Folu & Bose Ayeni – Tantalizers


Folu & Bose Ayeni are co-founders of Tantalizers, Nigeria’s fastest growing fast food chain with Folu Ayeni, CEO of Tantalizers. In 1997 when they produced the blueprint for their business, Ayeni and his wife, Bose, knew the odds were against them. Raising the start-up capital of N2.5 million seemed a wishful thought, going by the reputation of Nigerian banks in giving loans to business start ups. They were not disappointed. Banks shut their doors on them, but they held unto their dream. Today, these same banks spruce up their sweet-talking business executives and send them after Ayeni, offering all kinds of financial support.

At the beginning, when they took their proposal to their bankers, their bankers told them they did not finance such businesses. They never gave up hope. They persisted until the then Prudent Bank (now Skye Bank) decided to take a chance on their dreams. This paid of handsomely.

Today, Tantalizers has more than 30 outlets nation-wide and are now looking beyond Nigeria. We plan to expand to the West Coast, South Africa and the United Kingdom.

The husband and wife team run Tantalizers, which is low listed in the Nigerian Stock market as a public limited liability company. The International Finance Corporation (IFC), and arm of the World Bank in February 2010 granted $7Million in loans and took $1.5Million equity in Tantalizers to help take the company to the next level. This will be used to upgrade about 15 outlets and build more new outlets. From looking for a N2.5million start up capital in 1997, the husband and wife team has grown a company which has become a national brand and institution in Nigeria.

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The Tantalizer Story
My grandma sold rice, mum sold rice, and I also do because my teacher advised me to stick to family business…

“In my final year in the business school, there was this lecturer some of us asked what kind of business to go into after graduation.
“Because we had this fantastic MBA certificate, he looked at us and smiled, saying “if you are not Bill Gates, if you have not invented something that you can patent immediately, I will advise you to go into a business that your mother or father did successfully. Now apply your newly acquired knowledge from the MBA class and make it a better business. That was the opening comment of Mr. Folu Ayeni, Managing Director Tantalizers Nigeria Limited in a discussion.

That is why today I am selling rice and beans. My mother sold rice, my grand mother sold rice and so I am selling rice. So don’t go into business unless you have competitive advantage. That is what you have and other people don’t have and that becomes your strong point.

When we started Tantalizers, we invested N2.5 million and information at my disposal from our auditors is that our gross profit is about N4 billion for the financial year which will be published in few weeks time, but how much did we invest in the business when we started?
It is usual for SMEs to blame the infrastructure, the lack of knowledge on feasibility study, the banks and a host of other things considered to be limitations.

Ayeni said, I have seen a lot of Small and Medium Scale Entrepreneurs (SMEs) go down with wonderful ideas, just because of the short sight limitations. Limitations of finance, collateral etc. and what I want to tell such people is that: You don’t win a lottery by wishing, you win lottery by first buying the ticket, like every other person that is expecting a win. You might or might not win but the first step is to buy the ticket.

SME Operators
I am not going to blame the governments over lack of infrastructure, or the banks for lack of finance options for the SMEs, though I still have an ongoing battle with the banks. No doubt, the government is not making anything easy for the SME. Take a look at the state of the infrastructure in the country, which is in the worst possible way.
What are the goals of the SME operator in Nigeria, what are the responsibilities an SME operator needs to take up to be successful? The Nigerian entrepreneur; is just like a goal keeper who was asked why did you allow so much balls into the net, his response was “ “whenever the opposing side striker shoots the ball towards the net, the ball turns to three balls and I don’t know which one to catch and that is why we were defeated with so large a margin.
The coach now responds that: “if you had just caught just one of the three balls, we will be able to register it. That there were actually three balls and two landed in the net while the keeper was able to catch one of them and here is the evidence but now that you have caught none, your story sounds unbelievable. That is just the way a typical Nigerian entrepreneur paints the challenges facing his or her success.
But if you play your role properly as an SME operator then you are probably going to end up succeeding, and that will enable us to focus on the bank and the government who are not playing their roles adequately in developing the SME project in Nigeria.

Tantalizers’ Experience
The Tantalizers’ experience is real because I went through the mill. What I am going to say is not something I got from one SME bookshelf, but practical life experience. The summary of it all is that we survived by the grace of God. It was not everything I know now that I knew then. If I had known half of what I know now things would have been much easier.
Go and start, don’t talk about finance, start first and everything starts with an idea. Money in most cases follows good idea and that is the reason you must start first. Don’t wait until you are sure of a loan without collateral. If you are waiting for that you may never start anything.

Selecting Business
Look into your environment, look at what you can do that is very good, a lot of people choose a line of business just because they saw somebody succeeding in that line of business and they join the fray without knowing what actually is going on in the business. You see somebody establish business and you don’t know if it is financed with money from 419 deals, you also open a similar business. The objective is not to make profit but to launder money, so you must first know and understand the business you want to start.
Do an objective appraisal of the business and know if is it easy to start the business, and extent of capital needed. I know someone who wanted to start a consultancy outfit, he came to Victoria Island to hire an apartment and furnished it to taste without a single client, and six months later he was bankrupt because he had no single client to call a customer. He could not get a single consultancy job to do and all his investment went down the drain.
He failed because before the business started he had a bloated overhead which the business cannot sustain. As an SME, start small and don’t build unnecessary overhead into your budget. Allow one person to play several roles. When we started my wife was the managing director and the production manager. She wakes up about 5am to go to Mile 12 to buy tomatoes and other raw materials. She will be back in Festac before 8 am, then we will prepare the meal, get to the cash point and by 9 pm she will do the account. Those days we made about N11, 000 everyday.
Subsequently, we started putting in structures though crude and rudimentary.

Plan Growth
If you are successful in one outlet then you must build another, but look before you leap. That you are successful in one area does not translate to automatic success in another area, so there is need to plan for what you are going to do. This is where wisdom is necessary. If you are opening business in a new location you must look at the business environment from the angle of your strength and weakness there. If your weakness outweighs your strength and you must be there, then you must strategies on how to penetrate the market or you may run into problem.

Buy Expertise
You can’t know everything or do everything. You cannot do the job of four persons. The major problem of the SME is keeping proper account books. We clocked 10 last year and it is still one of our problems. We get accounting software and people don’t still know how to use it, rudimentary bookkeeping for some SMEs is not there. All they do is sell some and consume some of the product they sell and there is no way you can break even like that. Start the business and put yourself on a salary from the out set. Separate your finances from the finances of the business.

Checking Fraud
You have to lead from the front. If you don’t want your workers to steal from you as the owner of the business, don’t steal from yourself. Do you know that some people steal from their own company? It is simple. When you ask your procurement manager to inflate the cost of importing your products and at the end of the day your staffers decided to sell part of the product because its not moving and you are annoyed, why are you annoyed you have already stolen, so if others are stealing they are just following your example. Once you lead from the front then you would have succeeded in establishing a culture and the culture wil transcend the whole organisation

Culled From Sun Newspaper Sept 2008

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