“Chandaria Industries is a Leader in East and Central Africa” says Darshan Chandaria

Interview with Darshan Chandaria, Group CEO and Director of Chandaria Industries

Chandaria Group was established in 1964. Today it is one of the largest and most diversified privately owned groups in East and Central Africa with operations in tissue, paper, hygiene products, packaging, real estate, automobile, mining, energy, etc. Could you give us an overview of the company’s history and main operations?

Our primary business is tissue paper and hygiene products manufacturing. We are also involved with paper manufacturing. We have operations in Kenya, Uganda, Tanzania, India, and Dubai. Our second largest sector is real estate. We also have a joint venture in the insurance sector, in cooperation with Barclays Africa. We own the largest gold mine in Uganda. We are also entering into venture capitalism and private equity. We will soon launch Chandaria Capital, which will focus on SMEs, specifically angel investing and feed capital. We have branched into the automotive manufacturing sector with Mobius Motors. We have also entered into solar energy and flexible packaging.

Currently, we manufacture in Kenya and Tanzania. In Kenya, we operate as Chandaria Industries, Ltd., and in Tanzania we operate as Tanpak Tissues, Ltd. We export our products to twelve African countries. We are the largest integrated tissue paper and hygiene products manufacturer in not only Kenya, but East and Central Africa as well. We have recently announced a 50 million dollar expansion plan. We plan not only to significantly increase our market share in Kenya, but throughout the entire region. We are very proud of being the largest recyclers of paper waste. It makes our business very green and very environmentally sustainable. We look forward to increasing our positive impact in the coming years.

Our brands are market leaders in every segment that we operate in. Velvex is our premium flagship brand, which is very well known across Kenya and East Africa. Our product portfolio includes such brands as Nice & Soft, Toilex, Rosy, and Dawn. We have a rich offering for every segment of the market. Our product portfolio is also quite diverse. In addition to tissue products, we manufacture aluminum foil, cling film, egg trays, and we are the largest manufacturers of hospital-quality cotton wool in East and Central Africa. We have a variety of liquid based products, including liquid hand wash and detergents. In the next few months, we are coming into some very new and exciting categories.

What are some of Chandaria Group’s most significant success stories?

We plan to come out with new products to increase our portfolio. We are working hard to drive this strategy. We want to become a very interesting consumer products base for Kenya and East Africa.

Over the years, we have had quite a few recognitions. We have won Company of the Year in Kenya. Most recently, we were awarded Business of the Year by the Oshwal Community, ahead of quite a few large businesses, which was very exciting for us. Our greatest achievement came last year when we were nominated by the African Business Forum for Company of the Year, alongside groups such as Dangote. For us, it is not about the awards and recognition. It is about transforming lives and being able to give our customers a competitive advantage, day in and day out. We want to ensure that we provide a place where our team and our employees can not only grow financially, but professionally, as well.

Are you involved in CSR?

We are doing a lot of things from a CSR perspective. We do not make a lot of noise about it, but if you follow us, you will see all the activities we are involved in. Healthcare and education are the two most important pillars in everyone’s life. We support over 35 medical and educational institutions across Kenya. Just opposite of our head office is a school that we fund. Over 1500 primary school students go there every day. We built the school and we support it fully in terms of teachers, salaries, fees, and educational materials. Entrepreneurship and SMEs are very close to my heart. I try to give as much of my time as I can to mentorships and talking to SMEs. I am one of the “lions” on the KCB show Lions’ Den, similar to Dragons’ Den or Shark Tank in the US. I am very passionate about seeing entrepreneurs and SMEs being successful, effective and becoming the next big businesses.

The group has operations spread throughout Kenya, Tanzania, Uganda, India and Dubai. How would you define your strategy in terms of expansion plans?

Strategically, Kenya and Tanzania make sense for us. Kenya is part of COMESA and the EAC. From Kenya, we can look after those markets. Tanzania is a member of SADC, which is another trading block. We have just announced a 50 million dollar expansion plan. We will be putting in a brand new, state-of-the-art, world-class tissue paper manufacturing facility. We have plans to expand the production capacity of various other products within our portfolio, as well. We also plan to come out with new products to increase our portfolio. We are working hard to drive this strategy. We want to become a very interesting consumer products base for Kenya and East Africa. Our portfolio will initially aim to capture everything around the washroom. Our primary vision is to be the number one player in Africa for all washroom products and solutions. We also have expansion plans in the real estate sector and the insurance sector with our joint venture with Barclays. We are very optimistic. We are already present in East Africa, Kenya, Uganda, and Tanzania. There is a lot happening for the Group. It is a very exciting time for everyone involved with us.

