Mohammed Hamid: From Vending To Shs900bn Aya Empire

This is one genre of stories that is set to enjoy an ever-lasting appeal: a real rags to riches tale. It is a story of heroic struggle against odds, survival and eventual triumph. The story of AYA Group boss, Mohammed Hamid.

“This is my story. I became the C.E.O of Aya empire from street vendor through having a clear vision and goal, determination, hard work, focus, self-confidence and overcoming obstacles and disappointments and so many other challenges,” he begins.

FROM RAGS TO RICHES;Mohammaed Hamid with his family
FROM RAGS TO RICHES;Mohammaed Hamid with his family

Hamid is now one of Uganda’s most successful and prominent entrepreneurs. He is the Chairman and founder of Aya Group, a $200 million (annual revenues) conglomerate with interests in milling, food manufacturing, commodity trading, transportation and hospitality.

Hamid, 39, originally from North Sudan, traveled to Uganda as a teenager in 1987 to briefly visit his elder brother who owned a successful trading business in the country. He fell in love with the country and decided to stay on. He has since become a citizen. In the last 28 years, he has built one of Uganda’s largest privately-held conglomerates. Hamid is currently concluding construction on a 5-star Hotel in Kampala, which will be managed by Hilton.

Uganda has a lot to offer to those that are determined and I am a witness from my humble beginnings as a youth 27 years ago to date.

“I hear some youth blaming others for their failures; from my personal experience, I have learned that the minute you shift the responsibility of your failure to others, it means you have surrendered to your failure,” Hamid told the story of his success.

At 39, Hamid is easily the second richest African Under 40, after Tanzanian multi-millionaire, Mohammed Dewji, according to Forbes.

Early childhood

I was born in Sudan, but I have been in Uganda for many years, so I consider myself Ugandan. I came to Uganda for the first time in 1987 to visit my elder brother, Mohammed El Hamid, who runs Pan Afric Impex, a commodity trading house.

I had just completed High School and was preparing to go to the United States for further studies, but I decided to come here to visit my brother. I fell in love with this country and I saw a lot of opportunities here. So I asked myself, why am I going to the States to study, when there are many good Universities here in Uganda??Eventually, I decided to stay in Makerere University where I pursued studies.

My elder brother was already a successful businessman in Uganda, and I saw that this country was a virgin land with many opportunities. I have always had a knack for business and an eye for opportunity, so I decided this country was the perfect place to start and build a business.

First business

When I decided to study and live in Uganda, I joined my brother in his commodity trading business. It was tough because I was pursuing a degree in business and at the same time, I had to work with my brother. But those were defining years for me. I learnt about time management and prioritizing tasks.

I learned the ropes of trade during those years. After working with my elder brother for a few years, I set out to launch my first business which I called Pan Afric Commodities. This was in the early 90s. I raised money from my brother and used my own savings and began to import wheat flour, juice, sugar, rice, beans, vehicle tyres, biscuits and wheat flour- anything that could deliver a decent profit margin. God blessed me and I became a millionaire within a short time.

Going into Manufacturing

Uganda is a landlocked country, so whenever we imported wheat flour, we had to store it at the Port and warehouses in Mombasa, and that came with its own challenges.

Our flour could get contaminated since it usually has a shelf life of only six months; some of it could be stolen.

So I decided it was time to build my own factory, because rather than import wheat flour that had a shelf life of six months, I could import wheat grain which has a two-year life shelf and process it into wheat flour, and make a healthy profit. So in 1998 I bought a milling machine from Premier Mills, a company which was owned by Sudhir Ruparelia, Uganda’s richest man.

We moved the factory to a 15-acre piece of land I had acquired in Kawempe, near Kampala, and we started our milling company from there. We are now the largest milling company in Uganda, producing more than 20,000 tons of flour per month. Aya Mills contributes more than $100 million annually to our group. For now, it is our largest business.

Success in the wheat

There is a popular meal in India called Chapati. It’s also a popular meal in neighboring East African countries like Kenya and Tanzania, but it was not as popular in Uganda ten, twenty years ago. So we capitalized on that. We actually introduced the majority of Ugandans to Chapatti as a healthy and alternative meal choice. Our marketing strategy and most of our advertising was centered on Chapati, and of course wheat flour is a major ingredient when you make Chapati. We went around showing people how to make Chapati with Aya wheat flour, and Chapati is delicious, so before we knew it, everyone in Uganda had begun to accept Chapati. Everyone associated Chapati with Aya flour, and that association worked in our favor. We have never stopped producing affordable, high quality flour, so we dominate the market even till this day.

Our milling business succeeded rather quickly on account of the fact that we introduced Chapatis to Ugandans. As we kept producing our wheat flour, we realized we would make a lot of money if we simply added value to the wheat flour. As a businessman you are always looking for the next opportunity, so I realized that the flour I produced in my mills could be used to make biscuits, bread, and other baked goods. So in 2000, I approached the Export Import Bank for a loan to set up additional milling factories. I added my savings, and I bought additional milling machines from Italy and established 2 more milling plants. Now we are the largest bakery in the country.

Transportation and mining

As I said earlier, as a businessman you are always on the lookout for new opportunities. As our milling business grew, I realized that we were spending ridiculous amounts in contracting haulage companies to transport our goods to distributors and retail outlets around Uganda. So I decided to set up my own transport company, so I bought 100 trucks and began FIFI Transport Uganda Limited, which is now a leading hauler in the East and Central African region. We now have a fleet of more than 3,000 Mercedes-Benz Actros trucks which are capable of handling containerized and bagged freight. Our mining business is still relatively young. We are scouting for gold and we have licenses in quite a few regions. When we make a major discovery you will be the first to know.

Employment

I employ more than 5,000 people across all the companies in the group. I make it a point to hire highly professional managers for my businesses- people who are committed to their job. I motivate them and provide the support that is necessary.

Links with Museveni

President Museveni is a friend to anyone who is a friend to Uganda. For as long as I can remember, one of the President’s key mandates has been to support the private sector and to provide them with the enabling environment to thrive.

President Museveni charts with AYA Group Executive Chairman Mohammed Hamid
President Museveni charts with AYA Group Executive Chairman Mohammed Hamid. Hilton Hotel (in the background) is part of the empire

President Museveni for the past two decades has provided stability. Uganda is one of the most stable countries I have seen around the world, and with stability, businesses thrive. The Government is always there to support private sector. If you want President Museveni to be your friend, just do good business here. The President is a partner to everyone doing good business in Uganda.

Challenges

The only problem is the fact that we are landlocked, so you find you have a problem with logistics. The nearest port to Uganda is in Mombasa, so goods sometimes get stuck in Mombasa. Apart from that, everything here is fine.

Hilton Hotel

It’s a large project. It’s costing us in excess of $200 million. And if you are spending that sort of money on a project, you dont want to rush it. You want to take your time to build something of world-class standard. I signed a management contract with Hilton Hotel so it will run by them. We are taking our time to ensure we build the best Hotel in Kampala. We have money. I have a long-term syndicated loan from several banks for this project. I have also put in my own money ?tens of millions of dollars. We never planned to rush it because we cannot afford to make any mistakes. We expect to open officially the hotel for business this year.

Future plans

I want to mention that as a contribution from us to youth development, we are establishing the Uganda Youth Development Agency (UYDA), a program that is aiming at creating over 300,000 jobs. Special thanks to our government under the leadership of President Museveni for ensuring equal opportunities as seen last year with parliament passing the bill to see Ismamic bank open its doors into Uganda.

 

As told to Prisca Wanyenya