This archive report was first published on 25 October 2019.
Capwell Industries, a leading food manufacturer based in Thika, has made a significant shift in its growth strategy by prioritizing research and development. Founded 22 years ago as a maize milling and packaging facility with 80 employees, the company has grown into a conglomerate with seven product lines and employing 700 people.
According to Rajan Shah, the company's chief executive, the decision to invest in R&D was informed by a growing market for ready-to-drink products in urban areas. The company's R&D team spent two years formulating Yola, Kenya's first cereal milk drink, which was launched recently.
Shah emphasized that R&D is not just about laboratories, but a deliberate effort within companies to promote new thinking towards product innovation based on customer needs. The company worked on various product tastes that were internally tested, leading to the Sh250 million plant investment.
Capwell Industries sources raw materials locally for most of its products, including maize, wheat, and porridge flours, as well as ready-to-cook pulses, rice, and imported pasta. The company closely monitors customer feedback to inform its new investments.
Shah highlighted the need for Kenya to reinvigorate its industrial sector, citing reduced government spending and struggling Kenyans to meet basic needs. He emphasized the importance of creating an enabling environment for manufacturers, including reducing transport costs and easing duty on raw material imports.
Shah also called for the promotion of import substitution, where products that can be locally produced are protected, and foreign products are subjected to hefty duty. He noted that the standard gauge railway (SGR) is suffering from teething problems, which demand urgent government-led talks to find a lasting solution on last-mile transport costs.
Capwell Industries is concentrating on formulating new products and is aware that some traders sell its products across East Africa and as far as Dubai. The company is ready to make its products available across the region as it has invested in world-class machinery that can be scaled as demand rises.
