Overview
In this second episode from Zambia, I speak with an entrepreneur who has found his niche and is fully focused on it.
Paul Nyambe grew up farming goats in rural Zambia. He and his family were unable to earn money from the animals which always struck Paul as frustrating.
Years later he built a career in food sales, specifically ice cream, which meant had relationships with large supermarkets and restaurants.
One noticeable thing missing from the menus and shelves was goat meat.
In 2012, Paul quit his job and started Zamgoat.
The vision is simple: to sell high-quality goat meat to the public.
In our conversation, we talk through various parts of the business such as the profit margin on a goat, the barriers to entry for getting a goat in supermarket aisles, and the reasons why Paul is so positive that goat products are the next big thing for consumers around the world.
We also chat about the potential for more value creation in goat products, such as making rugs from goat skins and various other products.
If, on the off chance, you happen to know someone who’d be interested in advising Paul in this regard, please let me know via the contact form.
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Social Media Links
Website: http://www.zamgoatgroup.com/
Facebook: https://www.facebook.com/zamgoat
Twitter: @zamgoat
LinkedIn: https://www.linkedin.com/company/zamgoat-products-ltd
Transcript
Sam: 00:07 Intro.
Sam: 02:35 Cool. So we’re here today with Paul from Zamgoat. Paul, welcome to the show.
Paul: 02:40 Thank you so much. Sam
Sam: 02:42 So to get started, can you tell us a little bit about you and a bit about Zamgoat?
Paul: 02:46 Okay, so like Sam you’ve put it, I’m Paul Nyambe and I’m the founder and CEO of Zamgoat. I was born in the Southern part of Zambian, I currently live in Lusaka and I started Zamgoat in 2012 and I’ve been actively running it since since then.
Sam: 03:02 Very cool. And we should note that you’ve got a bit, you’re recovering from a flu at the moment, so your voice is not…
Paul: 03:08 So my voice is a bit, a little bit Husky.
Sam: 03:11 And from the name. So I mean Zamgoat, you’re in the business of goats in Zambia.
Paul: 03:18 Exactly, exactly. Yeah. So we’re in the business of goat processing and distribution. Essentially what we do is we aggregate goats, we do not keep our own goats. So we buy goats largely from small holder farmers. We then process and distribute goats to get the emerging urban consumer base in Zambia, initially starting out with the Lusaka urban market.
Paul: 03:41 Very cool.
Paul: 03:42 Yeah.
Sam: 03:42 Great stuff. Okay. So you so I’m sure there are lots of things that we can talk about both on the sort of supply and the demand side. I’m interested though, how did you spot this opportunity? How did the business sort of, what’s the founding story of the business?
Paul: 03:56 I guess so, it started from a combination of two realities of my life, one of which is my rural upbringing. Growing up in a village set up as a child and keeping goats, my family keeping goats, with no economic impact whatsoever on our lives, you know, but just for village prestige, like any other villager would do at the time. Reason being or why there was no economic baring, more or less through our good keeping activities was because of lack of access to a readily available market. So later on, growing up in the city and working the city as a country sales person for, you know, a food company in Lusaka. You know, my experience with that, working experience, exposed me to a gap in the market. I used to do mostly with supermarkets, restaurants and hotels in supplying out food orders at the time for the company that I used to work with. But then I observed there was no goat meat sold in those supermarkets. And goat was also a rare feature in most restaurants. I mean most restaurants and hotels in Lusaka, whereas on the other hand, again, I’m an ardent consumer of goat. I love goat meat. So that, you know, opened up my eyes to the opportunity and that’s how Zamgoat started in July, 2012.
Sam: 05:18 Very cool. What was the other food you were selling?
Paul: 05:21 So my last job before I started Zamgoat, we used to, I used to work for a company that used to deal in ice cream.
Sam: 05:28 Okay.
Paul: 05:28 So yeah, I’m a former ice cream sales person. I used to sell ice cream.
Sam: 05:35 At times, did you get paid to try out new ice cream? I mentioned that when there was, when you were selling ice cream, you had, you were given free samples and things?
Paul: 05:45 Yeah, sure. So yeah, we would give out free samples to try to our customers during our field sales.
Sam: 05:53 Okay. So basically you went from ice cream to goat?
Paul: 05:56 I went from ice cream to goat cause that was my last job.
Sam: 05:58 Yeah. Very cool. Okay. Right. So what should, so let’s start on the let’s start on the demand side.
Paul: 06:04 Yup.
Sam: 06:04 Okay. So the, you were saying that the supermarkets, restaurants, hotels weren’t selling goats. Is that because the consumer, the end consumer wasn’t demanding it or was, was it because they just didn’t have a reliable way to get on, to get it on the menu?
Paul: 06:22 At that time there was a gap in the supply side. There was no company that was processing and you know, making goat available in those…
Sam: 06:30 So people were still wanting it.
Paul: 06:33 People would still want goat but at that time, I think the only source where people could, consumers could get goat meat from was from the informal market setups and these mostly are open markets, you know, setups that have a lot of litter and hygiene issues with them.
Sam: 06:51 Yeah.
Paul: 06:51 So that to a large extent tended to, you know, limit the uptake of goat among consumers.
Sam: 06:57 Got it. Is goat quite, is it something which is eaten across Zambia or is it just particular regions that sort of eat it?
Paul: 07:06 Goat meat is eaten right across Zambia and now, more consumers ought to actually love to eat goat more than any other meat products. And this, I think can be attributed to the health and nutritional benefits and values that you know, are associated with goat meat as compared to other red meat.
Sam: 07:26 Such as what?
Paul: 07:29 One of which, I think the key health benefit for goat is it’s lean, you know, it’s leanness, It’s a lean meat and that means it poses less challenges that associated with that cholesterol, you know, cholesterol levels in in mid, in mid consumption.
