By Ian Ortega
I met a fairly rich friend of mine and asked him a question that had puzzled me for a long time. “Why don’t most of you people invest in industries? Why are all of you doing real estate?”
His answer humbled me but also got me depressed.
“You see Ian, in Uganda it is always good to avoid businesses with many moving pieces. They will send you to your grave earlier than you expect.
Most businesses in Uganda fail because employees run them down.
Imagine I started a factory, do you know that most of the profits will go to my employees. Ugandans will steal something at every stage of the value chain.
As you source materials, someone will cut a deal. They will inflate the prices. Then another employee will be waiting to steal some of these materials. Then you have equipment to deal with. You have the finance people. You can’t trust them too. They can cook you up in numbers.
Now you will go to the Sales people. The logistics people will also be waiting to get something. Your truck driver will find a way to cheat up, either on fuel, or doing a trip to run their own errands. You will even have ghost employees.
Unless you want me to get heart attacks for no reason, I rather stick to the things I know with few moving pieces.
At least once I construct my apartments, I only have to deal with tenants. And I know very well how much I should expect to collect from my apartments at the end of the month.”
From then on, I realized this Ugandan system is a jungle. The Bodaboda man will claim not to have change so that you tell him; “okay keep it.”
Last time I was buying a phone in Lugogo, the lady intentionally kept the 10K off the change she gave me. I acted a fool for sometime, then walked back and asked her for my 10K. She acted surprised.
You go to buy something at a Ugandan supermarket, a fridge or an electronic, the employee will whisper; “I can get it for you at a less price. Let us meet in the parking.”
My aunt used to run a bar. She was impressed by her new manager. Everything was balancing just perfectly. She would do the stock take on time. But sales were declining. She soon realized this person was stocking their own alcohol. Imagine, someone using your utilities, your premises, and making money on a daily.
Although we complain about corruption in this country, we all seem to be active players to it. At the bottom level, there is nothing to prove that Ugandans genuinely hate corruption.
After that experience with my rich friend, I decided to go slow on our rich class. I now understand why they settle on the simple things. They don’t want to suffer with daily headaches. Ugandan employees will become entrepreneurs within your business. They will use your business to build their business. Someone else will use their own business to build a business.
In fact, another friend told me; “In Uganda, you have to allow for a margin of theft. You have to make peace with the theft as long as it is manageable. An average Ugandan is a thief that just lacks an opportunity.”
After all, even maids will be removing bars of soap from homes and giving them to the neighbors. If you try to buy things in bulk in Ugandan homes, you will end up losing. The maid will start selling off the sugar, the charcoal. Spoons and forks dramatically disappear in Ugandan homes.
We just need to auction our country!
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