Health Sector in Kenya: An Overview of Laboratory Equipment Supplier Chemoquip Limited

Interview with Feroz Nawab, CEO of Chemoquip Limited

What is your assessment of the laboratory equipment sector? Is the environment competitive?

Unfortunately, it has not been very competitive because the playing fields are not even. There is favoritism in the tender business, importation delays that cause shortages of items, and issues with the availability of products. Registration is always a problem and new rules and regulations keep coming in overnight. Those are some of the issues we are trying to overcome to make things more available. We are trying to use the media, the healthcare sector, the Ministers, other industries, and the other healthcare players who are in the government sector trying to campaign and tell them there is a shortage. Recently, there was a press article on the shortages of products in government hospitals. They need to be more flexible to make the importation of goods easier.

What is the cause of this issue?

We do laboratory-based hospital supplies. Chemoquip started 25 years ago in the hospital sector. A few years ago, we expanded into the food, dairy, and pharmaceuticals industries. Anywhere there is a lab (human, food, or any industry) we are in that space.

The government is trying to avoid bringing substandard goods into the country, but they are going about it the wrong way. They are comparing other first world countries to third world countries. In this market it is not possible to do that. You need to start with simple requirements that are easy to manage, and then make our way up. There is more scrutiny now and more documentation. Some documents are required by the Kenyan government that the first world countries have never even come across, so the physical inspection takes much longer. There are also only a handful of companies and people that are authorized to do the physical inspection, so delays happen. Shipment time now takes almost 12 to 16 weeks. Before, we could bring shipments in in 4 weeks. Our turnaround time is less and the availability of the goods causes a shortage of the items. These items have a shelf life of between 12 to 18 months and the inspection cannot be done prior to the order. The goods have to be ready and then the inspection takes place. So, we lose almost two months of the shelf life of the products. But the customer wants 75% shelf life from when the product is manufactured.

What other challenges do you face?

We are dealing with challenges of importation, finance, the government not paying suppliers, suppliers not paying importers. We are also being forced to use railways. Before, we used to bring in a clear container within two or three days. Now, with the government forcing us to use the standard gauge railway line, we have to bring in our goods by railway, whether you own a truck or not. That takes up to an additional 10 days and then the clearing in Nairobi. That is causing an additional delay and the goods are perishable. There are quite a few suppliers, but the playing fields are not level because the orders are subject to favoritism. Greasing of palms and unethical business practices do happen a lot. We stay away from all that. We are happy to supply to our distributor, but that is all.

What are your competitive advantages? What do you bring to the market that is different? How do you distinguish yourself from the competition?

We have a very good dedicated team and we understand what our clients are looking for and what their needs are. We have quality products, we provide backup services and training, free transportation depending on the item, and regular checkups on the product. We have a good ISO team that checks up on the goods whenever there is a complaint. We have a strong technical team that looks after the products we supply and we try to ensure that all our products are working.

What do you supply?

We do laboratory-based hospital supplies. Chemoquip started 25 years ago in the hospital sector. A few years ago, we expanded into the food, dairy, and pharmaceuticals industries. Anywhere there is a lab (human, food, or any industry) we are in that space.

How do you supply to the market? Why should the distributors go to you instead of another company?

We have a marketing team that markets our products to the end user. In every part of Kenya, we have a distributor who also markets our products to the user. We offer special pricing and bonuses to the distributors. So, the user does not have to come to Chemoquip. The hospital in a certain town may have a very good relationship with our distributor in terms of payment terms and we offer special prices so they all find it easier. Our products are well marketed to the user so the distributor does not have to waste time or do anything extra when it comes to marketing. That is all taken care of by us. The backup services and aftersales service is all totally handled by us.

Do you work only in Kenya?

Chemoquip is 25 years old. About 10 or 12 years ago, we started Chemoquip Tanzania. We have a very good team over there and it is running well. We also have sub distributors in Uganda and Tanzania. Tanzania is quite large so Chemoquip Tanzania only looks after Dar es Salaam and its environment. From Kenya, we handle Arusha and other parts of Tanzania. We have distributors in Rwanda, Uganda, Malawi. We are not as active in DRC Congo and Burundi because of the instability in those countries.

Is this just a small part of your business?

Our main focus has been Kenya and we are now trying to increase the export market through either the distributor or the existing Chemoquip office.

