Wedgehut Foods Limited - Jan/Feb 2023

By Paul Ongeto

We all love chips! Whether as a once-in-a-while guilty indulgence or a perfect lunch date, these long slices of potato that are lightly fried golden always find a way of gracing our meals. The journey to our plate is, however, a long one and involves some not-so-clean steps that most consumers- and increasingly today, processors- would rather avoid. Nobody wants to go through the tedious and dirty process of peeling potatoes. Even the workers at your favorite food service restaurant don’t, or why else would they have you peeling them if, for whatever reason, you fail to pay your bills?

While most of us see this critical step as an inconvenience, Wanjiru Mambo, the Founder and CEO of Wedgehut Foods saw it as an opportunity and has today built an entire business that not only generates income for her but is also a source of employment for 30 other staff. “We are in the value addition of potatoes where we get potatoes as they are from the farmer, do the sorting, the cleaning, the peeling and finally packing,” she says. “The end product is fresh, ready-to-cook potato.”

A PANDEMIC BABY

Wedgehut Foods Limited removes the hassle from the art of making potato chips

Before the Pandemic, if you asked Wanjiru, a marketing graduate and certified public accountant, whether she would see herself doing what she does today, the most probable answer would have been an emphatic No. But Covid created a “new normal” which completely disrupted life as we knew it. For Wanjiru, Covid meant a complete halt to her previous business venture. “I had a restaurant

in Upper Hill that shut down,” she reveals. The restaurant could no longer operate as the Ministry of Health had given an order for all outlets and eateries to close down in an effort to curb the spread of the pandemic.

The closure left Wanjiru with a huge consignment of potatoes that she and her household could not consume. “I started selling them in the estate where I live and that's the same time people were doing panic buying,” she narrates. No sooner had she started than her stock ended. “I went ahead to get some more from Limuru and sold. But then in the process, I was just thinking, what else can you do with potatoes? So that's where the idea of processing and adding value came about.”

BABY STEPS GIVE WAY TO BIG CLIENTS

Enthused with the new business prospect, she approached a friend who had experience processing potatoes for some insights. She got more from the conversation than initially planned. “They were willing to allow me to purchase some of the equipment they had and even set up the company at their space.” With manufacturing sorted, the next challenge was to find clients willing to buy her products. “I was lucky to land one a big client in the name of Naivas,” she reveals. Naivas Supermarkets is one of the largest retail chains in East Africa with over 91 stores as of December 2022. Wanjiru however reveals to us that in the industry where she operates, “people just trust you with small quantities,” at first as they gauge your ability to deliver. In the Naivas case, she reveals that only three branches were assigned to her at first. More were added later as the relationship developed, and she was able to demonstrate the ability to deliver on larger orders. A proud Wanjiru notes that the fact that Naivas is still one of her major clients 2 years after she got her first order from the supermarket chain is proof Wedgehut’s ability to consistently meet customer needs.

Today, Naivas is not the only major brand in Wedgehut’s portfolio. The client list has expanded to include other major brands in the food service industry in Kenya. The clients are categorized into retail, restaurant chains, and institutional clients. Joining Naivas in the retail chain is Quickmart, the second largest supermarket in Kenya. Wanjiru explains to us that Wedgehut products don’t end up on the shelves of these supermarkets. Instead, they are delivered directly to the deli section of the supermarket where they are used to make fries and other potato-based ready-to-eat products for the on-the-go consumer.

If you have enjoyed fried chicken at Chicken Inn or Galitos, chances are that the chips that accompanied them were from Wedgehut foods as Simbisa Brands, the restaurant chain’s parent company is one of Wanjiru’s biggest clients. Simbisa together with Java House Africa form part of the notable brands in WedgeHut Food’s restaurant chains category. The institution’s list includes various prestigious schools like Strathmore and Braeside alongside major hotels including Safari Park, Ole Sereni, and Crowne Plaza.