Sam: 07:50 Okay. What are some traditional ways that goat is eaten?
Paul: 07:53 Traditionally the goat is mostly eaten in a stew form, but that stew, normally people don’t add, you don’t add any other ingredients apart from salt. So just boil the goat and then add your salt and then they take it as a goat soup, which sometimes they also eat with the local staple, which sima.
Sam: 08:13 Sima?
Paul: 08:13 Yeah. The other common way that goat has eaten traditionally in Zambia is through Bryce.
Sam: 08:19 Like a barbecue?
Paul: 08:21 A barbecue, yeah. Most people eat it in barbecue foam, but that is mostly, again, common in social joints, drinking places, stuff like that. Yeah.
Sam: 08:33 Okay. And so when, we’ll sort of get to a bit about how you’ve done it, but you’ve basically been able to say, go to supermarkets, hotels, restaurants and say I’ve now got a high quality supply of goat. What’s been the, what’s been your sales pitch when you’ve been going to, have you found it an easy pitch or have you found that they’ve said, Oh, well I’m not sure if people are actually going to eat it?
Paul: 08:58 Sure. Our pitch in trying to upscale the goat, you know, the distribution of goat meat in Zambia is our emphasis on one wanting to transform the entire quotive value chain through value addition and improved of distribution of goat meat, which in turn would then also create a sustainable market opportunity for smallholder farmers. So our pitch out there is unlocking the availability of goat in convenient places where consumers would easily find goat meat, at the same time also creating a sustainable market for small holder farmers. So most of our customers engage with us on those two fronts. Wanting to make goat available conveniently to the growing consumer base of goat meat, but also wanting to contribute to the greater good out here, by creating a sustainable market opportunity for the small holder farmers who are the main producers of goats in Zambia.
Sam: 10:10 Got it. Okay. So when you’re going to, I don’t know, the Radisson hotel for example or you know, like one of your big suppliers or one of the, one of your big customers you’re partly saying by putting goat on the menu, you can tell your customers that they are supporting small holder farmers.
Paul: 10:28 Exactly.
Sam: 10:28 Yeah.
Paul: 10:29 Yeah, sure.
Sam: 10:29 Does that resonate?
Paul: 10:30 Yeah, sure. That’s what we do and most of our customers actually buy into that. Okay. So they buy into making goat available for their consumers but also stocking it as a way of supporting small holder farmers out here.
Sam: 10:46 Yeah. When you go to your sales pitch, you bring along some goat for people to try?
Paul: 10:52 We do so, especially like when we introduce a new product range, cause we have quite a number of goat products that we supply. So besides the fresh, ordinary goat meat as in it’s fresh or frozen state, we also do smoked goat meat. We do goat buton. We do goat burgers as well.
Sam: 11:17 Oh, burgers.
Paul: 11:17 Yeah, sure. So like in terms of, when I introduce a new, we just introduced a new product line we normally go with the samples, you know, for our customers to try out.
Sam: 11:29 Very good. Okay. So company’s been going for about, like seven years, seven years now?
Paul: 11:35 Yeah, about seven years.
Sam: 11:37 What sort of scale are you at now?
Paul: 11:39 We are quite at a good scale right now, starting out with just one goat in 2012, with under $200 in startup capital. We have at least to date, you know, done over 5,000 goats. Okay. And generating revenues, you know, slightly above $400,000 now. So for us, I think that’s a good traction, but we would have loved to do more than that. Would have loved to do more than that.
Sam: 12:08 Yeah.
Paul: 12:08 But we understand, you know, the Strata of our industry as a whole, they goat industry. Historically it has been underdeveloped. But, you know, we are still satisfied, I think with the strides that we’ve made so far, though we feel, I think we should have gone more, more than that.
Sam: 12:28 Okay. So let’s sort of talk about the, the process that you have. So you’ve, sort of stage one is going and collecting live goats?
Paul: 12:38 Live goes from small holder farmers. Yes.
Sam: 12:40 Yeah. And then maybe just sort of, can you sort of walk me through the whole process from receiving a goat, all the way through to it being sold as a goat burger.
Paul: 12:51 Okay. So it all starts from first engaging with small holder farmers whom we mostly organize in supplier groups and cooperatives. And then from there on we agree on the terms of business with them, we offer them a good buying price. Good in the sense that our price is actually better than the prices that most of the informal traders do, you know, of our farmers out here, and then from there on after we buy those goats from the smaller farmers. We take them to our processing facility in Lusaka, currently operating out of market. From there we do process goat, which we sell in two, or rather through two main ways, through the butchery set up where we, sell, you know, goat meat in its fresh frozen state as well as other value added products, that includes smoked goat, buton and goat burgers. And then we also have another sales channel which is a take away. This is a recently added sales channel where we are doing ready to eat goat products. Okay.
Sam: 14:05 So within your processing plant you will be cooking?
Paul: 14:10 Yeah, so currently we are trying to optimize the space that we have at our store, which also serves as, you know, a processing facility at the back end of it.
Sam: 14:20 Yeah.
Paul: 14:21 So we have, on the other side of the store, adjacent to the butchery section, we’ve recently opened up a take away offering, and the brand, we are calling Zamgoat express, so that offers good goat amd chips. We do smoked goat and chips, we do goat burgers. We do goat sausage and chips. Yeah. And those, we do an upscaled vision of goat soup, which is different from the traditional goat soup that, you know, has been common on the Zambian market.
Sam: 14:59 Very cool, Okay what, in terms of the, sort of the economics of it, how much do you buy it? How much roughly do you buy goat for, roughly what ptice?
Paul: 15:10 So roughly we buy our goats at about $30 from a small order farmer, $30 per goat.
Sam: 15:17 Okay.