What challenges does the company face on a daily basis?

We are in an emerging market, so even though we have a growing middle class, growing population, and growing demand, there will always be challenges. The first challenge is infrastructure. Traffic in Nairobi is a bit wild. Our government is putting in place numerous initiatives to develop our road network. Our standard gauge railway is also underway. There are many infrastructure projects planned, it is just a matter of timely execution. Energy requirements in terms of capacity, consistency, and cost are also issues being addressed. Another challenge we have begun to face is unfair competition from Chinese companies. The Kenyan economy needs foreign direct investment. Chinese companies and the Chinese government are supporting us in a big way with long term credit lines that are fairly affordable. But the government needs to monitor these businesses in a way that is sustainable for the economy. Many of these companies are coming in and taking over entire sectors. It is not a level playing field. We are constantly faced with sub-standard products as competition, counterfeiting, and these Chinese companies do not always pay the various taxes, levies, and license fees that we do. That is something that needs to be streamlined. Overall, we are very positive. There is so much happening in Kenya. Every week, we host a delegation from overseas. I am fortunate to be able to be a part of these delegations and interact with these people. It is just a matter of the private sector, the government, and every institution coordinating their efforts towards a common vision. We will definitely create an amazing economy.

How would you describe Chandaria Group’s philosophy and what makes you different from the competition?

We have a long established and successful history. We have been in operation since 1964, more than 52 years of existence. People understand that we are a very established business. We are sustainable. We are growing. Working with us has many benefits. We are the only company in Kenya that manufactures our products 100 percent in Kenya. We are the only fully integrated operation, from paper waste to the distribution of our finished products. We have focused on building brands and on our national development. We are very proud to be one of the largest private sector employers in the country and the region. We want to continue to further our competitive advantage, dominate the market, and maintain our leadership position. This does not happen by only looking at our net profit and our profitability, though. We always work around the concept of the triple bottom line. Being a successful corporate leader means that we have to make sure that every stakeholder, customer, supplier, the community, and the country at large benefit from what we are doing and that we take care of them. My family has done that very well. We are very proud of that. We want to continue that legacy of supporting our community and our country.

What is your vision for the Group and for Kenya in the next five years?

Kenya is a very strategically located country and economy. Anybody who wants to be involved in East and Central Africa will find it very hard to exclude Kenya from their strategic and business plans. We need to understand and capture this situation correctly. We need to make sure that we position ourselves as a responsible economy, as a “big brother” to East and Central Africa. Our government has many initiatives in place to ensure that this happens, from infrastructure, SME development, access to capital, access to funding, technological advancements and the engagement of the international community. We are very fortunate that in the last 18 months, we have had visits by President Obama, the Israeli Prime Minister, and the Prime Minister of India. This is very historical for Kenya in such a short period. The spotlight is definitely on our country. We also need to create better ways of integrating, communicating, and collaborating between the private sector, the government, and the various other institutions that are involved. Private sector players should not keep relying on the government to create development. We need to play our part and continue investing and continue giving international investors confidence. Our Group is in a very unique position in terms of the number of sectors we play in. We also have operations outside of Africa in India and Dubai. Through this, we have the opportunity to see development, modernization, and what the market and the country will look like in the years to come. We are very focused on becoming the number one player in Africa for tissue and hygiene products. We are committed every day to that vision. We are building strong teams and capacity. We are trying to improve our technological adoption and technological advancement. We are continually working to be at the forefront of world-class processes and systems. We will also continue to expand our operations in real estate, insurance, venture capitalism, solar energy, and mining. And we look forward to venturing into a few new sectors, if the opportunity arises. But we will stay committed as Chandaria Group and Chandaria Industries to make sure that we will transform lives in every way we can. Especially through Chandaria Industries, we are very fortunate that we touch the lives of hundreds of millions of people across Africa, every day. We are working hard to make sure our processes are as efficient as possible. In doing this, we can lower the price of commodities and necessities, such as toilet tissue, which will make something as simple as basic hygiene more affordable to Kenyans and Africans in the near future.