SAPICS virtual conference highlights Twiga Foods’ story

July 13, 2020: Kenyan digital startup Twiga Foods story was the highlight of the recent SAPICS virtual conference, hosted by The Professional Body for Supply Chain Management. The Twiga story is also on the line-up for the annual SAPICS Conference that will take place in Cape Town from November 22 - 25, 2020.

Twiga Foods CEO and co-founder Peter Njonjo with Gary Benatar, CEO of Relog, the supply chain and logistics consulting firm that is working with Twiga to optimise its supply chain and logistics infrastructure shared the story with SAPICS.

"If you visit most African cities, you will notice at least two things - the marketplaces and informal retailers that line the streets and the abundance of arable land that the continent is blessed with. However, despite the presence of these two things, food production and distribution are challenges across the continent," Njonjo said. "Most of the consumer spending in Africa happens in informal, roadside markets, even in those countries with the well-developed retail and distribution markets. For many people, these vendors are the main channel by which they access the food and drinks they consume."

According to World Bank Data, 55 percent of disposable income in Kenya and 60 percent in Nigeria is spent on food, compared to 8 percent in the UK.

Gary Benatar, CEO of Relog; and Peter Njonjo, CEO and co-founder, Twiga Foods.

The informality in the retail structure is mirrored in the local food production sector, where 70 percent of Kenya's food comes from the small holder farmer. "The African continent has some of the most ideal conditions for food production in the world; but outdated techniques and poor materials handling means farmers are not getting the maximum returns from their efforts," Njonjo stated.

Twiga's vision is to provide access to low-cost, high-quality food across African cities. It is doing this in Kenya by using mobile technology to aggregate demand in the informal retail sector. Njonjo elaborated, "We are using a mobile-based, cashless platform to aggregate the demand of thousands of small and medium-sized retailers in Kenya, enabling them to order fresh and processed food, as and when needed. We source quality fresh and processed food from thousands of farmers and food manufacturers and deliver from our pack house to more than 35 000 vendors. As a result, farmers and food manufacturers have guaranteed access to a fairly-priced, transparent, mobile marketplace and retailers can consistently source low-cost, quality produce, which is conveniently delivered to their doorstep within 18 hours of ordering."

Benatar said that working with Twiga Foods was an opportunity to learn and develop solutions that progress food distribution methodologies and supply chain philosophies to the informal sector, which has been overlooked in Africa in the past.

The solution designed and developed by Relog and Twiga Foods is unique to Kenya and Twiga. It is delivering lower food costs, less waste and improved sustainability. The facilities developed for Twiga are also a world first, Benatar added. "The design of the distribution centre incorporates FMCG products, other fruit and vegetable products that require grading, weighing and size categorisation into smart crates," he explained. "The facility incorporates smart battery charging for equipment, full returns operations, recycling, and crate washing," he noted.

"Investments in the supply chain and materials handling technology have reduced food waste by 70 percent. The recent roll out of dynamic logistics has resulted in a 50 percent saving on fuel costs. When we look at the Twiga volumes and projections, these outstrip the scale and extent of work we have done for some major retailers in South Africa and around the world," Benatar revealed. "For example, we had to look at developing banana ripening facilities that can produce up to 300 tonnes of ripened bananas per day (roughly 500 pallets per day). Assuming a five-day ripening period, this required a 3,000-pallet capacity in the banana rooms. To maximise efficiency and minimise the costs, significant value engineering was undertaken."

The banana rooms designed have up to 80 2.4 metres high pallets, stacked four pallets high in two rows at 10 pallets deep. "They required the largest airtight doors ever produced. The combination of a new Inventory Management System, RFID enabled assets, radio shuttle technology and state-of-the-art banana ripening software reduces the overall handling cost per pallet," Benatar stated.

Twiga Foods was recently selected from among hundreds of candidates as one of the World Economic Forum's %u2018Technology Pioneers', in recognition of the company's success in leveraging new technologies and innovations to make a significant impact on business and society.

Now in its 42nd successful year, the SAPICS Conference is Africa's leading knowledge sharing and networking event for supply chain professionals.