Paul: 15:17 Yeah.
Sam: 15:17 And how much, what’s the process to value of that goat?
Paul: 15:22 On average, the minimum processing value of the goat that we sell is around $45.
Sam: 15:30 $45, okay. So you;re making about $15.
Sam: 15:32 Okay. And so what’s been the cost? What’s been the total cost to sort of set up the processing plant? I’m just trying to work out how…
Paul: 15:42 So to date I would say we haven’t really had a formidable processing plant, so we’ve kind of you know, been bootstrapping our processes whereby we are doing everything that we do using very limited that means so far we’ve invested over $40,000 into our current, into our current processing facility, but we are actually current working on setting up an ideal processing facility,which is estimated to cost around $400,000. So we’re currently actually active in the market trying to raise the capital to set up an ideal processing facility so that we could then supply more good products out there. So satisfy our market as well as also increase our impact in working with smolder farmers.
Sam: 16:41 Yeah. Okay. So $400,000. And you’re making about $15 per goats, so you’re gonna have to do like 250,000 goats, is that right? No, no, 25,000 goats.
Paul: 16:52 About 1200.
Sam: 16:53 25,000 goats?
Paul: 16:55 Yeah.
Sam: 16:56 Is there demand for that? 25, like at the moment you, you’re sort of production’s about, you’ve done about 5,000 goats. I mean that’s increasing the capacity of your operation by five times.?
Paul: 17:12 Yeah. So actually our target increase in capacity is about 10 times more than what we’re currently doing.
Sam: 17:20 Okay.
Paul: 17:21 Sure. So we’ve done about yeah, you’re right. So it’s close to about 10 times more in terms of production output.
Sam: 17:32 And I mean, I don’t, I know nothing about the goat industry, but I’m just thinking if you’re making $15 per goat and there’s, it seems like there’s a lot of, you’d like, you’re adding a lot of value. You’d be processing it, you’re packaging it, you’re distributing. I was wondering if like, do you need to get a certain scale before it’s become, before you make money off this, like, or is it already profitable? Like?
Paul: 18:00 It is already profitable, except that the current state of profitability is limited by scale by our current scale. So we can only do so much for now, given our limited capacities. We Believe that once we grow capacities, then even our profitability should also be able to.
Sam: 18:24 So that means that out of that $15 per goat that you’re making your, costs would you reduce?
Paul: 18:30 Exactly, the cost will reduce because of optimize…
Sam: 18:32 Yeah.
Paul: 18:34 You know, our processes.
Sam: 18:35 Okay,
Paul: 18:35 Sure.
Sam: 18:37 Do you think that you’d ever pay less for a goat? Ket’s say at the moment, if you’re going to a small holder farmer and you’re buying 10 goats off them for $30 each, would you ever get to a place where you’ll say, right, I’ll buy 50 goats off you for $25?
Paul: 18:54 Exactly. So with increased the capacity operating capacity on our side, there is the possibility of us incresing our costs
Sam: 19:01 But do the, do these kind of small holder farmers sell 50 goats for $25?
Paul: 19:10 They would sell.
Sam: 19:11 They would.
Paul: 19:12 Yeah, they would sell, they would sell. Again, it all gets back or it all borders on our capacity at any given time. So with capacity at any give timeit is a fault to negotiate with our suppliers to look, we are buying so many at a go, so we’ll then negotiate for a bulk discount.
Sam: 19:34 Yeah.
Paul: 19:34 Okay. And then also that would make sense for the farmer because instead of just selling 10 goats, you know, they’ll sell at least more and make more money at a go than to make the same amount of, say in my photo.
Sam: 19:48 Exactly. Like, yeah. And they get, Just sent a lot of cash, which they can then use to invest in…
Paul: 19:53 To invest in that, in other activities that also, in enhancing their livelihood. Yeah.
Sam: 19:59 How do you transport the goats? You said, I’m forgetting…
Paul: 20:02 Yeah, so for now we outsource transport. We hire delivery trucks, we hire open trucks that move our life goods from the farmers to…
Sam: 20:14 Do you have to take a Zamgoat representative to like tick off this number of goats have gone on.
Paul: 20:19 Yeah. So we normally have people on the ground.
Sam: 20:21 Okay,
Paul: 20:21 Sure.
Sam: 20:22 How many people are employed?
Paul: 20:24 Currently, our establishment is still small. We have a total of four staff when I was that, I’m sure.
Sam: 20:31 So there’s you and three other people.
Paul: 20:33 Yeah. There’s me and three other people.
Sam: 20:35 Each time that you go and buy goats, one of the four of you has gone.
Paul: 20:40 Yeah, it has to be. Yeah.
Sam: 20:42 Yeah.
Paul: 20:42 But then we also have times when farmers bring themselves, so they come through to Lusaka. So we’ve made ourselves so popular among the small holder farmers, such that every farmer out there who’s living in the outskirts, whoever wants to sell goat, they know that there is Zamgoat. So they give us a call and then we make arrangements for the delivery. And sometimes, you know, there are those that you’ll be dealing with for some time, we know that they’ll bring us the right quality of goats. So we give them a go ahead. Okay. How many are you ready to supply this time around? They give us their number and then we give them a go ahead. Okay.
Sam: 21:26 Yep.
Paul: 21:27 Move them over to Lusaka, show.
Sam: 21:29 Nice. What’s your quality assurance process when you see a goat? Do you, do you like how do you…
Paul: 21:38 Yeah, so we look, we look at quite a number of things. One of which include the general wellness wellbeing, the physical stature of the goat. Okay. It has to appear to be in its, you know, perfect state. Okay. To go out to guarantee us quality meat, then two, it’s the age. We look at the age.
Sam: 21:58 How do you tell the age?