You are currently going through a rebranding. What are you doing in this process?

We put up a new Chemoquip building which is double the size of our current location. It is an ideal location. Parking is not a problem. It will offer some backup technical services and also teaching. We are changing our whole corporate image on who we are, what we do, corporate logos, branding, etc. We are rebranding to create a visual identity to reflect our values such as our experience in the industry, our diverse product range, our aim to advance industry standards, encourage entrepreneurship, empower employees and customers, and strive to improve through sustainable practices. We want to provide high quality products to our customers. We want them to be long lasting and not something that just lasts a few hours or days. We ensure that we are dealing with companies that have good ISO backgrounds, offer backup services, and quality products.

How many products do you supply?

Our product range is huge. We have over 3,000 products. We supply to food, fish, dairy, and human labs. The product range is always increasing. We ensure that the customer needs are met and try to make sure that we are a one stop laboratory supplier.

How have the industry standards changed in Kenya?

For a long time, we had literally no standards in Kenya. Most of the food and products we were eating in this country were not tested at all. Now, the philosophy is changing. You cannot start a milling company without having certain standards. These things need to be addressed to make sure that the end user and the people in the industry understand this. As we improve on those standards, it opens up the market for us to actually sell our products to that particular region because there is a void there that someone must fill. We are planning to address these standards so we make sure that as we answer the questions with regard to quality, food testing, product selling, soaps, food, chemicals, drugs, etc., being made, that we are training the end user on the importance of making sure the products they use have consistency and that they are the same product tomorrow and the day after. To do that, we have to train the people who are actually doing it to understand this, in essence, creating business for ourselves.

What is the importance for you of this training?

The importance of training is to first ensure that the equipment is used correctly by the user. Secondly, when you do a test or an analysis for a hospital or in the food industry or the farm industry, they want to get readability. All that is acquired through quality equipment, quality backup, quality training, technical training, etc. It is correct measures, understanding the clients and the customers’ needs, and what they want to test when they start up an industry. It is important to have a quality product when you start anything.

You are engaging in sustainable CSR initiatives and practices. Can you explain more?

On that field, we are supporting a number of hospitals and clinics by providing medical testing equipment for agents who in return test free of charge for those that are less fortunate. We are tree planting. It is obvious what is happening to the environment. Our main focus has been on our medical camps. We help the hospitals to reach out to places where we cannot. They provide free medical testing and centers.

How are you encouraging entrepreneurship?

We provide our quality products to various industries, from a small clinic that is only ten beds to a big industry with 6,000 people. Based on our quality products, we are able to cater to every sector and every size for quality testing products.

Are you looking to attract technological improvements or partnerships?

We currently are looking for partners. We are rebranding and trying to ensure that everything in terms of services and quality remains up to standard in our new facilities. Therefore, we are looking for people who can come in and invest in technology transfers and help us on this journey.

Are you also interested in attracting interest from funds on the financial side?

We are interested in that. Because of the new location, new products, and new services we will be rolling out, we will require some financial assistance and some kind of equity funding.

Project yourself to the medium term, two to three years’ time. What do you want to have achieved? What is your vision for the company?

Currently, our focus is to increase our product range to ensure that we have an increase in quality products throughout the sector. We are also planning on going into something new with organic farming. We are still discussing planning for that product. We are also interested in educational products. A lot of things are not done practically. That is a new sector we have just started. We have had a few trainings in the universities of Nairobi where they have small, affordable teaching kits that the students can actually get their hands on as opposed to just reading and then not being able to understand when they actually have to use that product. That is our new vision.

What will Chemoquip be in five or ten years’ time?

We want to change the way the industry does business, especially the way lab equipment is handled. Even the working environment we are changing, such as the storage of chemicals. People should come to us and not only see what we are selling but how we deal with our products and store them. We want to teach the students in the institutions. They need to be trained on how to properly use the equipment. The aim is to put that idea into their knowledge so that when they are out there, they can correctly use the equipment and do better analysis in every sector. By this knowledge, we will actually expand our business much quicker in the next five years. We want to be the brand that you think of when you need any laboratory items across industries.

FAIR USE POLICY
This material (including media content) may not be published, broadcasted, rewritten, or redistributed. However, linking directly to the page (including the source, i.e. Marcopolis.net) is permitted and encouraged.