You will never know the extent of the Innoson enigma until you come closer. By the time you have (as we did) toured the Innoson manufacturing plants, you will realise that right here in Nigeria, is a re-incarnation of a Henry Ford and his types in America, Japan and elsewhere; people who did not obtain fanciful or high-sounding university degrees and yet went on to perform technological feats that changed their immediate environments – and the wider world arena – for good.
When our editorial team was about to depart from the premises of the Innoson Vehicle Manufacturing (IVM) factory in Nnewi, the industrial city of Anambra State, his manager of 25 years standing, Mr Nnamdi Onusogu, warned us not to expect a “giant filling the whole room” when entering into the presence ofChairman of Innoson Group, Chief Innocent Ifediaso Chukwuma (OFR) the Okpu Uzu Ndi Igbo N’Ine, a Nigerian Centenary Award winner and winner of the Vanguard Newspapers MOST INNOVATIVE INDUSTRIALIST OF THE YEAR 2013, among 35 other awards, honours and recognitions.
When we walked into the rather spartan corporate suite lodged in the second floor of the three story head office building in Abakaliki Road, Emene, Enugu we found a rather youngish, rough-hewn man sitting behind a modest, cluttered bureau and staring at us with a blank expression as we came through the doorway. He welcomed us and bid us sit down.
Innocent is a weather-beaten, dark complexioned man with a big mark on his right cheek: a man straight from the streets. Nothing about him gives a hint of his billions and chains of manufacturing businesses. Rather, he looks like a typical factory grunt worker; at best a unit foreman.
The furnishing and the airs around his office illustrate the surroundings of a typical Igbo trader, and these are people who are not much into the glitzy shenanigans of corporate “big boys” of Lagos and Abuja.
When he needs to get into his elements, he brings out his snuff box, puts a tincture in his palm and feeds his nose. He is that kind of “local man”. But when he speaks he has a surprisingly mild, unpretentious voice.
In an interview he granted THISDAY on March 1, 2014, Chukwuma explained why he does not have a “big-town” carriage: “I am from Uru village, Nnewi. I have lived all my life at Nnewi. I do my business at Nnewi.
I have not left Nnewi for any other place. Up till now, Nnewi is still the headquarters of my chains of businesses. I started my business at Nnewi. I grew my business to what it is today at Nnewi. I came to Enugu because of the factory that I sited here. Nnewi remains my main base”.
He had on a pair of well-worn blue shorts and a white polo shirt. When he realised we were going to take photos of him, he excused himself, went into the bathroom and emerged a couple of minutes later, dressed in casual trousers and another dull grey t-shirt.
He sat down and told us he was ready. No long protocols or elaborate niceties, but straight to business.
Innocent started as trader but has exited that area and moved into big-time manufacturing. His Group consists of: Innoson Nigeria Ltd, makers of motorcycles and spare parts; Innoson Tech and Industries Ltd, plastics and household items makers; Innoson Vehicle Manufacturing (IVM), auto makers and General Tyres and Tubes Co. Ltd, Enugu, which is being run by his 26 year-old son, Nonso.
The plastic factory is the largest of its type in Africa, and produces not less than 150 different items, from motor and machinery parts to office and household necessities. It took us two whole hours to complete the tour of the factory, which is sited at the headquarters in Enugu.
It is a major achievement that such a mega-factory is thriving in a country where foreign multinational companies have been shutting down and escaping to neighbouring countries like Ghana due to unfriendly environment in a country that rates among the lowest in the world in doing business.
Innocent was born in 1961 into a humble family. His father, Mr Godwin Chukwuma, was a junior civil servant, while his mother, Mrs Martina Chukwuma, was a housewife. He is the last of six children: four males and two females.
Incidentally, Innocent has as an elder brother who is another ebullient grass-to-grace Nnewi-born-and-made multibillionaire, Chief Gabriel Chukwuma, alias Gabros, the proprietor of Gabros International FC of Nnewi. Gabros, who started as a patent medicine dealer, has also abandoned trading to emerge as one of the big-time players in the hotel and real estate business in the country. He was the third child of their parents.
In the beginning…
It all started in 1978 when Innocent completed his secondary school education. He was certainly not the top-of-the class type.
He was interested in reading engineering at the university. While he waited for his result he decided to report to the medicine store of his elder brother, Gabriel to occupy his time. He immediately discovered that he had a natural talent for trading. When his result came out he was unable to make the grade required for him to go for further education. By then, he had made up his mind to be a businessman, anyway.
His elder brother wanted him to learn how to trade on motorcycle parts. He was given to Chief Romanus Eze Onwuka, who became his Master. Eze Onwuka is otherwise and more popularly known as Rojenny, the founder of the first private sports stadium in Nigeria. Rojenny Stadium is located at Oba, near Onitsha.
