Nigerian business mogul, Aliko Dangote is the richest man in Africa. With the net worth of $16.5 billion and there are alot to learn from him as a business minded person.
Shortly after graduating from college at 21, Dangote borrowed $3,000 from his uncle to import and sell agricultural commodities in Nigeria, his native country. His business venture quickly became a success, and as a result, he managed to repay the entire loan within three months of starting operation.
5 Things To Learn From Africa’s Richest Man
Invest in what you know
After Aliko Dangote graduated from Egypt’s Al-Azhar University, he took a $3,000 loan from his uncle and set out on his own, but he didn’t stray far from the family business. Dangote used the loan to import rice, sugar, and cement from overseas at wholesale prices and then sell locally at significant markups. This was a business Dangote understood, he invested in it, and he was able to make the venture an immediate success.
Find companies that create value
Dangote’s business flourished for 20 years, but he saw the opportunity to shift directions, fulfill a dire need. and grow even more. He made an operation that could meet the ‘basic needs’ of a vast and fast growing population.”
Having begun as an importer and trader of commodities, Dangote already had a strong distribution network with companies, so he had a distinct competitive advantage as his company transitioned into manufacturing flour, pasta, and sugar.
Harness the power of brands
Dangote said, “To succeed in business you need to build a brand and never destroy it.” Dangote branded his products with his name.
Therefore, your brands must be built on high-quality products at affordable prices.
Focus on strong capital allocation
Building and maintaining a brand requires substantial investment. And if there’s one thing that stands out about Dangote, it’s his ability to successfully plow money back into his businesses. He has created the economies of scale that allow his company to sell products at cheaper prices than his competitors do.
The successful reinvestment into Dangote companies is a consistent theme. It’s also happened by way of multiple expansions at Dangote Sugar, which has grown to become the second largest sugar refinery in the world.
However, along with reinvesting into current business, what makes companies such as the Dangote Group special is their ability to move in multiple directions. The Dangote Group has ventured beyond its initial focus of cement, sugar, and flour and into real estate, telecom, steel, and oil and gas.
Today, Dangote Group is a massive conglomerate generating $3 billion in revenue annually.
Dangote is a polarizing figure, but his story provides plenty of interesting business insights and investment advice.