Paul: 21:59 There are a number of ways to tell the age. It’s the general appearance of the goat. You can tell this goat, I think. You know.
Sam: 22:05 Okay.
Paul: 22:05 Yeah, ths goat is too old. Then the other technique we use is looking at the teeth for measure, yeah.
Sam: 22:15 The teeth, is that a good gauge for the size, the age of the Goat?
Paul: 22:21 Yeah. To some extent it, it is to some extent, yes.
Sam: 22:26 Yeah.
Paul: 22:26 Sure. I think the best technique is just the general physical state of the goat in its appearance has to appeal to you as a buyer.
Sam: 22:37 It’s gotta be…
Paul: 22:38 It has to be safe. Okay. And not, you know, you’re looking at a goat, you’re able to see the ribs exposing, you know, protruding from out. So that it will give you an indicator. No this might not be, I think, in order to give us good quality meat. So it has to be well rounded.
Sam: 22:59 Yeah. What’s the best age for a goat?
Paul: 23:03 So we’re prefer goats that are not more than three years in age for meat production. Yeah.
Sam: 23:09 Yeah.
Paul: 23:10 I’d say between one and a half years and three years there about.
Sam: 23:15 Okay.
Paul: 23:15 Sure.
Sam: 23:16 And then goats enter your processing plant. And at the other end, we’ve got goat meat like in between, what happens to, so obviously like the goat is killed. What happens to like the other parts of the goat that aren’t used for meat?
Paul: 23:34 Yeah. So you’ll be shocked to learn that to date nothing much happens to, except for the offers. We sell the offers in our butcher section, then we use some also for the takeaway section, but then for the other parts of the goat like the skin to date, nothing that much has been done, you know, in terms of adding value to the goat skins.
Sam: 24:00 Yeah.
Paul: 24:01 So mostly goatskins in Zambia are just thrown about. But, you know, being pioneers in this industry as Zamgoat, we’ve taken it upon ourselves or seen an opportunity in that area as well to start adding value to goat skills.
Sam: 24:16 What could be done?
Paul: 24:20 So one of the things we’re looking at is adding value to, you know, to, to goatskins to save the local market coming up with finished products like belts you know, device poaches you know wristbands and stuff like that.
Sam: 24:36 Can you make rugs?
Paul: 24:37 Yeah. You can also make rugs, you can make bags.
Sam: 24:40 Okay.
Paul: 24:41 You can make shoes like the final leathershoes, most of them are actually made out of goat skins. The other opportunities doing maybe just basic processing and then exporting the semi processed goat skins.
Sam: 24:55 Okay.
Paul: 24:55 To the other parts of the world.
Sam: 24:59 So if there are any goat skin artisans listening to the podcast, they should get in touch with you?
Paul: 25:05 You’re right.
Sam: 25:05 They would be able to come sort of help with the, making nice things.
Paul: 25:10 Excellent.
Sam: 25:10 Okay, cool. How long does it take between goat enters and like processed meat at the end?
Paul: 25:20 Okay. On average takes about 15 minutes. Let me say 15 minutes.
Sam: 25:28 Yeah. Okay.
Sam: 25:29 You do one at a time?
Paul: 25:31 Yeah. So we do, slaughtering, given our current limited capacities, we do slaughter them one at a time.
Sam: 25:37 Is it by hand?
Paul: 25:38 By hand. Yeah. Currently slaughtering is done by hand and then flailing also by hand.
Sam: 25:43 Flailing?
Paul: 25:43 Yeah. Removing of the skin is manually done for now because of our limited capacities.
Sam: 25:49 But this $400,000 investment.
Paul: 25:51 So this $400,000 investment, we are looking at investing in some, at least close to state of the art, you know, kind of facility that would enable us to, you know, to process our goat in a much commercial like manner unlike, you know, how we are currently doing it.
Sam: 26:13 And would that be like a machine?
Paul: 26:15 Yeah. So we are looking at, you know the slaughtering line where you have some conveyor belts that, you know, that electronically move the goat from the slaughtering stage, the flaring stage. Yeah. Up to the, you know.
Sam: 26:34 Where do you, where do you buy that machine from?
Paul: 26:36 So for now it has to be imported from outside the country.
Sam: 26:43 Made in China, India?
Paul: 26:44 Made in China. China will always be the cheapest, you know, the cheapest source, I’ve had some discussion with a number of our suppliers of slaughter house equipment in China. Yeah, sure.
Sam: 27:01 Purely out of interest, do they eat goat in China?
Paul: 27:05 They do, yeah.
Sam: 27:07 Okay. So they probably got it. They’ve got these machines that would be that would be perfect, got it.
Paul: 27:14 And they do slaughter goats there as well.
Sam: 27:16 Yeah. Okay. Because you’re going to get one of these machines and then you’re going to be able to, once you’ve got that, your capacity and then you can just go out and buy more goats. What’s like, if you’re saying that you buy at $30 and you sell at $45, roughly how many days does it take for you to keep the money?
Paul: 27:37 Ideally, it doesn’t take, sort of like through our, our butchery section. So we have a two revenue model, which is retail and wholesale. So wholesale, I mean retail is cash sales.
Sam: 27:52 The cash.
Paul: 27:52 So you slaughter the goat then within a day or two you have, you know, you recoup your money.
Sam: 27:59 Yeah.
Paul: 27:59 And then we also have another revenue model, which is wholesale supplies to these other intermediaries that include supermarkets, restaurants, and hotels. So that in most cases comes with credit, you know hotels. And at most for now, we, we, we accept at least two weeks.
Sam: 28:18 Okay.
Paul: 28:18 Yeah.
Sam: 28:19 So 14 days is your max?
Paul: 28:22 Sure.
Sam: 28:22 So it’s not 30 days?
