An upcoming logistics company

Uganda Investment Review sat down with the Director of Nyaks & Lenny Enterprises Mr Leonard Alikiriza to talk about his company and the SME business environment.

Nyaks & Lenny was incorporated and started business in January 2012. It is a company that specializes in transportation and construction.

The core business is actually transportation. Since 2012 to date we have been handling transportation basically for Tororo cement. We transport raw materials used in making cement for Tororo cement and this is mainly limestone from Karamoja. We do have a plan to transport the finished cement products to the market in the near future. We use dumpers or tippers for this work and we are currently using 45 (forty five) trucks for this work.

The construction work we do only comes when we have successful bids to deliver on. Under construction we basically bid for Government projects advertised by UNRA. When we succeed we do work under UNRA especially on up country roads, feeder roads etc by opening up drainages, supplying gravel and building small bridges.

We have done works in Lira region Under UNRA in 2014/15, in Tororo Kisoko Sub county and in Industrial area in Kampala by supplying the firewood used for burning bitumen.

We have an annual turnover of 8 billion Uganda shs. according to our 2017 final accounts. Our operational office is located on Commercial plaza, Commercial Street Tororo and in Kampala we are based at Ntinda Complex ground floor.

We have two categories of employees comprising the permanent or skilled labour force like the accountants, administrators and Manager who control the administration, these are seven(7) in number. We also have the semi-skilled labour force like the drivers and tonne men, who are over one hundred (100).

Our main client is Tororo cement. We have partners though, who work with us to execute our contracts with Tororo cement. We have suppliers like Gapco and Total, City tyres for tyres and spares and City lubes for service.

We also have some sub-contractors who work under our supervision like Chosen Holdings Ltd, Papertex Agencies, Parambot etc Participating in the Top 100 SME survey, was our biggest achievement of 2017 because we were recognized as one of the Top 100 SMEs in the country. We feel we have been taken to another level because of the exposure and interaction. It helped us to learn and commit to continue shifting from our ad hoc style of operation and embrace the use of systems and organization.

As a company we benefited from the exposure because many people came to know about Nyaks & Lenny Enterprises. Two, it is through the Top 100 SMEs survey that the Uganda Investment Review contacted us for further coverage of our activities by profiling Nyaks & Lenny in this UIA magazine. Three, we had very fruitful interactions with other participants and it helped us to expand our opportunities.

The Top 100 Mid-Size company survey had a big impact on our internal systems also because it enabled us to compare and bench mark with other SMEs that were participating and to pick some ideas that have helped us improve governance systems in Nyaks & Lenny. We however face a number of challenges as an SME business. First, as a transportation business we face challenges of bad roads. In Karamoja, from where we transport raw materials, the roads are impassable during the rainy season. We also face financing challenges, for instance the interest rates that banks charge us are high which makes loan servicing cumbersome. Then there is the taxation from Government, in our view there are so many taxes on SMEs. We are constantly under audit by URA which is a problem.

We are also in need of more partnerships like Top 100 SME survey and the Uganda Investment Review who can help promote us (SMEs) and sensitize us on best business practice and investment.

We expect more support from Government (read UIA) with regard to training and/or sensitization on investment and tax management. We also expect partnerships with equity financiers, who would be preferable to commercial banks.

As an SME company I think it would be beneficial to my company to work with equity firms and/or Venture capital firms if we can work out the details in a win-win way. When equity firms come into your business they look into your accounts, look at your future plan and your internal systems. It’s a way to take the business to another level. I would definitely welcome private equity firms. In the next 5-10 years Nyaks & Lenny Enterprises will grow into a big logistics company advancing from transporting with dumpers to semi-trailers, giving top level transportation services and employing hundreds of people. We are looking at owning more than 100(one hundred) trailers, transporting raw materials form Mombasa and supplying klinker to Tororo cement and other cement manufacturers.