Surviving by circumvention: Fate of Nigeria in looming relief road unemployment 

IKEM OKUHU

Ikem Okuhu, a journalist, author, PR professional, brand strategist and teacher, is the CEO of BRANDish, publishers of BRANDish, Nigeria’s first nationally circulating Brands and Marketing magazine. He has a career that has traversed print media, oil & gas, banking and entrepreneurship. Ikem is the author of the book, “PITCH: Debunking Marketing’s Strongest Myths”, a dispassionate exposition of the dos and don’ts of successful engagement in the marketplace, especially the Nigerian marketplace. He can be reached on + 234 8095121535 (text only) or brandishauthority@gmail.com

The Nigerian Naira is on an uncontrollable plummet, competing with Ghana’s Cedi, Sierre Leone’s Leone, the Guinean Franc, and a few other backbenchers in the race for the fastest to hit rock bottom. Our currency, in the last fourteen months, has, without dignity, gone unclad before the global community, dropping an estimated 150 percent of its value, and doesn’t look like its family of minders has the creativity to stem the slide.

When the free-fall began immediately following the handing over of government to President Bola Tinubu, the feeling of economic uncertainty pervaded the country. People wondered how it was possible to navigate the harsh situation, and even mustered some of the millions of disgruntled citizens into street protestations that were quickly snuffed out, thanks to a combination of sectional politics to the unwillingness of many to be the country’s salvation guinea pigs. The #EndSARS holocaust was still fresh in many people’s memory, dissuading those who, though at their wits end economically and socially, wouldn’t want to become the cavia porcellus of another revolution of the predictably doomed outcome.

As opposed to fighting for good governance and a nicer economic regime, Nigerians began to fight other two battles – either to flee the country or to find the means of running rings around the system to survive. The system here, for clarity, is not the government system that every person that has been close to it has been cheating and serially abusing since anyone can remember. In this context, we are talking about the survival “ways and means” invented to keep food on the table.

Each time I look at Nigeria and Nigerians, I get inclined to conclude that those who decided several years ago that we were the happiest people on earth did not make any mistakes. We are certainly the happiest gathering of people God created, and it could have been because of us that Demos Shakarian, the man who founded the Full Gospel Businessmen’s Fellowship, coined the statement, “the happiest people on earth.” What Shakarian did wrong was to ascribe that title to his “Full Gospellers,” as the group of Christians is called; he should have given the tagline to Nigerians.

We are certainly a happy people, so happy that there is no affliction we don’t endure and still manage to put on smiling faces. When other citizens of other countries cry that their backs have been pushed against the wall, Nigerians wonder how it would ever be possible to be pushed to the wall – there is no wall behind the typical Nigerian. On the contrary, we have acres of spaces that impels us to manoeuvre through adversity, however cruel, and even still find the moral disposition to invent excuses for those whose misbehaviour imposed on us bad fortunes.

When faced with hardship, our people innovate around it and survive. I can give some examples. Not many people are aware that the delicious soup known as Ofe Onugbu (bitter leaf soup) was created out of the scarcity of egusi (melon seed), the traditional ingredient for making egusi soup (melon seed soup). That it has grown to become a major item on both family and restaurant menus has made many not care about its origin.

A more recent example is the surge in the bitters category of the alcoholic beverage segment. Folks are guzzling this in their numbers, but many observers will easily know that the huge sales being recorded by the plethora of registered and unregistered producers do not stem from the aphrodisiac capabilities that these mostly pint-sized plastic bottles are advertised to have been infused with. On the contrary, it is the prohibitive costs of various beers, whether national or regional, premium or value brands, that have gone beyond the reach of those who otherwise guzzled several bottles daily without draining their pockets.

There are many other examples to remind us of how our people have always innovated around difficulties, but this work will allow but a few.

However, it appears that our coping strategy is likely to create some dangerously preposterous economic dislocations that will test the incredible patience and perseverance of Nigerians. I am saying this because current trends in consumer behaviour might challenge the very elasticity that has been slapped on the people of Nigeria to their enviable adaptive behaviour.

Prices of goods and services have flown sky-high and to cope, families have discovered ingenious ways of stocking up on their groceries at relatively lower prices.

What do they do? Across WhatsApp, thousands of groups have emerged, especially among urban dwellers, where funds are aggregated for bulk purchase of food items either directly from the sources or the major distributors. Upon arrival, these items are shared among the members of the group in proportion to the amount of money contributed.

An assessment of the values derived from this method indicates a slice of as high as 40 percent off what was hitherto spent on consumables by bypassing some layers of the distributorship chain and the retailers. Items traded include essentials such as yams, tomatoes, pepper, onions, potatoes, beans, corn, rice, and the king of them all, meat.

Every weekend these days in thousands of neighbourhoods in Nigeria’s urban cities, cows and goats are slaughtered on street corners as men and women sit in wait for their shares which they carry home and stock in their deep freezers. Tomatoes and pepper are also shared in this way, ground and strained to maintain a certain level of freshness to be preserved with the aid of freezers.

