Kenyan entrepreneur ventures into competitive processed meat industry

Peter Njonjo

Peter Njonjo

Peter Njonjo’s business was inspired by backyard barbecues with his friends. During these gatherings they lamented the lack of quality processed meats available in the Kenyan market, and would come up with their own recipes – like bacon-and-beef burgers and grilled bacon-wrapped chicken legs.

In 2014, after years of toying with the idea of starting his own processed meat company, Njonjo finally left his top IT job to start Gregos Foods.

At first Njonjo spent his time researching the market, refining recipes and sourcing ingredients. He also gathered customer feedback on proposed products that eventually led to the proprietary “Gregos pre-mix”, which Peter describes as the magic recipe giving his products the edge.

Seven months later he switched on the factory, and today the company’s range includes sausages, burgers and bacon as well as fresh-cut pork and beef.

With the high cost of establishing a factory, Njonjo was lucky to find an existing plant that had been operating below capacity, and was available for lease. This significantly lowered his start-up costs.

He also asked his friends to assist in areas where he didn’t have the required expertise. “My network of friends generously offered their services when I needed a professional eye in finance, human resources, marketing and general business advice. By tapping into their expertise, I was able to get good direction and also saved on the initial business set-up costs of having to hire business consultants or experienced employees.”

The factory is located in Kikuyu, an agricultural town about 20km from Nairobi. Operating costs here are lower than in the capital, and it also puts the company in closer proximity to meat producers.

Penetrating the market

According to Euromonitor, the Kenyan processed meat industry is dominated by Farmer’s Choice with 44% share of the market, followed by a handful of other players.

This situation makes it especially tough for Gregos Foods, as the market leader already has significant prominence, visibility and customer loyalty. Over the years a number of newcomers have tried to crack market, but had to close shop due to poor sales.

Peter explains, “Initially we relied on social media, word of mouth and experiential events to drive consideration. As more and more people got converted, our sales continued to increase. We started by doing home and office deliveries before venturing into the retail stores. Once we got into the retail stores, we used in-store activations and ‘buy one, get one’ product promotions to drive sales.”

The company also works with food bloggers and influencers to drive awareness.

Increasing capacity

Gregos is currently expanding its manufacturing capacity to keep up with growing demand, especially in the wholesale (catering to hotels and restaurants) and the export market.

Due to the high cost of debt, it is considering to partner with a private equity firm to help finance its capital expenditure.

In addition, the company is also looking at expanding to other African countries, as well as introducing new products.