Dried Mangos – How to survive the price war

Mamusa Marketing is a classic example of South African entrepreneurship. The prime supplier of dried mangos and other dried fruit has been under pressure recently as more companies are entering the market from various African countries. Axel Breuer talked to Elmien De Villiers, founder of Mamusa Marketing from Pietermaritzburg, South Africa.

Please let us know some facts about your company.

We founded the company on May 1, 1997. So we are in business for over 20 years now. I was a teacher before that. With the new democracy in South Africa the country was drastically changing the teacher’s workforce. I had the choice to be retrenched with a single payment. I took the money to found the company. Being a teacher with no background in agriculture or agricultural trade you have to learn some lessons. In 1997, I

traveled to Switzerland for brainstorming what I could do after my career as a teacher. In 1998, I visited the South African Embassy in Switzerland and I asked about potential trade items between South Africa and Switzerland. They suggested to start trading dried mango. I started looking for producers of dried mango in South Africa and I found reliable partners. I knew Switzerland a little bit and I knocked on the door of Coop and Migros, the two largest retailers in the country. Migros was the first to buy mango and the first shipment was 5 t of mango. We later learned that the goods were withdrawn from the shelves.

At the time we added sugar and it became clear that the consumers were looking for sugar-free dried mangos. From the minute the product was delivered without sugar it started growing. At this time Migros was a partner for growth in South Africa and our retail client. In 1999 there was a big flood in South Africa and consequently we were not able to export. But in 2000 the company was really taking off. In 2004 we already exported 250 t of dreid mangos to Switzerland. As the business grew we also started to deliver to the UK. Every time the demand exceeded the supply. Only in 2016 and in 2017 the supply in South Africa exceeded the demand. Today the company exports 340-450 t per year.

What happened after this successful start?

South Africa was for many years the leader in the dried mango business. The World Bank recognized the potential of mango for job creation. So the Bank started funding projects in Ghana, Burkina Faso, Ivory Coast, and Gambia… That whole development meant that South Africa was losing its market share for the product.

That means that you had to compete against a subsidized industry without any subsidies for yourself?

Correct. In a way it’s an unfair competition because they were funded by the World Bank and we had to fund ourselves. The Bank even asked us if we can take part in a survey to help the funding of new businesses in the dried mango sector. Some of the South African companies actually engaged in dried mango production in Burkina Faso with the help of the World Bank. They created their own competition. For example: We pay much higher wages than producers in West Africa to our workers but we cannot get Fair Trade accreditation, because there are a lot of criteria that we have to meet and we do not qualify.

Do you get help?

Not at all. Our government is actually working against us, not for us.

What do you do to stay ahead in the game?

We have to develop new markets. In 2016 a price war started. We predicted that the dried mangos from South Africa would arrive even 3 or 4 years ago. But in the 2016 the prices were really pushed down and the South African industry was in trouble. We still had a lot of stock in the middle of the season. But then the news arrived that the West African suppliers did not meet the expectations of the buyers. So we managed to clear our stock. The 2018