When it comes to dealing with large clients, Wanjiru tells us the only secret is consistency in the quality of delivered products. She confesses that when setting up, there were challenges, particularly with the packaging, but she made sure that her team did not compromise on what was inside the packaging. “We made sure the quality was good,” She says. Having fewer players also played to Wanjiru’s advantage. “We are not so many processors in the industry and that has worked to our advantage thus far.”

SOURCING THE RIGHT POTATO

The search for the right quality of potatoes had Wanjiru scouting Kenya’s country sides where potatoes are known to be available in abundance. In her scouting escapades, she quickly realized that in the abundance of potato supply lay a scarcity in the availability of potato that was of processing quality. Reason for this market anomaly according to Wanjiru was an information gap. ‘Farmers simply don't understand what a potato for processing is and that has been quite a challenge,” she says. What makes a potato to be of processing quality? I ask. “For us, number one is the size, then the variety,” She answers succinctly. Size is important for WedgeHut as potato chips are the most highly sought after by its clients and these need to be “very good and long enough,” Wanjiru explains. When it comes to variety WedgeHut’s order of preference is Shangi, unica, and Markies. “Shangi and Unica, they are very sweet. Most companies or eateries prefer them because of their sweetness.” Though not her number one choice, Wanjiru describes Markies as a potato variety that is of exceptional processing quality. “It doesn't have deep eyes and thus produces minimal waste during processing.”

Most farmers however don’t always get it right during farming so they end with very small-sized potatoes that are of little use to WedgeHut and most processors. The ugly face of this anomaly showed itself when it was revealed to the media that KFC, an American multinational fast food restaurant chain with a sizeable share of the Kenyan fast food market, was importing potatoes while potatoes were rotting away in Kinangop, one of Kenya’s leading potato producing regions.

Wedgehut, although a small player in the potato value chain, is currently doing its best to try and correct the situation. Wanjiru tells us that her company is one of the members of the Mavuno Zaidi program which seeks to improve the quality of potatoes produced at the farm. The program is led by Sygenta East Africa which educates farmers on the good agricultural practices required to produce processing quality potatoes. Equity Bank, one of the largest financial institutions is also part of the program as a financial partner. “Farmers say the challenge they have when it comes to doing proper farming is money and that is why Equity has come in as the financier,” Wanjiru explains. Other players include Fresh Crop which provides farmers with certified seeds and Yara which supplies fertilizer.

The impact of the program has been phenomenal, both to farmers and processors like Wedge Hut. Wanjiru reveals that the ones who have attended the program now approach farming from an agribusiness point of view. They know the importance of soil testing before farming and the value of crop rotation particularly in maximizing land potential. Access to certified seeds and required fertilizer coupled with financing solutions has also ensured that farmers produce the right quality of potatoes that WedgeHut can use to make its range of products that is not only comprised of potato chips but also Wedges, Cubes, and peeled whole potatoes. Wanjiru reveals to us that about 265 farmers with a combined hectarage of about 3000 hectares are part of her company’s sourcing program. When it comes to sourcing, location is not of importance. “We work with farmers from across the country,” she says. “It just depends on where we are able to get a perfect potato.”

MAKING FOOD QUALITY AND SAFETY A PRIORITY

Wanjiru’s biggest achievement is ensuring consistent adherence to quality and safety. “It has given us mileage and that's what has opened up business for us because when people come and do the vetting or the audits, we always consistently met expectations,” she says. In areas where improvement has been required, she notes that the company has always been open “to learn and evolve and adopt best processing practices.” To achieve this, Wanjiru, a marketer and certified public accountant by profession, has had a lot of learning to do. “It's been quite a learning experience every day,” she says. “I didn't know food is such a huge thing. How you do your processing, how you set up is such a big deal!”

Founder and CEO of Wedge Hut Foods Limited Wanjiru Mambo (Center) flanked by some of her key staff.

She also admits that bringing on board people who have the knowledge on food processing has really helped her get everything right. At Wedgehut, those people include two production managers and one quality assurance officer. She notes that having trained and experienced people in her production and quality department has ensured that each process batch meets the necessary quality and safety specifications. Her team also comes in handy particularly in enabling the business to adopt and implement food quality and safety recommendations given by clients.