Paul: 28:24 For now, it’s not 30 days, given our current, you know capacities we can’t do 30 days because then that would wipe out the much needed cash that we need to manage the operation.
Sam: 28:35 Okay. So let’s say you’ve got an, and how does it work? Does it, have you kind of got like a constant flow of buying goats, processing them, selling them? Or is it kind of like up and down?
Paul: 28:51 So it’s up and down. And it mostly depends on two factors, one of which is the demand on our markets marketing side. Okay. And the demand of products from our customers who we’ve signed up with, then two, it is our capacity in terms of you know, working capital, to procure at any given time.
Sam: 29:15 Yeah.
Paul: 29:15 Yeah. So it depends, again, it fluctuates Nothing.
Sam: 29:19 Yeah. But there’s, okay, so there’s demand. So what might cause a fluctuation in demand?
Paul: 29:26 A fluctuation in demand is caused by a number of factors. One of which is the marketing of goat in the manner that we’ve been trained to do it is still relatively a new thing on the market. So a lot of you know, customers and partners through which we sell our products are still getting, you know, acclimatized to our concept and distribution.
Sam: 29:59 Are they still sort of saying, okay, we’ll buy a hundred goat burgers and see how it goes as opposed to we’ll have 200, so they’re still in that sort of testing.
Paul: 30:09 So there’s still a bit of market development activities, you know, going on.
Sam: 30:13 Yeah.
Paul: 30:13 On our end here.
Sam: 30:14 How do you, do you go around with leaflets, how do you sort of…
Paul: 30:18 Yeah, so we, yeah, we do leaflets and then we also do online marketing through you knowplatforms like social media, useing Facebook, Twitter our website as well as just, you know,physical visits to targeted clients.
Sam: 30:42 Okay. So let’s say, are you in shoprite?
Paul: 30:46 Not yet. So for some reason we are yet to start dealing with most of these big retail chains. And the major limiting factor for now is our luck luck over the right, I do, operating scope in terms of processing as well as distribution capacity in terms of…
Sam: 31:13 As in, they’ll only deal with you if you can do a thousand goats.
Paul: 31:16 Yeah. So you need to have a certain level of capacity, you know, we don’t want to engage with you and then tomorrow you’re unable to supply. They need to, again most of these large retail chains are very particular in terms of hygiene and sanitary requirements. So your products, your processes must meet certain, you knowcriteria?
Sam: 31:43 Yeah.
Paul: 31:44 Like how you go about slaughtering, processing and also delivering your goods to market, you need to meet a criteria, which to date I think,e’re still working on and that’s the more reason why we’re also trying to raise money, so that we can scale up our operation and move, you know, our business from this state of,you know, proof of concept like. I think we’ve overstayed at this stage and now we need to grow our capacity and just,ou know, flood the market with…
Sam: 32:19 Flood the market with goat meat. Yeah. I mean you’re right. I mean it seems like you’ve been going for seven years now. You’ve kind of worked out visa the basic functions, you’re going to go off, buy goats, process them, sell them. Okay. Well you go…
Paul: 32:37 So now I think the only missing link is just, you know, aligning our capacities with the, the process that we’ll develop so far. So I do get to fully take advantage of, you know, the market opportunities.
Sam: 32:51 Do you think that there’ll be any resistance or any hesitation from let’s say Shoprite, so one of the biggest supermarkets here, will they perhaps say, okay, well, we’re going to buy this goat from you, but we don’t think people will buy it. Like, do you think you’ll have to do some?
Paul: 33:10 No.
Sam: 33:11 No?
Paul: 33:11 There’s no that hesitation, right now we have actually we have an active conversation with another large retail chain, Choppies. Okay. So they are ready to engage with us.
Sam: 33:24 Okay.
Paul: 33:24 By the end, they’re just waiting on us to be ready in terms of capacity setting up a formidable slaughtering facility, processing facility and also having the right distribution you know.
Sam: 33:38 Set up in cold, you’d have to have some cold chain.
Paul: 33:41 You need a cold truck cause you can’t deliver meat, you know, at the back of a cab. So you need, you need the right distribution tools, you need a cold truck, you need cold storage, sufficient cold storage so that you keep your meat, you know, in the perfect state at all times.
Sam: 33:59 How similar is, how similar is that process to beef and pork?
Paul: 34:05 It is very much similar.
Sam: 34:07 Okay.
Paul: 34:07 What process are similar.
Sam: 34:09 What’s stopping an existing beef producer or pork producer just saying, okay, we’re going to go out and buy some goats and put on and just,
Paul: 34:20 Yeah. I think until recently what was stopping them is really lack of the edge to try out new things or getting used to what they’ve been used to over time. And then two, I think most of these other general meat processors, you know, because of their size, scope. Again, at least most of them reached, a level where they, you know, they’ve gotten used to their routine, the products and the processes and, cause the goat, the goat industry really, you know, is one area that has been overlooked. So there’s never been a, you know,
Sam: 35:08 Did he run, considered it? They haven’t really been thinking about that. Right. If I’m just saying like, are you worried at all that one day, one of these pork producers or cow producers, or beef producers just says, just thinks, Hm, maybe we should try goat and they’ll suddenly be able to do at a really big scale. And does that worry you at all or are there are other reasons why…
Paul: 35:33 It doesn’t, it doesn’t worry me at all. Ourselves, we have an upper edge in the goat industry given our dedication to the, to the industry. So we’ve given ourselves our full focus to the goat value chain, that gives us an edge in terms of supply engagement. Then two also in terms of you know, the room to innovate within the industry. Okay. So we are not preoccupied with you know, many, you know product lines. So we are preoccupied with perfecting, our core product is the goat offering itself. So that gives us an edge as it enables us to, to be more innovative in our product offering. You know, than the general meat processors except to say perhaps the only worry like right now is or as regard to, you know, economic meat processor wanting to add goat, you know, to their offering. The only aspect in which that worries me is yeah, mainly, given their scale, they may get to market much more faster than us. So the only worry is maybe our lack of timely access to scale our lack of timely access to resources to scale up the business. I think that’s the magic. Once we have the right operating scope, I do not see anyone outdoing. Then two, the other thing, again that gives us an edge is our brand. Okay. Zamgoat is a…
Sam: 37:14 I mean there’s no escaping what you do is there?
