AAF SME Fund Impact: Matonjeni

Business Challenge

Matonjeni is an emerging juice and meal enhancer manufacturer located in Lusaka, Zambia. The Company’s product range includes 6 brands (3 cordials & 3 ready to drink) and a stew mix brand. Matonjeni products are currently sold in Zambia and Zimbabwe.

Matonjeni had limited working capital funding under its operating business plan. The business owned no distribution channels and required significant Capex and working capital investments to ensure its growth and expansion.

Our Approach

The AAF SME Fund has invested a total of $4.85m in Matonjeni since October 2013. The Fund’s approach was to:

upscale production capacity by installing new bottling lines;
decrease production cost by investing in in-house bottle blowing capacity;
implement an aggressive drive to list in all major channels;
work with local banks to provide working capital facilities since the business model requires significant working capital.

Our Impact

Improved Livelihoods

Established a vendor network programme with over 75 vending carts. At maturity, the network is expected to create over 1,000 self-employed business people, with middle-income profiles, in both Zambia and Zimbabwe
Direct and indirect job creation through service providers working directly in the Matonjeni supply chain i.e. merchandisers and transporters

Enhanced Food Security

Set up new production line with 10x capacity
Increased beverage holding capacity from 5,000 litres to 30,000 litres
Installed a 10,000-litre emulsifying tank
Innovative fruit formulation to reduce the cost of producing beverages thereby expanding the company’s market reach across different social classes

Improved Business Operations

Re-admission of Matonjeni products into Pick n Pay, TM, OK and Spar
Increased capacity of filler machine and put-up new bottle blower
Installed a new stew mix plant
Re-engineered all product brands to enhance taste and aesthetic appeal
Launched in-house transport network to facilitate in-house movement for increased efficiency
Negotiated a bank facility with Banc ABC and the Africa Guarantee Fund to open an overdraft facility to fund incremental working capital
Setting up vending network to facilitate product distribution
Concluding a secondary co-investment transaction with a leading Southern Africa FMCG focused PE firm

ESG Impact

Construction of certified boreholes
Enhanced food safety standards through successful registration with local food standards authorities in Zambia and Zimbabwe
Promotion of regional trade through SADCC certification process