Businessman wants to expand beyond Nigeria

ColdHubs is a Nigerian firm that operates solar-powered chilly rooms, offering a pay-as-you-store service for recent produce to smallholder farmers and market retailers. Since 2017, when How we made it in Africa first interviewed founder Nnaemeka Ikegwuonu, the corporate has proven substantial progress, greater than doubling the variety of chilly rooms out there. Jeanette Clark spoke to Ikegwuonu about his deliberate regional growth, diversifying operations and shifting away from cash-based transactions.

Providing an answer for meals spoilage

ColdHubs was based in 2015 in Owerri, in Imo State, Nigeria. The important goal was to present an possibility for farmers and retailers who misplaced revenue because of the spoilage of recent produce due to an absence of chilly storage amenities.

Each 3m² cooling unit can maintain three tonnes of meals, with clients renting 20kg capability crates to retailer their merchandise on the hubs which can be out there all day, on daily basis.

In 2017, two years after beginning operations, the corporate ran 25 chilly hubs in three states of Nigeria with a workforce of simply seven. Today, it has 54 hubs in 22 states, with a complete workers of 68. According to Ikegwuonu, it can have a further 18 hubs switched on earlier than the top of the yr, with workers seemingly growing to 85.

In 2021, the corporate reported it had been ready to retailer 50,700 tonnes of meals that would, in any other case, have gone to waste. For this yr, it hopes to attain 150,000 tonnes.

Regional growth on the playing cards

Over the final 5 years, ColdHubs has benefited from numerous grants to execute its growth plans, together with funds from USAID, Swiss RE Foundation and the Government of Japan. As a part of funding acquired from GIZ, the German company for worldwide co-operation, it’s now wanting to expand to neighbouring Benin.

“We just wrapped up a detailed scoping study of the country and identified the relevant food loss clusters, which are places we will target for the building of cold hubs,” says Ikegwuonu. “We are also talking to the UN Industrial Development Organisation (UNIDO) to support our planned expansion into Sierra Leone.”

These two international locations would solely be the beginning. For Ikegwuonu, there are numerous different international locations on the want record: Mali, Senegal, Côte d’Ivoire, Gambia and Cameroon.

Nnaemeka Ikegwuonu, founding father of ColdHubs

Diversification

In the long run, ColdHubs wants to place itself for industrial fairness and debt funding. To entice this funding, it’s diversifying operations. “As much as we have the stationary cold rooms, we recently acquired refrigerated trucks as well. We want to emerge as a Nigerian cold chain company.”

ColdHubs has additionally elevated its manufacturing of returnable plastic crates used for the packaging of recent produce.

Furthermore, to enhance the potential customer base, the corporate efficiently developed solar-powered phase-change cooling know-how suited to the fish and meat worth chains. Phase-change supplies are cooled when there may be ample sunshine to energy the unit after which, owing to their materials properties, hold a gentle cool temperature throughout dusk or overcast situations.

“It significantly drops the temperature from above zero degrees Celsius to about minus 15. This is significant in the industry and the sector. We’ve already received a lot of requests from fish retailers and meat abattoirs across Nigeria,” says Ikegwuonu.

These decrease temperatures hold merchandise recent for the lengthy journeys many casual merchants undertake to get to the related markets.

“We are in discussions with potential investors who are very interested in this technology and the pay-as-you-go storage model we have.”

Solar effectivity and safety considerations

ColdHubs’ present amenities can run for 3 days with out full sunshine. “We’ve never had an experience where we had no sunshine for such a long period. The energy is stored in batteries and also in phase-change materials. With improvement in solar panels over time, even overcast daylight helps to keep it running,” reveals Ikegwuonu.

The enterprise has struggled with injury to the hubs previously. “In the beginning, we didn’t do a lot of assessments in communities before deployment, and we had cases where batteries, solar panels and even the enclosing structures were vandalised. We have since changed our strategy and we now build them only where there is some level of security.”

ColdHubs at present has 54 storage amenities in Nigeria.

The upkeep of the items is digitally managed; each unit sends a digital sign to the central working workforce who can decide whether or not it’s functioning. “There are six sensors in each room. We can tell what is happening using a live screen on our mobile phones.”

Routine upkeep is completed each three months and a technical workforce collects information each day on the photo voltaic irradiation ranges, ambient temperature and even the variety of occasions the doorways are opened. “We are using this robust internet-of-things system to pre-empt maintenance,” explains Ikegwuonu.

Moving away from money

For its distinctive pay-as-you-go storage service, ColdHubs has predominantly used money transactions. A buyer would pay 200 Nigerian naira (about half a US greenback) to retailer recent produce in a 20kg returnable plastic crate, for someday. If they don’t choose it up the subsequent day, they need to pay the extra each day fee for the time it was saved.

As the corporate serves largely lower-income small-scale farmers and distributors, it has been tough to introduce any digital type of fee. ColdHubs is engaged on a singular fee possibility, which shall be launched subsequent yr, and hope to see adoption from its present buyer base. “We want to phase out all the cash-based payments, as there are a lot of challenges in managing cash. We have multiple cold rooms in different locations. Unfortunately, such a decentralised system can lead to pilfering,” says Ikegwuonu.

Requests for bigger chilly rooms

For Ikegwuonu, crucial improvement has been the curiosity proven by farmers for bigger, 100-tonne solar-powered walk-in chilly rooms that may retailer 5,000 crates.

“By October we will be opening two of these units specifically designed for the farmer aggregation centres. The three-tonne cold rooms we had were just too small for their purpose. These new rooms have automated packing lines and will revolutionise the food supply industry in Nigeria,” he provides.

“We are very excited about it and are planning to roll them out across Africa in future.”