Paul: 37:16 Exactly, so Zamgoat, I think is already growing into a very popular brand out there it’s growing into a household brand. Everyone who want to eat goat, they would think of Zamgoat.
Sam: 37:29 Yeah.
Paul: 37:29 Okay. So that’s another yeah.
Sam: 37:33 This might sound like a strange question, but is there any issue with you using Zam in your name? So like, isn’t it that there’s a telco company called Zam? Yeah, I did, It is the, does the government have any sort of rights to organizations that have Zam in the name? Do you know what I mean?
Paul: 37:57 No.
Sam: 37:58 It’s not like, cause I don’t, when I, you know, when I see Zamgoat, I might think, Oh that’s like the national Institute for goats. Awesome. So it’s like, it’s a great, it’s a great industry you’ve got, I was just wondering if there are any any issues you have with naming
Paul: 38:11 Yeah, no issues at all. We don’t have any issues. Even that’s, there are number of businesses out there that have got the Zam prefix to their names. Yeah. So for us we chose Zam prefix to own it, to make it Zamgoat, because we wanted to be really the leader of the goat industry in Zambia. Okay. And not only in Zambia, we wanted to be the company here in Zambia to be identified within the region, around the world, you know, as the company that is the pioneer of you know, activity in the goat industry.
Sam: 38:53 Yeah.
Paul: 38:54 Yeah.
Sam: 38:54 I guess if you wanted to go across the border, you’re going to have to know Zamgoat.
Paul: 38:58 Yeah. So if we want to go across the boarder, yeah. So again, depends on, on the, on the particular markets. There are markets that will be comfortable to go trade as Zamgoat, but for some markets we’re also looking at you know, coming up with other brands that are targeting particular international markets to make us more relevant and appealing to those local markets. Yeah, sure.
Sam: 39:20 What are some names you’ve thought of?
Paul: 39:22 So currently there is another food service outfit that we’re working on, which we know we are calling Pizzagoat Africa and this is pizzagoat.
Sam: 39:32 Pizza?
Paul: 39:32 Goat, pizzagot.
Sam: 39:34 P pizza. Have do you spell.
Paul: 39:37 Pizza as in pizza? P I Z Z A.
Sam: 39:44 Got it.
Sam: 39:44 As one word.
Sam: 39:45 Okay.
Paul: 39:46 So this is a brand that we want to use for our international market penetration on the food service side. Yeah. So we are calling it pizza goat Africa. Okay. So what, is what we want to use in growing, in penetrating or in having a physical presence in the, you know, African.
Sam: 40:07 Why did you go with Pizza goat?
Paul: 40:08 So pizzagoat, again it gets back to to our desire to value add and disrupt the distribution of goat meat or good products. So pizzagoat is a brand that is focused on providing exclusive goat pizza and pastries. Okay.
Sam: 40:28 Goat pastries?
Paul: 40:29 Yeah. Pastries. We’ll have goat pies, goat samosas, goat spring rolls.
Sam: 40:35 Yeah.
Paul: 40:35 Yeah. So, but the key product, you know, within that offering is goat pizza itself. Yeah. So we are currently doing a test run on the same, we’re yet to, you know, fully launch it out there. But so far we’re getting a lot of positive responses from our customers who get a lot of, you know, positive inquiries. People looking forward to, you know, to have goat Pizza.
Sam: 41:07 How many goats are in Zambia?
Paul: 41:09 Currently, the population of goats I think is slightly under 5 million.
Sam: 41:13 How do you know that?
Paul: 41:16 Livestock censuses that are normally conducted by the ministry of livestock and fisheries and their last update I think indicated, you know, somewhere around 4.8, 4.9 million goats.
Sam: 41:29 How many people are there in Zambia?
Paul: 41:32 Currently we’re around 17 to 18 million. The last census I think was around 16 million.
Sam: 41:38 Okay. So it’s pretty thin. Basically one goat for every three humans. Just purely out of curiosity, I’m interested if there are, what the goats to human ratio is what, like goats per capita is in other countries. Do you know, do you have any, are there any other countries where there’s a higher goat per capita or is Zambia a particularly goat heavy country?
Paul: 42:05 My recent discoveries, I think I’ve indicated that countries like Ethiopia, Somalia, and you know, Somalis in African countries Tanzania, Kenya do have quite a higher, you know, number of goats as well.
Sam: 42:19 Is that because the…
Paul: 42:24 Because of the religious, you know, factor.
Sam: 42:26 Yeah, I think it’s with like nomadic tribes, looking after goats and so there’s more of a culture of…
Paul: 42:31 Yeah, yeah. That’s another, another attribute. But, the other attribute is on the consumption patterns. You know, most of the mentioned countries, Somalia, Kenya, are Muslim countries. So they tend to prefer, you know, eating more goat than the other regions.
Sam: 42:52 Yeah. Is Zambia more or less purely Christian? Or is there a Muslim population here?
Paul: 43:00 There is a Muslim population. Yeah. But obviously Zambia is predominantly, you know, Christian in terms of population. But we do have quite a big number of Muslims as well here.
Sam: 43:15 Is Zamgoat halal?
Paul: 43:17 We are positioning ourselves to halal, but again, currently given our limited operating capacities, we have not yet reached that level, where we would be officially, you know, certified halal, but we are working on,
Sam: 43:30 Okay.
