Business Profiles

Kencor Management Services – Embracing market change

The agricultural sector of Zimbabwe, a country which up until the turn of the millennium was renowned the world over for its fertile soil and rich farming heritage, has had a torrid time of it in recent years. Just ask the country’s farmers, who have been beset by a long list of disasters in recent years, including debilitating droughts and poor harvests. However, while the industry has experienced its challenges agriculture is a growing market once more, thanks to the hard work and perseverance of the country’s industrious farmers, agribusinesses, and the support of the national government.

Kencor Management Services (KMS) has embarked on a journey which has mirrored to some extent that of the country in which it has done business since 1978. Like Zimbabwe itself, which has experienced its fair share of soaring booms and abject crises, the fortunes of KMS have oscillated greatly over the years, rising to prominence during Zimbabwe’s boom years only to fall away at the turn of the decade, before rising once more in recent times to become what it is today – one of the leading distributors of seed, farming inputs and support services in the country.

With its headquarters in Harare, KMS and its two subsidiary brands, National Tested Seeds and Farm Shop, remain as dedicated to serving Zimbabwe’s hard-working farmers as they were the day the company first opened its doors for business.

“Kencor Management Services is a Zimbabwean company comprised of two trading names, namely National Tested Seeds and Farm Shop,” explained Lance Kennedy, the Marketing and Operations Manager for KMS. He continued: “National Tested Seeds (NTS) is a supplier of quality seed, with a diverse portfolio of different seed types, including vegetable, oilseeds, small grains, legumes, grains and cereals, and has established itself as a trusted brand and a leading supplier of seeds in Zimbabwe. The Farm Shop is KMS’s retail division, which has a network of retail agricultural input stores located in various cities and towns throughout Zimbabwe. The stores provide a one-stop shop to farmers where they can purchase all their inputs, including seed, fertiliser, crop chemicals, animal health, stock feed and hardware.”

As one of Zimbabwe’s market leading wholesale seed distributors, National Tested Seeds supplies the most comprehensive range of seeds in the country through major retail outlets such as OK Bazaars, OK Mart, TM, Metro Peech and Browne, and Electrosales, and is the exclusive agent in Zimbabwe for Rijk Zwaan – one of the leading suppliers of hybrid seed in the world. Not that it is resting on its laurels, of course – as mentioned before, Zimbabwe’s agricultural sector is a growth market, and increasingly the threat posed by new entrants and existing rivals means that market competition is growing. With this in mind, NTS has opted to invest in expanding its range of seed further still, and has made significant headway in promoting open pollinated varieties of maize. Additionally, the recent release of two new seed offerings, NTS 41 and NTS 51, has also allowed NTS to penetrate the lucrative hybrid seed maize market.

This expansion is not exclusive to National Tested Seeds, however. Far from it. Farm Shop is also poised to expand significantly over the short-to-medium-term, in line with KMS’s drive to drastically improve the company’s national reach and presence – a goal which KMS intends to achieve by opening new stores in Bindura, Gutu, Mhangura, and a second store in Bulawayo.

“Farm Shop currently has 21 stores, with the intention to expand its network further by the upcoming season to a total of 25 stores. It has also established its first container store, a concept which it intends to develop further along its main distribution lines to its branches,” Lance stated. He continued:

“With Farm Shop’s continued drive to develop an extensive national footprint, it will assist in making Farm Shop recognised as a national brand, with its brand becoming known by farmers as their preferred supplier for agricultural inputs. Farm Shop will maintain its objective of having small to medium sized shops in high traffic zones, with its emphasis on stock management through logistical efficiency, with buffer stocks being maintained at its head office central distribution hub and at its larger stores.”

Certainly, such an expansion plan, which will have seen Farm Shop more than double its existing national footprint in recent years, is undoubtedly ambitious, and the key to successfully implementing it lies in utilising the company’s extensive industry experience in order to offer a level of service provision superior to that of its marketplace rivals.

In Lance’s view, the holistic approach to business that Farm Shop stores are set to adopt will prove to be the difference in the eyes of its customers. Whereas fellow retailers offer only farming equipment and products to their customers, Farm Shop will go the extra mile by offering customers access to an array of services that boost productivity, including technical expertise and training on subjects such as conservation and zero-till farming, info-educational programs via digital platforms, access to tractor and farm machine hire, access to micro-finance, and importantly, assistance in helping farmers bring their crops and produce to market. “We’ll also continue to develop our product range, including new innovative lines, which we will incorporate into our Go Brand range. We have developed new irrigation and solar power products which are specifically focused at helping small-scale farmers,” Lance added.

Additionally, Farm Shop is also in the process of developing a nationwide agency network of agri-dealer agents, following the award of two grants from the Livestock and Food Security Program funded by the UK-sponsored Department for International Development (DFID). Lance explained: “The first grant incorporated a total of 30, in the Makoni/Mutasa area, while the second grant is currently being implemented in the Gokwe area, again incorporating 30 agri-dealers. The agri-dealers are principally general grocery retailers, who will be given the opportunity to acquire a corporate identity that provides a focus on marketing agricultural inputs. Once these projects are successful, Farm Shop will roll out the project nationwide.”

Since obtaining financial support from the DFID, KMS has entered into fruitful partnerships with GOAL and Palladium. The GOAL partnership is designed to develop Farm Shop’s agent network, with the use of POS computers and an IT software program that integrates into the Farm Shop’s accountancy program, which in-turn will provide the company with greater efficiencies and controls in managing its consignment stock at the different agents. The Palladium Project also involves the above concept, but additionally has tried to promote access for small scale farmers to new and improved technology such as drip irrigation, which comes as kits that can be self-installed by the farmer. The drip kits also include a component of rural finance, since extended supplier credit terms are offered by Farm Shop. Furthermore, the grant provides assistance in developing a tractor hire service that it attached to the local Farm shop, which will provide tillage services including zero tillage planting.

All-in-all, the vital statistics of KMS’s business are impressive, and serve to show that the company has returned to good health following the difficulties of 2005-2008, when the Zimbabwean economy arguably faced its most trying period. That KMS has not merely survived but thrived in the face of an array of challenges, be it the ravages of climate change induced droughts and poor harvests or the drastic effects of government legislation, is testament to the company’s adaptability and resilience – essential prerequisites for any business with aspirations for longevity and ongoing success.

Undoubtedly, Kencor’s 150 staff, a number of whom are long serving, have played an invaluable role in ensuring the company’s survival during its darkest hours, and facilitating its rebirth and growth in more recent times. The art of good business is to ensure that you have a motivated workforce that is invested in your company’s success and committed to helping the business achieve its goals. KMS knows this all too well, which is why the company has taken an active role in encouraging staff to grow and develop both personally and professionally within the business, and offers ample opportunity for internal promotion. The company’s training officer oversees all in-house training, and also provides external resources in the form of training and industry qualifications, to help staff improve their career prospects.

With regards to what the future holds for KMS, the agricultural sector, and Zimbabwe, Lance is optimistic. There have been a number of exciting developments for the company over the past two years, and it is anticipated that this positive trend will continue. Lance concluded on this point, saying: “Kencor will continue to focus on developing both its business models, seed and the retail of agricultural inputs. In this regard, NTS will continue to look to expand its product portfolio with the introduction of new and improved crop and vegetable seeds. Its immediate objective will be to develop the market for the varieties that it has recently released.

In respect to Farm Shop, it will continue to expand its national footprint, firstly to achieve a network of 25 stores and then to further expand the business through its agency network, with the expectation that in the next three years it will expand from its existing 60 agents to 150. Additionally, it will expand its product range to further include new innovative products and technologies for the Zimbabwean farmer.”