Wanjiru is also glad to have such an impressive team of food technologists as it relieves her of the responsibility to handle customer complaints while also giving her the reassurance that it will be handled in the most competent way. “I don’t respond directly to customer complaints,” she says. “The person in charge of quality assurance writes back to clients from a quality perspective complete with recommendations.” Clients will always say they are right, but Wanjiru reveals that at times they could be the ones having issues, and with a competent team, Wedghut is always in a position to give recommendations on possible corrective actions to take.

A FOCUS ON CASH CLIENTS

In any business, cash is King. But in the market where Wedgehut operates, the Queen in form of credit runs the streets. Wanjiru reveals that while farmers expect prompt payment for their produce, Wedgehut customers operate in a credit system where payment is made between 30 and 45 days. This greatly creates cashflow issues for the upstart company. A shrewd business lady, Wanjiru is turning her focus to a new category of clients: Cash clients. She explains to us that this category is comprised of smaller restaurants that are coming up, especially in the upmarket which normally take a shorter credit cycle of between 7 and 14 days. She sees a lot of potential in this avenue as most of these businesses are opening up in spaces such as top floors of buildings where space is very limited. “Because of how potatoes are processed, the peeling is a bit hectic and it's a very dirty process,” Wanjiru explains. “So the best thing is to just get ready to cook potatoes” and that’s where Wedgehut comes in.

The company has also opened up a directto-consumer channel that delivers small orders from as low as 3 kilograms per order. These ones pay in cash and are particularly critical in balancing the cash flow. Digital has been the main channel for reaching these clients with the company already having a significant following across its social media channels including Facebook and Instagram. These clients have also turned out to be very valuable when it comes to referrals. “Sometimes a customer samples our product and its works very well for them and they end up recommending you to a hotel or hotel owner. Other times it’s a chef who sampled for his own personal use but ends up recommending us at their workplace because they liked the product we offered.”

THERE IS MONEY TO BE MADE FROM POTATO

The potato business, despite its various challenges, has proved to be very lucrative for Wanjiru. With the performance so far, She believes that there is more money to be made in from potatoes as demand for chips and other potato products expands. She forecasts that with the current trends, potato is well on its way to overtaking Maize as Kenya’s mostconsumed food product. “Look at our kids,” she poses. “Not so many will go and ask for Ugali in a restaurant, but you find people asking for potatoes.”

Given its potential, Wanjiru would love to see more farmers give potato farming the attention it deserves. Already, a crop is emerging of young, well-educated farmers going back to the rural areas to do potato farming. Given their exposure, Wanjiru notes that this group of farmers is opting to adopt proper farming methods right from the start which has helped improve their revenues. More farmers need to join to ensure that the country has an adequate supply of good-quality potatoes. She notes that if done right,”you can actually make more than just enough to feed your family. You can even make money for school fees and other things.”

HUNT FOR A STRATEGIC PARTNER IS ON

As the market for potatoes continues to rapidly expand, Wanjiru wants her company to continue playing an increasingly important role in the value chain. So far the company has been taking an organic approach when it comes to growth. “We have been upgrading as we go,” she says. “When operating at full capacity, we can do even ten tonnes in a day.” The goal is to however be in the big leagues. She tells us that getting in that arena involves bringing on board technologies like automation for consistency, efficiency, and food safety. “We're looking at also doing the frozen line which is in demand right now,” she reveals. “The government has taxed heavily people who are importing, so if we can do it locally, we are at an advantage.” Wedgehut also has plans to enter into the potato flour business. The flour not only brings in revenue but also “sorts out some of the waste.” Starch, one of her biggest headaches “because its forms a gummy thing that blocks waste stream pipes,” could also be turned into a revenue generating product. Finding a way to process that would actually be of great benefit to her zero-waste strategy. “So that's where we are looking forward to and we hope we can get strategic investors to help us get there.”