Paul: 43:30 On certifying, having Zamgoat certified as halal.
Sam: 43:34 At the moment a Muslim customer wouldn’t be able to buy…
Paul: 43:38 At the moment, yeah. That’s another market that we are currently missing out. So part of our plan actually in setting up the planned sloughter house facility is to be able to enable us, you know, qualify to meet that halal standard certification. Sure.
Sam: 43:57 Okay. Do you ever think, would you ever deal with like goat milk, or is that like different?
Paul: 44:03 So again, it gets back to the strata of the industry as a whole, totally under developed, no much activity in any specific area of it, be it milk, skin. So even with new products, nothing much has been done with, you know, goat milk in the country. But again, as a business, that’s something that becomes opportunity for us. So as we keep growing, we are actually seeing ourselves grow into a fully verticallly integrated business across the goat value chain, doing something, you know with everything about goats, including, you know milk products. So we are looking at getting into the nutritional market, you know segment with time, riding on, goat milk as a highly nutritional product as you know, which, you know, some people out there say goat milk is as good as a human milk. So with that…
Sam: 45:07 Do some people give goat milk to babies or is that…
Paul: 45:09 Yeah. I think some do but it’s not yet a popular trend but there’s a lot of positive vibes out there. This is another industry for the future within the, you know, goat value chain. So we are looking at with time we should be able to venture out in coming up with goat based nutrition, you know, products.
Sam: 45:36 Yeah. Like internationally, are there other countries where there is a or other companies that have said we’re going to vertically integrate in just goats?
Paul: 45:52 Yeah, there’s been a few countries where at least it’s recently beginning to be some activity.
Sam: 45:59 There are sort of Zamgoat equivalents. Whereabouts in the world is it?
Paul: 46:04 In Somalia, there are countries that just, yeah, I mean there are companies that just focus on goat processing and distribution.
Sam: 46:12 Are they sort of, are they a similar stage as Zamgoat?
Paul: 46:16 There could be some, I think I must have heard of, I’ve forgotten the name but is one company that is, that is doing pretty well in Somalia. So they’re quite an advanced, at an advanced stage in terms of their development as compared to Zamgoat.
Sam: 46:31 I’m just curious cause it’s always useful, I find, when there’s a company, you know, a country another part of the world where they’re never gonna come and enter the Zambian market, but you can still learn some good lessons from them. I was just wondering if there were, I don’t know. Vietnam for example, you know, pick a country. If there were any companies where you can say, okay, well in five years time we want to be like, yeah, “Indonesia goats.”
Paul: 46:58 I think there’s one common phenomenon across the world. The goat industry. I don’t know for some reason, somehow, it is an industry that has been overlooked. Okay. And for me, I think this is what, becomes the biggest opportunity. It’s a pretty, you know, under developed industry and that to me as an entrepreneur, you know, rings a lot more opportunity than most of these industries that are fully saturated. That the traditional, you know, meat industries, beef, pork and chicken. Then two, goat meat and the other assorted products are becoming the talk of the day, okay. Around the world. Goat meat is seen to be more healthier than these other meat products, goat milk, you know, is also seen to be a very healthy, you know, product, you know, with some data out there equating it to human milk, you know, to be as good as, you know, breast milk, you know, goat skins. Okay, that’s fine leather, it’s one of the most treasured you know, leather out there, but somehow again, to some extent, there’s still some slowness, you know, inactivity not to fully capitalize on these products.
Sam: 48:30 Why do, why do you think that is?
Paul: 48:33 The lack of innovation? Yeah, so this is, this is the time now innovative entrepreneurs, you know, prying their trade in the innovative age, like now to come up with innovations that add value to these products that have got a yearning market out there.
Sam: 48:51 Are there any countries where the goats are not indigenous or the goat, or there’s not many goats? One thing here is like in let’s say one of the biggest meat producers in the world is the U S and they’ve got loads of pigs and loads of cows, so they probably developed all of their machines and factories just around that because there’ve been lots of meats, beef cows and pigs around and so they’ve really sort of like grown the beef and pork industry. I’m just wondering had, if by historical accident, there were goats in America and they, 50 years ago, you know, 80 years ago, started factory producing goats. Whether that would have, is it that the fact that goats aren’t in places where there’s currently been big areas of meat production? Is that why it’s not seen as a popular product
Paul: 49:48 To some extent, yes. In fact you’ve just reminded me, one of the countries in the world that seems to have made headways in processing of goat products is Australia. Okay, there are companies in Australia that have made, you know, serious strides in adding value to goat meat and distributing it around the world. I was surprised during my stint in the US, I found, you know, Australian goat in some supermarkets in the US.
Sam: 50:18 I can imagine.
Paul: 50:19 Yeah.
Sam: 50:19 Any country you go to, you go straight to the goat, to the meat section and you check out where all the goats come from, yeah.
Paul: 50:26 Yeah. So they’ve made strides, and then yeah, their country, I think goats. Goats are there in most parts, but I don’t know. I think it’s just lack of there’s some stereotype perhaps that has been associated, you know, with goats.
Sam: 50:46 I guess as well if, yeah, if you’re saying that most people consume, choose what food to consume by, let’s say going to the supermarkets and if the supermarkets have a barrier where they say you’ve got to hit a certain capacity before we can even enter, then lots of people might not realize that they’re missing out on goat because they go to the meat counter and there’s beef, chicken and pork. Suddenly if goat producers like Zamgoat are able to hit a certain capacity and making them looking at beef, pork, chicken, goats, Oh, actually I’ll try goat. And that introduces it to, and that generates the demand. I can see that. I can sort of see that logically being something.
