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Home-Grown Peppers, Home-Grown Success: The Story of Samba Foods

By Leticia Osafo-Addo, CEO, Samba Foods

African entrepreneurs have incredible potential to make African agriculture a dynamic, growth-generating sector that fills a growing market niche and engages the youth. However, small- to medium-scale food producers and processors face enormous challenges in building successful businesses, including access to finance, restrictive policy and legal environments, and a lack of technical and business skills. My work to build my company, Samba Foods, from a micro initiative to a successful, medium-scale company that supplies goods to the global market provides insight into the obstacles African agricultural entrepreneurs face, as well as our incredible potential...

Leticia Osafo-Addo, CEO of Samba Foods and recipient of numerous awards for entrepreneurship, shared her incredible story with attendees of the Partnership's 2012 US-Africa Forum in Washington, DC.

Starting Out

After returning to my home country of Ghana from Germany, where I had trained as a nurse-anaesthetist and intensive therapist, I set up an out-patient clinic in the village of Dawhenya and began to cultivate peppers on the side. As I considered how to add value to the produce I raised, I had a wonderful idea. Shito, a traditional pepper sauce that is a central part of the diet in Ghana’s coastal regions in Ghana, had become very popular among students in boarding institutions. Yet there was no ready-made shito on Ghanaian market shelves. This was the market niche that I identified and set out to capture.

Samba Foods, a food processing company based in Ghana, was the first to commercially produce and sell packaged shito pepper sauces.

I first tested the market by supplying a small number of processed shito products to markets in Accra. As my company was the first to produce, package, and distribute shito in commercial quantities, the sales were overwhelming. A new enterprise was born and christened Samba. Samba grew rapidly, and our shito products were soon found in department stores throughout Ghana. Samba shito accompanied the Ghana Armed Forces troops on peace-keeping operations around the world, and small quantities were exported to the U.S. and Europe. However, unexpected cash-flow problems drew operations to a sudden halt, as bankers who had nurtured and supported us through the period of rapid growth withdrew their support and dropped Samba like a hot potato.

Samba Foods' early-stage production facilities were very basic, but demand for the products proved to be high.

Overcoming the Odds

After a brief shutdown, Samba obtained a loan of under 500 USD that revived the business almost immediately. We diversified into other products, including peanut butter, fresh fruit juices, and fruit preserves. The business thrived and began to attract attention. However, a failed joint venture with a foreign company left Samba once again in the gutter with a mountain of debt. Having learned from our past experiences, we restructured, appointed a new Board of Directors, and developed a strategic business plan. Despite this, traditional financial institutions continued to balk at the idea of backing Samba. Several years later, venture capital funds allowed us to pay off some of our debts, purchase new machines, and improve our safety and quality standards.

Samba's luck turned when YUM Brands offered them a business deal. These ketchup sachets are produced for K.F.C.

Our luck turned when YUM Brands approached Samba about producing and packaging pepper sauce for its K.F.C. restaurants. We now supply sauces in sachets to several local fast food chains and are looking to expand to others. Business is booming.

Having achieved this success, it is clear that banks and other traditional finance institutions underestimated the resilience, tenacity, and determination of Samba. It is unfortunate that finance institutions, rather than assisting small enterprises in the identification of suitable solutions to their struggles, too often allow them to fold. SMEs in the agribusiness industry have the potential to lead Ghana’s development agenda through value addition to agricultural raw materials. With adequate support, Samba could become an indigenous agribusiness giant in Ghana and the sub-region—a household name that is recognized around the world and proudly associated with Ghana.

Samba's modern products are high quality, attractive, and well-suited for supermarket shelves in Ghana and abroad.

Looking Ahead

I do not see this as the end of Samba’s story. There are immense opportunities for the agribusiness industry to contribute to Ghana’s economic development if the sector is well organised and developed. Samba’s ultimate objective is to have a food processing emporium that fortifies staple foods and fights micro-nutrients deficiencies in the country and sub-region. The processing services we provide could dramatically reduce postharvest losses, create large numbers of jobs especially for young Ghanaians, increase smallholder incomes, improve food safety and nutrition, and contribute to Ghana’s GDP through export earnings and taxes. To achieve these ends, we need to modernize and commercialize smallholder farming, improve support and finance systems for SMEs (including non-traditional financing methods), create enabling policy and legal environments for SMEs and other private sector actors who will drive growth, and place more emphasis on entrepreneurial development and business training.

Africa’s challenges in feeding its increasingly urbanised population are large, but not insurmountable. Africa’s human and natural resources are more than sufficient to reduce hunger and poverty on the continent; we need only the services and support required to enable businesses like Samba to take root and succeed.