If you are a keen follower of business affairs in Rwanda, then you know very well that the campaign to encourage Rwandans to buy Made-in-Rwanda products is at full throttle. In fact, several agreements between the Government and manufacturing investors have been signed, with Volkswagen being the latest deal; private sector trade exhibitions showcasing local products have been organised and successfully attended; and fashion shows that shine light on local designers are also on the rise. But, as 2017 begins and the momentum to promote local products and also cut the trade deficit picks up (the National Institute of Statistics recently reported that total imports dropped 8.68% to $439.39 million in Q3, 2016), I maintain that success of Made-in-Rwanda products does not depend wholly on whether the local market is satisfactorily stocked with local products. It is my opinion that success of this campaign hinges primarily on whether or not suppliers of Made-in-Rwanda products truly understand how people make purchasing decisions - a blinding glimpse of the obvious but nonetheless true. You know, for the best part of 15 years, as a consumer, I have made countless purchasing decisions, some big, some small. And, I can safely say that all of these decisions have been influenced by none other than two factors: quality and cost. Occasionally when I have time, I add taste and brand loyalty to this list. But like I said, the last two are minor factors - price and quality - are the king and queen of my decision-making process. Now, when we talk about demand of consumer products and holding all other factors constant, an increase in the price of a good or service will decrease its demand, and vice versa. This is irrespective of whether the product has a Made-in-Rwanda stitch or Made in China. The lower the price… you get it! Of course, I will also admit that rather than draw from my early economic class lessons on price-quality relationship, I occasionally use a product’s price as a measure of the product’s quality, instead of using a product’s price to determine if the product is affordable. For many people, however, the purchasing decision begins with the identification of a problem: for instance, I need a bottle of orange juice to compliment my lunch meal; I need a new shirt for my new job; and so on and so forth. What usually comes after this stage is to identify products that can best address your initial problem; many people use readily available information to identify products and also compare on quality and cost of competing products. Frequently, this information can be retrieved by asking family and friends where they bought their items; while others use internet search engines like Google to identify items, their price, and location The searching-for-information stage is very critical for consumers as it helps them narrow down options, but this stage is even more critical for suppliers because the lack of readily available information disqualifies you from consideration, whereas the more information your products have out there, the more likely consumers will consider your products. Therefore, the use of advertisements, promotion events, discount campaigns, and much more, should not be seen as a luxury for suppliers but as a necessity. And, I am not saying that suppliers need to spend all their earnings on marketing. But refusing to engage consumers is also not the smartest move. Don’t just sit there and assume that just because you have Made-in-Rwanda products sitting on your shelf, consumers will feel obliged to buy them instead of imported products if quality and cost of both products are for instance similar. Usually, after assessing available information, the next stage up for a consumer is to evaluate competing alternatives using quality and cost as the benchmark. At this stage, what Made-in-Rwanda suppliers ought to remember as it will either make or break them, is that in an era of free trade agreements where countries impose few or no tariffs at all on imported products, local consumers see each product from the viewpoint of whether or not it satisfies their needs, and therefore the purchase will be made on the basis of expected value – where expected value for products for many products is enhanced greatly by presentation and packaging. How a product is packaged and presented contributes greatly to how a product is perceived. I remember last year writing an article about how I fell in love with Agashya juice for its superior quality, but was left mystified by little attention given to its packaging. I also remember asking how many Rwandans would be proud to serve the juice to their distinguished guests from its original packaging! Markedly, it is true that national loyalty or economic patriotism may indeed play a role in helping suppliers of Made-in-Rwanda products succeed. However, economic patriotism, a concept on the rise as a result of increasing challenges posed by globalisation and somewhat epitomised by a growing number of countries choosing to look inward rather than pursue outward economic policies, can play a role in encouraging us Rwandans to buy Rwandan products, but that concept, I maintain, must be complemented by Made-in-Rwanda suppliers truly understanding exactly how people make purchasing decisions. I also acknowledge that manufacturing in Rwanda is relatively new, which is why I have gone easy here; but as production capacity improves, costs of production decrease, and competition spurs more innovation, it won’t be enough for suppliers to make shoes, clothes, produce juice, prepare milk, eggs, and so on. As suppliers benefit from increasing economies of scale and favourable government economic policies that aim to address the trade deficit challenge, they will also need to start addressing challenges that are within their reach: consumer-driven marketing needs to be taken seriously; process-improvement to address quality issues cannot be underestimated; and the issue of product packaging must be taken seriously. Failure to be mindful to such challenges only sets a stage for more imports and a wider trade deficit. You see, there are many competing alternatives products out there – privately, if improvements aren’t carried out, economic patriotism to buy from our own may come second best to price, quality and other factors. junior.mutabazi@yahoo.co.uk