Paul: 51:25 Yeah, sure. So I think there’s just a general stereotype that is somehow you know underplaying or downplaying the efforts or the opportunities that exist within the goat industry like, you know, experience. Okay. One of the challenges that we have been facing, for instance, even in trying to access, you know, growth, financing opportunities out there is this seemingly unattractive, still unattractive state of the industry as a whole. Not for us as a business, but the Industry as a whole, you know, to attract financing from traditional financing sources that want to find us businesses, operating industries or in proven industries in other words, industries That have got a proven track record. Industries that have got a proven record for commercial viability. Whereas, you know, theygoat industry has never been exploited, fully exploited. So the financial markets out there are still a little bit skeptical, you know, especially the traditional sort of funding or finance.
Sam: 52:37 So where, where do you get your financing from?
Paul: 52:39 So given that reality, we’ve mostly be looking at non traditional financing sources, we’ll be looking at, like here in Zambia, the commercial, the most common source of financing for any start up business would be, you know, to go to the bank and ask for a bank loan. But then the banks look what industry dynamics, the goat industry, they have no experience with it so they don’t have that, or technically, you know, cuts you off their books. So we’ve been looking at nontraditional financing sources like, you know, venture capital, equity financing, we’ll be looking at impact financing and especially like in our case, especially given the impact, the social impact aspect of our business. We’ve been trying to take advantage of, you know, development, financing opportunities that exist out there.
Sam: 53:36 As you say, you, are improving livelihoods of small holder farmers. And that must be…
Paul: 53:41 Sure.
Sam: 53:42 A really big impact push that people want to have.
Paul: 53:45 That’s sort of what I’ve been trying to do. I’ve been trying to ride on, you know, impact aspect as a business in accessing impact financing opportunities, which we hope we should then be able to use as catalytic, you know, financing that help us grow the business to reach a level where at least now the business and the industry as a whole should be able to prove a point and become more attractive to a traditional finances. Yeah.
Sam: 54:14 Got it.
Paul: 54:15 So it needs a lot, a great deal of catalytic financing from non traditional, yeah.
Sam: 54:22 Get it in motion. Yeah.
Paul: 54:23 Sure.
Sam: 54:24 Okay. So we’ll just do a few more questions, that’s right. What have been some of the surprises in running the business? So if you were to say compare, what, how Zamgoat is today with what you thought it would look like today? How is it different? Maybe in a positive way, and in a negative way.
Paul: 54:46 It’s not as easy as I thought it was going. Okay. Yeah, that’s one thing obviously. So running the business hasn’t been as easy as I thought it was going to be. It has been a lot tougher, stressful, and sometimes you know, tempting, you know, you just want to quit. But then again you look at, you know, the time invested and the beaconing opportunity ahead, okay. The fact that there’s no track record for commercial viability of the goat industry does not make it, you know, a bad industry as a whole. Okay. I think there are a lot of positive indicators that this is the next big thing in the meat industry, this is the next big meat industry in the world. The goat meat industry.
Sam: 55:42 Yeah.
Paul: 55:42 Okay. Yeah. So just getting back to your question, my experience has been that, I think still a lot more harder. I didn’t think it was going to take us this long, you know, to grow the business, by now, I was projecting that, we are now doing seven years, by now, my initial projections were that by now we should be able to at least saturate the local market and looking at export markets. But it’s been difficult because it’s been hard to raise, you know, growth financing. Yeah.
Sam: 56:18 Okay. And, if you sort of fast forward, project maybe three years time, what do you think Zamgoat will look like?
Paul: 56:27 So in three years time, especially if we manage to raise the initial $400,000 that we are looking at, one, Zamgoat should be able to fully become a household name on the Zambian market in terms of goat consumption. We’re also looking at changing the consumption patterns of goat among consumers. Okay. For instance, we’ve introduced these revolutionary products, goat burgers. Okay. These are products that have never existed in the Zambian market, but now have, they’re only on the Zambian market. People are getting hooked to our concept, goat pizza, pies and pastries, you know, so in three years from now, yeah, we should be able to really spread our footprint in terms of our distribution outlets across the Zambian market, by the fourth year, there about, who should be looking at exploiting the export market. We have a yearning regional export market, the Congo DR, Angola, is just one of them. Okay. Historically, Zambia has been supplying goats to these markets, but this has been done through informal trade, not through formal trade.
Sam: 57:44 Yeah.
Paul: 57:44 So there’s no really, you know, greater benefit that can be tracked down. And then, yeah. And also in four years we’re looking at increasing our capacity in, you know, engaging with smal holder farmers, in improving their economic wellbeing, giving them an alternative in terms of their livelihoods, especially in the wake of climate change where their traditional agricultural practices are failing. Rainfall has become more predictable. So we want small holder farmers to continue earning a living even at least through raising of goats, which are much more adaptable to the harsh, you know, climate conditions that we are currently experiencing.
Sam: 58:35 That’s good. Okay. Yeah. Cool. And people who are listening, how can they learn more about that and Zamgoat?
Paul: 58:41 So people can visit our website, zamgoatgroup.com. We’re calling it zamgoatgroup.com because we envisage ourselves to grow into a group of companies. You know, it’s time. So zamgoatgroup.Com, people can visit that website and get more information. Alternatively, they can find us on Facebook. We have Zamgoat products limited on Facebook. They can, or simply key in Zamgoat online. There’s a whole lot of information and they’ll get links to sites that they can then, you know more about Zamgoat.
Sam: 59:15 Fantastic. And I’ll put some links to these in the show notes.
Paul: 59:18 Sure. That will be great
Sam: 59:19 Cool. Well Paul, thanks so much.
Paul: 59:21 Thank you so much Sam. Its been a pleasure talking to you.
Sam: 59:21 You too.
Sam 59:22 Much. So here’s a pleasure talking to you.
