A member of the Hermes family perhaps put it best: “You don’t inherit a family business; you borrow it from your grandchildren.”
Although Africa has a vast array of family-owned businesses at different levels of growth and development, a closer look at the demographics of family-owned businesses on the continent helps us better understand some of the traits of the successful family-owned businesses on the continent. A sure-fire characteristic of successful businesses is the multigenerational business conversation. Families who have nurtured enterprise through multiple generations have successfully become industry leaders and, over the generations, become some of the wealthiest and most prolific. When we talk about enterprising families, the family members do not have to join the family’s initial business necessarily but having enterprise and entrepreneurial nurturing within the family is a typical success trait that we see in many of the most successful businesses on the continent.Â
Family-owned businesses play a role across most sectors, making up a massive part of the economy. East Africa has some of the most prolific, yet reserved family-owned businesses with multiple generations. Research done by Asoko in 2020-2021 showed 645 family-owned businesses earning between $10 million and $100 million in East Africa. In the East African region, 60 percent of family businesses are especially active in the industrial, agriculture and materials sectors. As quoted by another publication, some of these “… big groups offer everything from soap to soft drinks, ferries to fuel.” This focus can be attributed to the small-scale trading roots of a number of these firms, often stretching back many decades and to today’s rising consumer demand, which is driving growth across the continent.
As alluded to in the beginning, the most successful businesses are because of the multiple generations. As we already know, a family business is a commercial organisation in which decision-making is influenced by multiple generations of a family, related by blood or marriage or adoption, who have both the ability to influence the vision of the business and the willingness to use this ability to pursue distinctive goals. The family members are closely identified with the business through leadership or ownership. The multigenerational dimension and family influence that create the unique dynamics and relationships of family businesses make this type of organisation the most likely to last for many years into the future. As the multiple generations grow, you also see the prevalent harnessing of the five capitals of wealth.
Some of the prolific East African businesses that have made the successful generational transition include:
Country: Tanzania
Company: MeTL
Family: The Dewjis
Self-declared annual turnover: $1 billion
Multi-generational strategy: Founder Gulamabbas Dewji developed an import-export business in the 1970s, started in Singida, a town in central Tanzania, in trading, road haulage and second-hand clothing.
The business is trading in 200-plus items, manufacturing a wide range of goods including bicycles and textiles, agriculture, insurance, transport and logistics, mobile telephony, infrastructure and distribution and it is active throughout the region. From humble beginnings, the company is now a billion-dollar business under the son, Mohammed Dewji, group chief executive. Mohammed Dewji was born on 8 May 1975 in Ipembe, Singida. He is the second of six children of Gulamabbas Dewji and Zubeda Dewji. The Dewjis are Twelver Shias, whose ancestors left Gujarat, India, in the late 1800s to become traders in East Africa. “Mo” is the third generation of a family of entrepreneurs. Mo was born when the family was still of modest means, with the help of a neighbouring midwife in the home where his grandmother had her business. His grandmother owned a small trading shop which she operated out of her home in Singida, where Mo was born. From her modest residence, made from mud and sand, she peddled everything from sugar and rice to matchboxes and spices. According to Mo: “She was not particularly rich, but she was very entrepreneurial and had a solid work ethic … She would be the first to wake up very early in the morning, clean the house, prepare food for the family and then open for business till the late evening.”
Mo’s father, Gulam Dewji, would soon take over the business but adopted a more aggressive approach. He began importing soft commodities into Tanzania using family savings and credit facilities. By the mid-1970s, he had turned his mother’s shop into a thriving import-export business. Mo often credits his father with providing the business training pivotal to his success, being quoted as saying, “My father had been training me for business since I was 11 years old. He taught me how to do business. Even as a kid, I remember that whenever there was a school holiday, he would compel me to follow him to work. He would tell me, ‘Mohammed, this is family business. You need to learn the ropes.”
In 1998, Dewji returned to Dar es Salaam to join his father’s business; after two years of working with the company, he became the chief financial officer at MeTL. MeTL Group is the largest privately-owned conglomerate in Tanzania. MeTL was already one of the biggest trading companies in Tanzania by the turn of the century. The company imported everything from sugar and wheat to cotton and soaps, and exported Tanzanian cashews, cowpeas, maise, and everything in between. In the early 2000s, when the Tanzanian government privatised loss-making companies, Mo acquired them inexpensively and turned them into profit centres by trimming personnel expenses.
Even though Mo is the CEO and the controlling shareholder, MeTL is a family business. His father, Gulam Dewji, serves as the group’s chairman, while his immediate younger brother, Hussein Dewji, is the director of sales for the group. His younger sister, Fatema Dewji Jaffer, is the director of marketing for the group, while another brother, Hassan Dewji, is the director of human resources.
