its consumption of about 20 – 30 percent of what we produce, that alone will boost its value.”
“It is not a mistake that Robusta Coffee is an indigenous of Uganda. The crop alone can boost our economy much more sustainably than the oil everyone is looking to. It can employ many people. If we exported 4.05 million bags of coffee at just half a billion dollars, you do the per capita income,” he further argues.
His wish is to see the Nonda coffee pack and any of our local coffee on every table in the world. For now, he is looking forward to getting a tax exemption, as a local value addition company.
He pays income tax, as a shareholder, VAT as well as taxes on imported packaging materials. “Packaging is the most expensive stage to all coffee roasters,” he adds.