Incidentally, it was there that Gabros International FC owned by Innocent’s elder brother has been playing its home matches, thus leading many to think that Rojenny is owned by Gabros International. The truth is that Gabros, Rojenny and Innoson form an Nnewi multibillionaire triangle that germinated and grew on the fertile soil of traditional Igbo entrepreneurship practices fertilised by honesty, trust and mutual reinforcement of the trio.
In 1978 Rojenny, Innocent’s master, was the biggest dealer on motorcycle spare-parts in the Nnewi Market. Innocent was to spend six months with his master, but at the expiry of the tenure, Rojenny came to Gabros and asked him to allow teenager to spend two years with him, offering to set him up in business with his own resources rather than the family looking for the money to do so. Gabros, who knew the value of his younger brother, turned down the offer, assuring Rojenny that the family was quite capable of funding Innocent’s start-up.
In 1979, Innocent returned to his brother, who promptly registered Gabros International to trade on motorcycle spare-parts. Innocent was given the sum of N3,000 to start, and he was allowed free hand to run it.
It was from this money that he rented a shop and bought his first merchandise. By the end of the year 1980, the company took stock and discovered that Gabros International Ltd under Innocent’s able hands was making more than ten times income than the medicine store. Gabros closed the medicine store and together with Innocent, paid full attention to the spare-parts business.
Apart from having a natural talent for trading, Innocent started early in his career to adopt the strategy of buying in bulk and selling with minimal profit. He also went along with the old saying: ‘Honesty is the Best Policy”. This enabled him to win the trust and support of his suppliers on the one hand and amass a large number of customers on the other.
Unlike other traders, especially the hungry youth in the market, Innocent refused to cut corners. Rojenny became so fascinated by Innocent’s sense of integrity that he told a gathering of young traders in Nnewi market way back in 1980: “This boy, innocent, will be richer than all of you here one day soon!”
When our team told Innoson we would like to interview Rojenny, he immediately switched on his old and inexpensive Nokia phone and Rojenny was on the line. Innoson spoke in Igbo, the phone on speaker.
“Heei!” Rojenny hailed from Nnewi, ““Okpu uzu gburuburu!” (Igbo term for technology giant). Innocent announced:
“A group of journalists are interviewing me. I am granting them a big interview that will go out to the whole world. When I told them about you they said they want to interview you”.
“Very good”, said Rojenny.
“You can now speak with them sir. The speaker is on”.
Interview was conducted in Igbo. “Chief, ndewo(greetings). We are from Vanguard Newspapers. We gave Chief Innoson an award …”
“I will tell you everything. I will tell you the secret behind his success. He is the most honest person I have ever met in my life. And he is going with my blessing o! I am the one that nominated him as Okpu uzu Ndi Igbo”
You know there is already Okpu uzu of Abiriba, Chief Onwuka Kalu.
“No, this one is Okpu Uzu Ndi Igbo N’ine. All Igbos worldwide. He has already been installed as Okpu Uzu Ndi Igbo N’ine. I first knew Innocent through his honesty and intelligence. Among the hundreds of other young boys who were into trading, I was like their godfather.
I was the one that copied Japanese technology through Taiwan manufacturers and brought it into the country. And I was the highest importer. When he comes to me he will tell me the honest prices of the spare-parts.
When I ask other people the prices they were selling to retailers they will undercut the price and tell me lies to maximise profit while I will sell at a loss. But innocent will tell me the true price. I used to be shocked at his honesty. He was the only one telling me the truth, and the truth was shocking me to my marrow. And even at that he will buy about 25 to 30 per cent of my entire stock.
And he will be selling almost at the price of an importer. The other people will undercut the price, buy low and sell at cutthroat prices to the final consumers. And I told not only him but the others also that this boy will be the richest among them. I am happy that my prediction has come true in my lifetime.
And even today, the wealth has only started, yet he is still very humble, very honest. The volume of money he has made has not entered his head like other Igbo men. He is humble like me, his Master, the Ogilisi Igbo.Ogilisi is a tree that is respected and valued in Igboland. The boy is too much. He is too much.”
That was in 1981. When his brother, Gabriel, decided to get married a decision was made that Innocent should start his own business and become independent. Gabros gave him N20,000 to start. Being the mainstay of Gabros International, was this amount okay with him?
“I was quite okay with money”, Innocent said. “Even if he gave me less than that. I had made my own money and I knew the business very well.
