Long before her rise as the CEO of Melvin Marsh International Limited, the company that manufactures Melvins Tea, Flora Mutahi was an accountant, a job she only held for nine months before she quit.
Mutahi had come to the realization that accounting wasn’t for her and wanted to go into something more exciting, business. But at the time, about 27 years ago, entrepreneurship wasn’t something that was celebrated or taught as it is today. Going into business those days, she says, meant one was a failure and couldn’t get a job.
Her first venture was in free flowing salt where she had seen an opportunity before quickly realizing that it was going to take long to make money because a ton of salt was only $100. She had to come up with another business idea.
“I used to put ginger in my tea every day. And that’s where the idea came from,” she says about how the idea for ready flavoured teas was born. “And I asked myself, ‘how many people are like me?’, so I launched the two together, plain tea and ginger tea. And when I started taking it round to the shops, the ginger tea took off.
“That’s how I found an opportunity in tea and almost immediately, I got registered. Also, remember this was when a government monopoly on tea had just been lifted.”
Within two years of launching the ginger tea, Mutahi started challenging herself and asking “what next after ginger tea?” She then came up with masala, cinnamon, cardamom and vanilla tea flavours. Once again, after several years, she felt challenged to do more, and through the years she has launched more flavoured teas, green teas, orthodox green, purple and black tea and most recently the Melvins pure Kenya chai black tea.
Mutahi did not know much about the tea industry or even how to get into its manufacturing, but she was willing to learn. When she went back to university to learn about tea, she found a lecturer who made her commit to three weeks every afternoon, when he was free, to teach her about the principles of food technology. The rest, she learnt on the job and through tea tasting.
“I went into tea tasting, and this is very funny, incognito at KTDA because if I said who I was, I knew I wouldn’t get an audience. I had to say ‘I’m a student’ and I wore the white coat and tasted 100 cups of tea a day for three weeks. Now I can taste my own tea. Now we are big enough to have tea tasters and tea buyers, but at the beginning, that is how I did it,” Mutahi says.
Although entrepreneurship has become increasingly popular in recent years, the truth is that it is not suited for everyone. Not everyone will understand risks much less be comfortable with them.
Entrepreneurship is also about solving new problems, engaging directly with customers, selling, dealing with financial reports and building a product or a service that will eventually be maintained by a small team which sooner or later grows steadily into a company.
Still, Mutahi believes in getting into entrepreneurship early enough and learning, if it’s an area one wants to explore. Further, she says one has to develop an inquisitive mind and have the resilience to persist.
However, the world of business comes with numerous challenges and Mutahi breaks them down to three: access to knowledge, access to research and access to finances.
One of her biggest headaches when she was starting out was access to research, without which she couldn’t find out how big the gap in the market was, what the market was like and the demographics. Without this research, she turned to holding focus group discussions, which cost money that she didn’t have.
“When I began, I couldn’t afford to do focus groups, and yet I needed them. One time when things with my team were just not working and I could not understand why, somebody suggested that I should host one focus group. I did that and pretended to be one of the scribes. I went in and I heard people hammering my product. My goodness! It was the most devastating time,” she says.
However tough the feedback was to hear, Mutahi came to learn how Kenyans take and make their tea and which blend she needed to make that is perfect for them. The biggest challenge for her, however, was access to capital to get her business off the ground.
Naturally, the first people she approached were her parents, who responded “si ulikataa kazi (didn’t you quit your job)? No, there’s no money here.”
But her mother, after seeing her passion gave her whatever little she had, before she later turned to Kenya Women Finance Trust for a loan. But the money was still not enough.
“So, what did I do? I started bouncing cheques and promising my suppliers. I also borrowed from Saccos and friends. I would do anything just to get the product on shelves. I had a few embarrassing moments like there’s a day I bounced about five checks, but it was not a criminal offense like it is now,” says Mutahi.
Access to capital remains one of the biggest challenges for women, limiting the establishment, expansion and growth of their businesses. She says access to capital is still an issue for women because of lack of collateral. Often times, she adds, the collateral may be in the name of the family or the husband and convincing them may be difficult.
These barriers exist because women do not have collateral and are not expected to be in business or scale their businesses, Mutahi says. “When we get rejections, they never really say why… it’s always about increase your collateral. So sometimes we really don’t know if this is bias or not.
However, in my 27 years of doing business, I do know that there are biases against women. We’ve always said loan officers should be as much female as they are male. And we also should look at different ways to secure the banks when they’re lending us the money,” says the manufacturer.
Another challenge women face, Mutahi adds, touches on networking whereby women have to rush home after work to take care of their families. She, however, says there are ways to work around the obstacles: for networking – network when you meet people in the gym or church. For collateral – get assets in your name and when your banker says no when you’re applying for a loan, be bold and aggressive and ask why.
“There are a lot of financing alternatives these days, like balance sheet financing, stock loan and leasing. There are other ways to skin the cat, but above all that, learn, read books and ask questions,” says Mutahi.
Currently, her vision for the company is to scale up and grow exponentially, and KCB Bank has been instrumental in helping her expand the business.
She approached KCB Bank several years ago when she needed a mortgage to start her own plant, and there, she says, she met the friendliest banker and after a few meetings, the Bank agreed to give her a mortgage.
“Everybody wants a home; everyone wants to belong and stop paying the landlord. So for us the fact that we’ve now began the journey of purchasing, we are going back to KCB for development. And before we know it, we want to have our own factory that people can come and tour because right now we are very cramped,” she concludes.