Ugandan skin-care brand seeking to steal market share from multinationals

Siki 600x300

Siki Kigongo

Four years ago Ugandan communications specialist Siki Kigongo founded Amagara Skincare, a manufacturer of natural personal-care products. The business was motivated by her experiences while living in the UK. During holidays she would bring home beauty products as gifts.

“Friends and family were always delighted, but I started wondering why we had to bring these products from abroad, yet Uganda has all the raw materials needed to make high-quality cosmetics and beauty products.”

Kigongo enlisted the help of local scientists to develop products made from the extracts of fruits, vegetables and other plant materials. Today Amagara offers body lotions, body butters, hand creams, shower gels and hand wash.

The products are all manufactured at the Uganda Industrial Research Institute in Kampala, but some of the packaging is sourced from China.

“Our target customers are people aged between 25 and 45 who don’t necessarily have a big budget but want to look their best and take good care of their skin. It tends to be people in the middle to upper-class income bracket who are a bit more exposed. A few years ago this was a very small demographic, but the numbers are growing gradually,” says Kigongo.

“The challenge is that this demographic has several products aimed towards them, particularly international brands. Many Ugandans believe what is imported is better than the local options. So our biggest competition are international brands like Nivea, Revlon [and] L’Oréal.

“We are trying to change people’s mindsets by giving them international standards – but produced locally.”

Kigongo says Amagara is available in major towns across Uganda, stocked in local supermarkets, pharmacies, boutique stores, spas and hotels. Outside Kampala, the company is recording good performance in the northern city of Gulu, and Masindi in the western region.

“In these areas you find lots of international companies and NGOs. So people buying our products in these areas tend to be expatriates,” she explains.

The products are also available on two e-commerce sites, but Kigongo says consumer response has not been what she’d hoped for.

“Online buying still isn’t a big thing in Uganda. We are not selling online as much as we would want to. But I have faith in a few years it will pick up – but at the moment e-commerce is not working miracles for us.”

Expanding to meet demand

Amagara is set to move from its current production facility to a bigger space just outside Kampala within the next 12 months.

“We will bring in additional machinery to produce more and satisfy the growing demand. Previously people weren’t as concerned about the kind of beauty products they used, but today there is a growing interest in natural and organic cosmetics, which is very encouraging for manufacturers like us. Consumers are also more willing to try new things – perhaps due to the availability of more brands than a few years ago when there were limited options,” she explains.

“Right now we make 500 litres of product per week, but after we move to the new factory we should be able to double, even triple that. We will hire more scientists and have more resources to experiment on new products. We would like to try out face creams and anti-ageing products.”

Competing with other local brands

International brands are the biggest competition for Amagara, but Kigongo says there are some well-performing local companies to watch. She singles out Samona and Movit, both established manufactures of beauty products, making everything from shampoo to soaps to body lotions. They offer affordable pricing, have strong distribution networks, and invest significantly in marketing.

“Samona and Movit sell at very low prices so when consumers see our products they think we are too niche. So one of the challenges we face is gaining the loyalty that consumers – particularly women – have towards certain skin-care products. When we launched we had great presence and people were talking about it, but four years later we are not as recognised – perhaps because of a lack of marketing,” she says.

However, Kigongo adds it is encouraging to see more local manufactures entering the beauty and cosmetics market.

“There has been a surge of low-cost, low-quality products targeted at the mass market. Their target clientele and ours differ greatly, but the investment into beauty and cosmetics by local companies is an encouraging trend. I am glad local companies are making use of the raw materials available here to develop products.”