Friday, February 26, 2010

Setting up business in Maputo

I have always dreamt of setting up and running my own business in ‘Africa’ and when I finally got the opportunity to do exactly that in 2008, I jumped at it. Working 9-5 felt like a prison, something I have decided I will never go back to unless I am desperate.

First, I needed to find a low cost business idea that would bring in cash immediately since I had small savings. I immediately found out there is no information or support for low-cost start-ups in Mozambique. You have to go out there and do your own market research to find out gaps in the market and the legal requirement to setting up a business. This was further complicated by the fact that I did not speak or understand a word of Portuguese, Mozambique’s official. So, I spent about 5 months speaking to expatriate community, local people and business owners to see if I can identify a gap in the market, a service or product that is not already provided. This is a totally random and inexact science, and it was risky to base a business on unreliable and sometimes contradictory information I received. I had to use the information I gathered and spend hours visiting shops and businesses to see what was already available so I could workout what was missing. I also spent a lot of time with my ex boyfriend at the time to find out what he missed the most from his life in Europe, he thought there was not enough choices for lunch for office workers. At first, I didn’t recognise this as a potential business idea but kept talking to him and few other friends about all the potential business ideas I have thought about thus far. This shortage of lunch options kept coming up in conversations and thought maybe it was an idea worth exploring.

As part of my research, I spent a lot of time eating in different restaurants and cafes and realised there is definitely a gap in the market for light and healthy meals. An alternative to either rich fried meat dishes or the greasy Portuguese-style toasted sandwiches. I approached a friend and she agreed to come on board as a minority share-holder and we immediately started working on putting together a healthy light meal business concept with a menu and company brand. We were very lucky and a graphic designer friend agreed to help us design the logo and the menu for free, an extremely generous offer which saved us a lot of money.

The process of going from an idea to actually creating the company was very exciting and one of the most enjoyable projects I have ever been involved in. We started with a company name and a brand style. We googled lots of similar concepts in Europe and we knew what we wanted was close to EAT, a similar business based in the UK, with fresh, simple and locally-sourced ingredients. My business partner had a full time job with 2 kids and she didn’t have lots of time to be fully involved so we communicated on email and phone and I worked on developing the concept full time with the graphic designer friend. We worked for hours almost everyday and we started with names like:

The Lettuce and Tomato, Red Tomato, The Right Bite, The Artichoke, Upper Crust, The Bread Box, The Sandwich Box, LA BAGUETTE, and Pronto.

We went back and forth with the names and at some point realized it is probably better to have a Portuguese name given that we are in a Portuguese-speaking country. That was a bit tricky as my business partner, our graphic designer friend and myself are all foreigners and between us we only spoke enough Portuguese to order a greasy toast and glass of wine!

We crossed out most names and in the end we all agreed Pronto was the best name, simple, Portuguese, and reflected our business concept perfectly. Once we agreed on the name, it was easier to play around with colours, fonts and style to create the brand and company image. The next step was to figure out what kind of packaging to use and we decided that given our tight budget we didn’t have enough money to set up a proper café and would run a home-based lunch delivery company instead.

Sourcing packaging in Maputo turned out to be a lot more complicated than we had anticipated. We found out there was absolutely no sandwich and soup packing material available in Mozambique that was suitable enough for delivery. Everything was imported from South Africa, including simple things like grease-proof paper to wrap sandwiches in. We even went to paper factory based outside Maputo, in Matola, and learnt that they only produced paper packaging for local milk and juice cartons. We met with the director and he informed us our only choice is to source from South Africa. We were very disappointed that we had to source basic things from South Africa as we really wanted to use only locally-source products. We went to the nearest South African city to Mozambique called Nelspruit and to our further disappointment we only found plastic packaging instead of our paper and environmentally-friendly packing idea. So, we returned to Maputo and to the paper factory to see if we can work with them to design our own paper packing. The director was very helpful and promised to identify South African companies that can design our own packing for us. He gave us large sheets of papers for us to make models and my business partner did a great job cutting out professional looking cute sandwich and salad boxes and the director sent them to a South African packaging design company in Durban, South Africa. I thought the models were so good that they were only missing top plastic window to display the food, we didn’t need anymore design work done. We just needed the Durban based company to reproduce the models with simple plastic window. After few weeks, we got back the reproduced models with the plastic windows we requested and we were really pleased with the finished work. Only problem was that the company, to our surprise, have cheekily patented our design and put little stickers notifying us that we could not reproduce our own design!!! We knew since we have designed this in Mozambique and the luck of developed patent law, we could not do more than being pissed off with the company and decide not to work with them. They also asked so much money to produce a simple paper packing. So, that was a dead-end and we had to settle for plastic packaging until we had enough to afford paper packaging.

Next step was to register the company and make sure we reserve the Pronto name before anyone else does. There are two ways to register a company in Maputo. One is to use a company-registering service and pay them a reasonable fee, the second option is to register the company yourself. I wanted to experience the whole process of setting up a company in Mozambique to learn how it worked so we went for the second option. Looking back, I should have just given this job to someone else to sort it out and freed myself to focus on the mountain of work needed to launch the company.

We faced our first hurdle at the first stage of registering the company name. We explained to the officer ‘in charge’ our business concept and told him the name we wanted to reserve. Neither of us spoke Portuguese well and we used lots of gestures and few words to explain. The officer politely informed us we could not use that name for our company! We asked if the name was already taken, he said no, it wasn’t taken but that the company name had to be related to what we were trading in!! Apparently, Pronto was too general a name and didn’t say anything about food therefore we couldn’t use Pronto for a food delivery company!!!. We asked if there was a specific written rule somewhere that stated that? He said no but that he will not register the company unless we added something about food in name. We thought he was joking, but no he was really serious. This took us by surprise and we were not prepared for it. The officer agreed though that publicly we can trade with just the name Pronto. So, we discussed about what else we can add to the company name and the officer shared his ideas. We thought since it is a ready-lunch business idea why don’t we call it…wait for it...Pronto Almoco Ja. With our poor Portuguese, we had no idea just how bad this sounded, lol. Of course, the officer was happy with the name and finally agreed to register it. Later, we found out this literally translated into: Ready Lunch Already!! Hehehe…I decided to keep the rest of the name a secret and only use Pronto. I was glad most people were never going to find out the full name but when we catered to big companies and organizations we needed to give them our bank account details and of course we had to give them the full company name! It helps that people in Mozambique are so polite and no one laughed in our faces, just the odd remarks from some secretaries. Once I improved my Portuguese and learnt a bit more about how things work in Mozambique, I found out if we stood our ground and just insisted on registering the company name we would have been able to register our original Pronto name. I still cringe every time I think of the full company name but it is also a big lesson in not following ignorant advice of those supposedly 'in charge’.


  1. Ahahaha, this is hilarious....I love the name... 'Ready Lunch Already' very useful info for any first time business starters. I look forward to hearing more stories about Moz...


  2. Ajajaja...One of my favourite histories in Moz!
    Look forward to hearing more business plans , you have a great mind for that!!