Tanzanian entrepreneur Tryphone Male, director of Trimale, tells us about the challenges he faces as agri-food trader and why he choose to do business with the government instead of selling his products to private markets.
How did you start your trading business?
“In 2005 I started trading rice and maize. The business grew and supported the founding of other lines of business. Unfortunately, I suffered a big loss because the aggregators I paid to buy crops from farmers, disappeared with my money. Then I signed a contract with a few government schools to supply all their food, such as beans, rice, fruits and vegetables. That’s why I sell so many different food products. At the moment, I have a retail store for rice in Arusha and storage in Geita which supplies food to three government schools.”
Before you were active in the fishery business. How are things today with Lake Victoria’s fishing industry?
“It’s difficult nowadays to make a living as fisherman on Lake Victoria. For many years the fishing industry at Africa’s largest lake was booming. Thousands of fishermen flocked to the lake and the boom created countless jobs in the fishing industry. Due to the illegal use of restricted nets and dynamite used for catching fish, the lake now has a scarcity of fish (Nile Perch and Tilapia). So, these days each individual fisherman is catching much less than during the booming years, while they have to work much harder for their haul. The government tries to reverse the damage of overfishing and only allows licensed vessels and special fishing gears - nets with a limited size and minimum mesh size so immature fish cannot be caught. For a small-scale fisherman its hard these days to make a profitable business out of it. If you don’t meet all the requirements, the fines are really high. That’s the reason why I am not active in the fishery business anymore.”
Why do you sell most of your products to government schools?
“The government pays a better price for my products than the local markets. These higher margins make my business more profitable. It also offers me security, since I signed a contract with these schools. For at least one year I can supply all the food, from rice and salt to fruits and cooking oil. The only problem is the irregular payments of the government, which seriously affects my cash flow situation. Sometimes they pay me within a few days, but there are still unpaid bills from years ago.”
What are the main challenges for you as a trader?
“Most importantly the late payments from schools. The present government pays well but the previous government had trillions of shillings in unpaid arrears to suppliers and contractors, just like me. I still did not get paid for the products I supplied to schools years ago. The governments announced they first want to investigate if these former invoices of suppliers and contractors are genuine. So, I have to wait and hope that they still refund me the money for the products I delivered, which is about TZS 4 hundred million (€150,000). Another major challenge concerns the petrol stations that I own. Last year the Tanzanian Revenue Authority (TRA) ordered all fuel filling stations across the country to install electronic fiscal devices (EFDs), that automatically issue receipt to buyers. The costs were high because every pump has to be installed with that device. Moreover, my filling stations were temporary shut down by the TRA after I couldn’t install the EFDs in time, just like many others.”
How did you hear from SME Impact Fund and why did you apply for a loan?
“I do business with another client of SME Impact Fund, who told me about the fund and how they could help me to grow. In 2017 I applied for a working capital loan to buy and distribute processed food to the government schools. At the time I received this loan, the TRA directed all filling stations in the country to fix EFD machines to the gasoline pump station. The urgency to “purchase the new devices before they close my stations” made me decide to use the loan for my petrol station, instead of buying stock. With the profit I make now with my petrol station, I repay my loan and buy stock. Once I paid back my SIF loan, I want to apply for a new one to buy two trucks to transport my products and start more business lines.”