Company: Bakhresa Group
Family: The Bakhresas
Self-declared annual turnover: More than $600 million
Multi-generational strategy: Said Salim Awadh Bakhresa is a successful businessman with over 30 years of experience managing a group of complex businesses. He is the founder and chairperson of Bakhresa Group. He was born in 1949 and grew up in Zanzibar. Said Salim Bakhresa opened a shoe repair shop in 1968 and in the 1970s a bakery, ice cream parlour and restaurant. Beginning in the mid-seventies as a small family-run restaurant in the port of Dar es Salaam, today, it is a large entity that has expanded its operations both vertically and geographically. The genesis of the company’s food and beverage operations began in 1983 with Said Salim Bakhresa & Co Ltd. (SSB), the group’s flagship company. The founder of the company leveraged on the privatization program from the Presidential Parastatal Sector Reform Commission of Tanzania to acquire wheat, rice and maize mills, which enabled him to build his empire in no time.
Bakhresa Group’s activities now include manufacturing and distributing dozens of products, the food and beverage sector, trading agricultural commodities, packaging, logistics, marine passenger services, petroleum, and entertainment. The company has further spread its wings beyond Tanzania and is now doing business in Uganda, Rwanda, Burundi, Malawi, Mozambique, Zimbabwe and South Africa. The company also undertakes export of its goods across Sub-Saharan African countries and overseas.
Bakhresa Group is a family business. Said is married to Fathiya Bahhresa, and they have seven children: Mohamed Said Salim Bakhresa, Abubakar Said Salim Bakhresa, Omar Said Salim Bakhresa, Yusuf Said Salim Bakhresa, Khalid Said Salim Bakhresa (deceased 2007) and Mariam Salim Bakhresa. His sons are all Executive Directors of Salim Bakhresa & Co Ltd., the majority shareholder in Azam Media Limited.
His sons also additionally hold the following positions:
Yusuf Said Salim Bakhresa is the Managing Director of Azam Media Limited and is a director in the group. He is actively involved in the day to day operations of Bakhresa Food Products Ltd.
Abubakar Said Salim Bakhresa manages Bakhresa Malawi Limited, Bakhresa Grain Milling (Rwanda), Bakhresa Grain Milling Limitada (Mozambique) and Bakhresa South Africa (Pty) Limited. He is primarily involved in the wheat milling businesses of the group and looks after the wheat procurement for the group. He holds a bachelor of science in business administration, majoring in finance, from Georgetown University, Washington, D.C.
Mohamed Said Bakhresa is the managing director of Bakhresa Grain Milling (Uganda) Limited, Uganda’s largest wheat milling industry. He is a graduate in finance, law and accounting from Southbank University, United Kingdom.
Omar Said Salim Bakhresa, a mechanical engineer, is the executive director in charge of the logistics division of Said Salim Bakhresa & Co Ltd. He has more than a decade of experience in the logistics and transportation industry.
As we can see, Sharing entrepreneurial values keeps many family businesses up and running. Family members joining the family business is not always the only viable or logical element; however, it works out best for some families. It embeds skill and experience into the family itself whilst also allowing outside employees the opportunities to lead and add to the company’s growth. It must be highlighted that educational strategy is a big plus for the family with most family businesses. Next-gens have heavy education investing and at times attend the best schools and get the best technical knowledge that allows them to come home and work for the family business. In the case of Mo Dewji, he was working in a global financial hub when he was then asked to come home and work within the family business. He came with his working knowledge and experience. Although each family is different, strategic planning is essential for the growth of the business. Other essential elements include:
Establishing Processes Over Time
Family-led organisations that survive for five years, a decade, or more eventually reach a tipping point where a process must be established and implemented. Family businesses that thrive and succeed across generations are good at balancing the intimacy and attentiveness characteristic of a family-run organisation with standard operating procedures and codified processes. To grow, family businesses need talent from outside the family; the business needs to ensure a fair, repeatable process and fair policies to attract and retain the skill required for success.
Planning Succession Strategically
Succession is a process at long-lived family businesses, and it is a process that never ends. Family-run companies that survive across generations embrace long-term, intentional, and strategic succession planning. It is not always intuitive, and some families struggle with this and, at times, are plunged into it. However, choosing the next company leader at these companies is so critical to future success that it merits deep, thoughtful, and perpetual planning.
Leveraging the Family Brand
Family businesses that have succeeded across generations know how to leverage the family-run brand to their advantage. Family-run or family-owned and -operated businesses — even just family member-led organisations—tend to be trusted more by customers, clients, and consumers. In the African scope, supporting homegrown can become a movement if defined right, and we have seen many prolific businesses grow because of the trust that is held in the family name and reputation.
Why is this important for Africa?
1. Generational experience develops industries and makes them more robust. Older generations possess the skill and insight that comes from lived experience, while younger generations are often familiar with current trends in the marketplace. When joined together, these assets become a collective strength. It’s not only the communities that are served that benefit. The overall intellectual capital becomes invaluable, and the economic growth of companies prosper.
2. Families that work together tend to stay in areas they invest in, as seen with the two companies whose growth is spotlighted in this article. Their expansion has been in the environments that they are familiar with.
3. Homegrown investment shows significant economic growth, and with the growth of local companies, economic struggles such as unemployment are addressed by partners who are a part of the community and who continue to invest in the communities they are growing in.