I could have coped very well with anything. I then registered Innoson Nigeria Ltd. I believe even now, in putting a small profit margin and selling in large quantities. That is why I always have many customers.People know me as someone who uses little profit to sell; so many customers want to buy from me”.
At every juncture that Innoson broke new grounds, he was always led to it by necessity. The old sayings that necessity is the mother of invention, and that in every crisis there is opportunity fit his circumstances like a glove.
For instance, in 1984 when the military intervened and introduced an economic regime that led to scarcity of all categories of goods, many companies closed down. Leventis and other companies were no longer able to supply goods and Innocent had to look for greener pasture in Asia.
He went to Taiwan and applied the same business principles he had used to win over Rojenny in Nigeria: honesty as the best policy. His Taiwan partners started giving him credit sales. The banks in Nigeria started scrambling to loan him money because he never defaulted and his business was booming.
But the prices of motorcycles, just like cars, kept climbing as a result of the deteriorating value of the Naira and other unfavourable economic policies of successive military governments. Businesses were suffering. Innocent started looking for ways of bringingdown the cost of motorcycles to increase sales.
The next decision he took ultimately led to the establishment of two mega-companies that shot him to limelight: the Innoson Vehicle Manufacturing (IVM) Nnewi and Innoson Tech and Industries, Enugu, the largest plastic manufacturing plant in Africa. He tells the story himself:
“As time went on, most machines that were brought in from Japan became very expensive. I was looking for ways of bringing down the prices of motorcycles and their spare parts. So I went to China and found out that it was cheaper for me.
I found out that the motorcycles from Leventis were expensive because they were only able to pack forty units into a 40-foot container. Because of the experience I had in motorcycle spare parts, I went there and asked them to strip it down to pieces.
That way I was able to pack over 200 units of motorcycles into the same 40-foot container, while others were packing 30, forty pieces. I will bring the spare parts down here and couple them manually. Because of my experience in motorcycles I found it very easy.
All I had to do was hire some boys and mechanics and I taught them how to couple them back. That time (around 1987) they were selling a single unit of motorcycles for N150,000. I was the first person that brought Jingcheng in Nigeria. Jingcheng is Suzuki equivalent from China Jiachi is Yamaha equivalent, nothing different.
“Later I decided to brand my motorcycles Innoson. I coupled them manually and sold them for N70,000 to N80,000. THE FIRST ONE I BROUGHT TOOK ME ABOUT THREE MONTHS TO SELL BECAUSE PEOPLE WERE NOT SURE OF THE QUALITY OF MY BRANDS.
When I brought my second order from China I sold the five containers consisting of over a thousand units of motorcycles within one month. I went back, bought ten containers. Before they arrived people had paid in advance and everything was sold even before the containers arrived. People waited for their machines to be coupled to take them away.
There was a time I sold 200 containers of motorcycles in one month that is over 40,000 units. Before people discovered what I was doing and started doing the same thing, I had enjoyed the business for three years. At that time, old tokunbo was about N90,000. I brought brand new and sold for N70,000. And the ones they were selling at Boulos was well over N100,000.
Forcing tokunbo motorcycles out of Nigeria
To make my own cost to come down more, I moved. I looked at a motorcycle and realised that there is a lot of plastic on the body of a motorcycle. I set up a plastic factory. I decided to produce all the plastic components in my factories so that more units of the spare parts can go into a container. With the plastic components, we were packing about 210 units of motorcycles into a container.
But when the plastics were removed they were packing about 240, 250 units. It made the prices of my brand to come down more, so I was still in control of the market. The unit price of motorcycles came down to N60,000. Once we brought the price of a brand new motorcycle to N60,000, tokunbo motorcycle goes from Nigeria”. That was in 2002.
At this point, adversity started setting in. Everybody, including the Indians in Nigeria, seemed to be involved in the motorcycle business. Worst of all, state governments started banning commercial motorcycles as a means of urban transit due to the involvement ofokada riders in heinous crimes and high fatalities. The future of the business became bleak.
“That was when I decided to go into motor manufacturing”, said Innoson. “I did not go into motors overnight. It took me at least seven years before I moved into it. I looked at motor and I decided that they can ban motorcycles but no one will ban motor. I travelled overseas more than six times to study and come up about how to produce motor here in Nigeria. I visited motor factories in America, Japan, Taiwan and China. I am a very amiable customer, and so, I was allowed to visit these factories and I was asking questions though they did not know what I had in my mind.
They showed me what they wanted to show me and that was enough for me to know how to start. I decided we can do it in Nigeria, unlike before when I thought it cannot be done here. I found that that most of the things they do there which makes the whole thing look difficult or impossible can be done here if you adopt a different strategy.