On the face of it, this looks brilliant. Families are saving a lot of money, which will enable them to invest in other things even as the economy continues its merciless raid. A basket of tomatoes, which I understand, might currently be purchased for N32,000 can get to families at as low as N18,000 or even less.

Creative, isn’t it? Of course, it is, to the extent that it doesn’t lead to unintended consequences with wider economic implications, and that is why I am afraid that a new form of unemployment might be birthing in Nigeria.

Economists mostly agree that there are four main types of unemployment, and they include; frictional unemployment, caused by temporary transitions in workers’ lives, such as when a worker moves to a new city and has to find new jobs; structural unemployment, caused by a mismatch in the demographics of workers and the types of jobs available; cyclical unemployment, which happens when there is not enough demand in an economy for goods and services as a result of which businesses cannot offer jobs, and seasonal unemployment, which as the name implies, happens when different industries or parts of the labour market are available during different seasons.

The sort of unemployment that is cooking as a result of an increasing number of consumers bypassing the distributorship and retail channels is the one that I am worried about. I call it relief road unemployment and will happen when consumers are forced by the pressures of weakening purchasing power to bypass the distribution channels in search of value.

Relief road unemployment is planting its roots in Nigeria, and while those who are behind it have survival in their minds, the Nigerian government should be worrying because of the danger it presents to millions of people, including the innovators themselves. While we are not seeing the dents yet, the implications of the continued bypass of production intermediaries in the Nigerian social and economic landscape will become visible when the issue has reached a crisis point.

There are tens of millions of people involved in the distribution and sale of green groceries in Nigeria. Should consumers continue the trend of taking the relief road to survival, many of the people in these businesses will be in trouble, and with them, their families that depend on them for survival.

Also, on the crying bench beside the greengrocery businessmen and women are almost all of Nigeria’s big fast-moving consumer goods manufacturers, particularly those in the milk, cocoa beverages, and pasta production. Nigerians are innovating around everything, and I mean everything. In the majority of families, nobody talks about “three square meals a day” because most families have adjusted to taking late breakfast and early dinner in the bid to survive.

Survive, they might, at the end of the day, but a nearby cemetery is being cleared for the burial of many brands and businesses as a result of this.

Thanks to the dynamics of the market, I cannot remember the last time I saw a tin of Bournvita. But in its stead, there was Milo and Ovaltine. But as we speak, these brands are also disappearing from the breakfast tables of Nigerians. The same goes for milk brands such as Peak, Three Crown, Cowbell, Nano, and a host of others produced and packaged in Nigeria. This is because the locally produced brands have become too expensive, thanks to the bad fortunes of the Naira against the dollar.

In many supermarkets today are shops selling several imported versions that significantly are cheaper than their locally produced versions. Popular brands among families I have discovered include Swiss Miss (cocoa drink), Tropical Sun, and Altunsa (milk powder brands).

The same fate is befalling the pasta business in the country as consumers are increasingly finding the spaghetti and macaroni from the stables of Dangote Flour and Golden Penny comparatively too prohibitive.

Queries among consumers suggest the foreign pasta brands are not of lower cost, but offer other values, including being more filling and containing more packs in each carton. For instance, while the local brands have 20 packs in each carton, the popular foreign brands contain 24 packs. They also say the locally produced brands, unlike their foreign counterparts, are sticky, meaning they contain more starch. Those using it for commercial purposes also believe they “rise more,” meaning they get more servings per pack than the local versions.

All these have also conspired to take the relief route away from the local brands to their foreign counterparts.

We can all see the danger. Flour Mills Nigeria Plc, makers of Golden Penny Flour, employs more than 12,000 people, according to information from the company. On its part, Dangote Flour says it employs more than 3,000 people directly. Many of these people and thousands of others; from those making bags and threads through the thousands of others in the logistics and distribution roles of the production value chain are under the increasing threat of relief road unemployment.

The Nigerian government should move quickly to do something about this before the country grinds to a halt, and the first way to rejig many sectors of this collapsing economy is the oft-criticised route of subsidies.

Unfortunately, the Nigerian leadership has bought wholesale the rhetoric that subsidies are evil. This is not true. If it were, countries such as the United States wouldn’t subsidise its domestic agricultural sector, oil and energy producers, housing giants, automakers, and healthcare practitioners.

Subsidies are not the sort of “giveaway” that successive Nigerian governments have over the years used to reward themselves and their acolytes in the private sector. Serious economies utilise subsidies to lower prices of goods and services and control inflation. They are also used to prevent the long-term decline of industries, as is the case in Nigeria today.

This is not the time to label all voices calling the government to order as enemies of democracy. If nothing is done, this country is headed to a soon-to-come chugging stop.

• business a.m. commits to publishing a diversity of views, opinions and comments. It, therefore, welcomes your reaction to this and any of our articles via email: comment@businessamlive.com