Fresh Cuts Limited: The Meat Processing Industry in Uganda by Amos Tindyebwa

Interview with Amos Tindyebwa, Managing Director of Fresh Cuts Limited

What is your assessment of the meat sector in Uganda? What are the latest trends?

Uganda’s meat sector is very lucrative. Uganda enjoys a comparative advantage in livestock production. We have more than 10 million heads of cattle, more than 10 million goats, more than 10 million sheep, and a huge number of poultry. Across the board, we have a very lively livestock sector. The potential for the sector is very high. The market demand is also very high, not only in Uganda but all the neighboring countries as well. The Ugandan market is not sufficiently served and, more importantly, not sufficiently served with high quality meat. There are a number of commercial farmers who keep animals on a commercial scale, but we have a significant subsistence livestock segment in the industry. Sometimes this leads to a shortage of supply. The government has been putting emphasis on encouraging commercialization so that we can be assured of our supply. Now, we have to focus on the quality that we get from the farmers. The sector is doing well and it is promising. The agriculture industry is much more impressive than even the oil industry. My background has been in other areas of business and exports rather than agriculture, but with the time I have put into agriculture and value addition it has been very interesting.

Is the environment competitive?

We process any kind of poultry and livestock products. We are the only one stop shop where you can find all manner of quality products in meat, fish, and poultry.

Fresh Cuts remains an elite company in our segment. I call the other players “market distortions” rather than competitors. We are the only company with automated processing and high technology processing for value addition in meat processing. We do professional butchering. We are the only company which can produce a range of more than 100 value added meat products. We are the only company that has the kind of machinery that we have. We have distortions coming from poor players and those not meeting the same standards that still play in the same market. There are those that want to import meat that we have available in Uganda from other countries. But we have established ourselves to meet that challenge and compete favorably. However, we cannot compete where the regulations do not control these unfair distortions. For instance, if Fresh Cuts is producing a wide range of sausage products and they are certified by the Uganda National Bureau of Standards, we expect every player to be able to meet this kind of standard to put it on the supermarket shelves. But if the regulators do not enforce this, then there is distortion in the market. We are playing a fair game where other players are not. But these unfair players do not usually survive for long because the cost of non-compliance is higher than the cost of compliance.

How do you sell your products? Who are your clients? Are they wholesalers or do you sell directly to the hotel and restaurant industry, exporters, etc.?

Fresh Cuts’ selling philosophy is centered on quality. We target a wide range of customers. We run our own outlets which we classify on the Quality Cuts Butcheries which is our premium brand. The main clients are international such as expatriates, people working in foreign missions, as well as the high-income earners in Uganda. Our second segment of clients are corporate companies or hotels such as Sheraton, Serena, Hilton, Protea, etc. The third segment is the high-end supermarkets. Finally, we serve the general public. We are the lead supplier of all types of sausages. The other main segment is the export market. We export meat to almost all the countries in the region including DRC, South Sudan, Rwanda previously, Tanzania. Our biggest customer in this region is the UN operations. They have a large fleet of logistics and operations in the Entebbe region and they have been one of our main clients. We also supply the mineral service logistics in the oil and petroleum belt in southwestern Uganda. There are many multinational companies operating in that region and we are the main supplier of meat products to those operations. Currently, we are exploring an opportunity to export to the Middle East. We are in discussions with some potential buyers now. We are also looking at Belgium because Fresh Cuts is able to meet those export standards. We are an ISO certified company. We are also halal certified. We are the only company in Uganda and the East African region that measures up to that standard.

Are you looking for technological partnerships?

We are always looking to improve our equipment and we are in a number of partnerships with companies in Europe and South Africa who appraise us on technological advancement. We also participate in fairs in Europe where we are acquainted with the state of technology in meat processing and value addition. We regularly update ourselves. We even have expatriates come from Spain, Europe, South Africa, France to upgrade our technology every year. We are currently trying to partner with some people from the Netherlands to introduce new products to the market which are vegetarian sausages. This is a new way of delivering to the market and continuing to meet the expectations of the market. Now, customers are looking for healthier options and plant-based protein rather than beef-based protein. So, we are also adapting to those kinds of consumers.

What are your major products?

We produce quite a wide range of products. We process a variety of beef related products. We have more than 50 professional beef cuts. We produce about 12 types of sausages from beef to chicken to turkey, spices, mushroom, etc. We have European frankfurters as well. We also do specialties in chicken, fish, turkey. We process any kind of poultry and livestock products. We are the only one stop shop where you can find all manner of quality products in meat, fish, and poultry.

What are some success stories you are proud of?

We have been able to build and sustain our Quality Cuts and Fresh Cuts brands. We have been continuously improving these brands for the last 15 years. Secondly, we have been able to serve the Ugandan public. We are able to tailor our products to meet the demands of the lower income earners. We produce approximately 5 tons of sausages every day and they are all consumed by the local public. We have been able to use our sausage to create employment for people and to guarantee food security. They can access the sausage, but also enter into the distribution chain, the marketing chain, and generate income. We have also been able to encourage farmers to have good farming practices. Fresh Cuts emphasizes traceability in our sourcing practices. We have encouraged farmers to keep records about their farming practices. They are able to tell us what kind of breeds they keep, what kind of animal management they do, what kind of waste disposal practices they have, and what kind of records they keep at the farm to guarantee our consumer that they are getting a healthy, clean product that meets the demands of the export market. We have now begun to encourage farmers to do farming based on calculations of how much they invest and how much they get out. They may have a large piece of land but only have a few cattle. The return on investment is not there. You can now make use of two acres of land and your returns are 80%. We encourage farmers to make better use of their land to protect the environment and get more returns for the farmer.

How do you see the company in two to three years’ time? What do you want to achieve?

I want to see our presence in the export market strengthened. We want to enter the regional and Middle East export market. These are classified as relatively soft markets which we can target for the medium term and they are logistically possible for us to reach. The Middle East has already expressed great demand in our products as have the regional markets of Eastern Africa and Western Africa. We have had demand expressed from Senegal and Mali as well. For the long term, we want to target the European market and we are already in discussion with potential buyers in the EU. We also want to create a sustainable supply chain. The biggest challenge is that livestock is a seasonal supply in Uganda. As a continuing business, we want to be guaranteed continuous supply. We are looking at participating directly in the value chain and having sustainable suppliers we can work with capacity building either through farming cooperatives or contract farmers. We are going around the country to discuss with potential farmers who can contract with us to produce and supply us. This will guarantee us the supply that we want because there is continuous expansion of demand and the market is very big. We have not been able to adequately supply the market because the value chain is not adequate yet.

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