For example, in America after finishing the production of the body you put it on a trolley and push it to another section for another stage of work. But in America and Japan they will just press a button and it will go on its own to the next section. That is the difference between my factories and anywhere in the world”.
While we toured the IVM plant in Nnewi, we were a little dismayed by the fact that many of the vehicle manufacturing processes were still rather manual. The impression created of vehicle manufacturing is that of a highly automated and mechanised process. Asked if he is hoping to get to that level of automation one day, Innoson waxed philosophical and socialist.
“I don’t think we need to do automatic (automation) here because people need to work. Any work that a person can do well should be given to a human being, not a machine. A human being has family to feed and clothe but a machine has no family, no problem to solve except to do its work. All we will do as we go on is to employ more people when we get bigger.
That does not mean that we will sacrifice efficiency in any way. We will give work to the people wherever we can. I am advising people in Nigeria not to do too much automatic. If they do too much automatic they will not employ people.
The major need of this country is to give people something doing. It gives me joy when I see some people that don’t have job and I give them the opportunity to have work. I know that a businessman always wants to reduce cost. Reducing cost is good. But there are some costs I don’t want to reduce. There are certain things we must give a human being to do. People are looking for work. They are begging you for work.
“You have work but you decide to give to a machine. I don’t want to do that. The land where I built the motor factory in Nnewi was given to me free by the community just to make sure that I employ people.
Now if I decide to use automatic where will the people work? In fact, some of our employees when they come here they learn from working in our factory and go out to start doing something of their own. Somebody who was working in my factory before is now supplying me with certain items. He is supplying me boot for bigger buses. Instead of me to be doing it in this factory he produces and supplies based on our specification.
It gives me joy to see such a thing. He learned it from me and went out to fabricate it and supply me. So you have to consider the bottom-line and the people. You cannot sacrifice the people on the altar of bottom-line, but you must also operate efficiently and profitably, giving the society value. My manager in Nnewi, Nnamdi Onusogu, has worked with me for 24 years…”
But we saw that he was using a Peugeot car rather than Innoson product?
“He has been using it and the car is still good. When it becomes old he will pick up an Innoson car. He doesn’t have to throw away the car now.
The car is older than the factory. When the car is old enough we will give him Innoson. Some of our workers are using Innoson. My managers in Abuja and Lagos and here are using Innoson. I am using two Innoson; a pick-up and one SUV”.
But you shouldn’t be riding any other car?
“Why? Am I in a prison? I use any car I like because I have the money. I can afford to buy any car. But I have an Innoson SUV to prove that it is one of the best in the world. I know what people want in SUV and I added a few extras to give Innoson SUV an advantage. I commissioned a German engineer to design it. It is powered by Mitsubishi engine”.
At the Nnewi plant we saw all types of automobiles but no sedans or cars. When we pointed this out, he said cars would start rolling out of the plant from next month (April 2014).
“I am working to have a brand new car sold in Nigeria for about one million or a bit more. It will be a little more than one million when we start but as time goes on it will come down. A car of about the calibre of Toyota Corolla should be less than two million when we start, and the quality will not be anything less”.
His dream is that as soon as the cars start tumbling out of the factory, he will push towards making second hand vehicles (popularly called tokunbo cars) unviable in Nigeria. “You see how tokunbo motorcycle go? Is anybody talking about it anymore?
The only thing it will take for tokunbo car to go from Nigeria is price. Make it cheap and affordable; make the spare-parts available, and tokunbo WILL GO. Who will like to buy an old car when he or she can spend less and by brand new? I must make new one to be cheap so that tokunbo will go in the nearest future. As from April I will flood the market with Innoson cars at cheaper price”.
Luck is on his side because the Federal Government has become very interested in getting vehicles made locally in Nigeria. In fact, President Goodluck Jonathan commissioned the Nnewi motor plant and proceeded to roll out a new national Automotive Policy.
Governments at the federal and state levels are the greatest customers of Innoson Motors, and Chief Innocent is delighted. He would never forget former Governor Peter Obi’s support, which has also drawn patronage from other states such as Delta, Ekiti, Imo and Enugu.
Innocent Chukwuma cannot understand why any young person should sit at home and complain about unemployment.
“Young people should never waste their youth. I never wasted my own. There is work everywhere in Nigeria. The only problem is that most young people don’t like to do “dirty work” yet it is dirty work that gives money. Most of the graduates are not employable. Majority of them have the wrong mentality.
They want to work in banks, oil companies or to become politicians and get rich overnight. There is a lot of job opportunities in farming, but how many young people want to become farmers? The best way to become rich is to go and become a farmer.
“All quick money politicians are making will not last. Young people must use their time as youth to work and build their future”.[Vanguard] tweet