“No mountain is too much of a challenge to me,” says 38-year-old Kenyan entrepreneur Romal Shah. Six years ago, at the onset of the global economic recession, Shah quit his job in the UK, ending a 10-year career in corporate banking.
Shah was demoralised by the fact that the stringent credit controls that were being introduced at the bank made it difficult to lend to corporate clients with whom he had built relationships over many years.
“I came back to Kenya in 2007 [but] I had nothing planned as to what I was going to do,” said Shah.
Thanks to his interest in the hospitality industry, Shah helped investors make hotel acquisitions in Kenya as he tried to figure out what to do next.
“Slowly I started meeting people at the golf course. One of the people I met introduced me to a lot of people in the tea industry. I went in thinking we need to do value addition in Kenya. I wanted to do value addition in such a way that a Kenyan tea or coffee is recognisable as Kenyan, not blended with so many other things.”
Shah began learning more about the market and quickly worked out that he could not enter the industry at the farming and brokerage levels.
“Farming is a very difficult world to be in because crops can fail. There are so many external factors you can’t control. Price as well; a lot of coffee pricing is determined by US commodities exchanges. You can’t have control over that.”
Shah then started Tea and Coffee Connection and began producing his own coffee brand, Safari Lounge, which he sold in the UK. Tea and Coffee Connection did good business, distributing its products to health food stores until the recession hit in 2008.
“When there is no spending power in the economy, health food stores [are the first to get hit]. Every week they were closing down four or five stores that I was supplying to.”
Not one to give up easily, Shah decided to shift his focus to Kenya where he noticed a gap in the market: hotels were getting “sweepings off the floor” and not the best quality tea.
“Good quality coffee and tea gets exported. We are left with mediocre level coffee. There are a lot of four star and five star hotels in Kenya and they want orthodox tea, which is higher-end tea.”
Shah approached a few hotels and eventually convinced one regional chain to try out his products. Getting Safari Lounge into the hotel chain was not an easy task because the hotel had been served by a local company for over two decades.
The association with a big hotel brand worked to Safari Lounge’s advantage, and Shah used that platform to begin doing business with other chain hotels.
“We’ve got a lot of exposure through all these hotels. Everyone opening up a new hotel is suddenly enquiring with us.”
Filling a gap in the market
According to Shah, the firm’s success in breaking into a market that was controlled by one dominant player for decades was driven by his belief that “nothing is impossible”.
“There is a market for every single product, provided you find a unique selling point [and] gap in the market. There is always a gap in the market. The big boys are not always models, the big boys are not always doing things right. The minute they become classed as the big boys, service levels drop, complacency comes in [and] quality is not always what it was before.”