Doing business in Somalia - Anyone with experience

[BestCaseScenario]

I’m originally from Kismaayo and have many family members still living there.

You don’t need anyone to vouche for you when you do business in Somalia. The deeper your pockets the easier it becomes to create partnerships with other entrepreneurs.

I have many non Puntlander connections in Somalia and many people are looking to connect with other gobolists because it’s a win-win for both parties especially when you can welcome the other person into your Gobol.

If your capital is limited then it’s easier to start in your Gobol because it reduces risk since Somalia has no insurance or contract litigation to protect businesses.

If you’re interested in sesame, the crop can grow anywhere in Somalia, since it’s a drought resistant crop.

Pick a niche you like and find other gobolists who share the same passion as you. Going to Somalia alone is a major shit show, you need investors to help midigate risk and help you operate the business when you build a operations system that can work on its own.

Here is a volunteer and a solid guy. Good character on here. Michael Blackson, Here is your Guy saxib. Haka fuqin camal.

 

[Deactivated]

@Haji @BestCaseScenario

Good to know that clan thing won't be too big of an issue in the big cities but you still need some locals vouching for you. I guess things have to move a little slower than expected and I might start with going just familiarize with local actors.

Any commetns on general trustworthiness? I guess you can't contract out certain operations as easily as in say Sweden

Everything in Somalia is based on a solid operational system to limit risk. You literally need mountains of paperwork and standard operating procedures SOP, E.g, from Safety to financial systems to teach your team on the ground run the system.

The most crucial procedure in Somalia is whether you can install Audit controls into you business. Somalia needs Audit Soldiers and Audit culture.

There is no insurance or contract litigation in Somalia. So you need to build an SOP and have controls in place to limit fraud and other operational risk from doing business in Somalia.

 

[sgfrmtheblock]

As people have said, your qabil connections can be more helpful in a small town or village. In larger cities like xamar o hargeysa it doesnt have that much influence tbh.

Also it isn't a good idea to put a lot of weight to on your qabil connections to help you out since they will also expect something in return as soon as you start making money. I would suggest to first try to make your own connections. There are loads of other young diaspora guys involved in business in every city.

Don't make the mistake to employ family just on the merit of a blood connection. In my experience, they are of the belief that they deserve the job and cant do a thing wrong.
Just try and find someone who is known around the area and looks trustworthy.

 

[Michael Blackson]

I’m originally from Kismaayo and have many family members still living there.

You don’t need anyone to vouche for you when you do business in Somalia. The deeper your pockets the easier it becomes to create partnerships with other entrepreneurs.

I have many non Puntlander connections in Somalia and many people are looking to connect with other gobolists because it’s a win-win for both parties especially when you can welcome the other person into your Gobol.

If your capital is limited then it’s easier to start in your Gobol because it reduces risk since Somalia has no insurance or contract litigation to protect businesses.

If you’re interested in sesame, the crop can grow anywhere in Somalia, since it’s a drought resistant crop.

Pick a niche you like and find other gobolists who share the same passion as you. Going to Somalia alone is a major shit show, you need investors to help midigate risk and help you operate the business when you build a operations system that can work on its own.

I see. I'm in need of networking so if you have some connection down there I would love it if you could connect us. I'd love to pick your brain on this in general too if you have any experience in exporting commodities from Africa and clearing the import in a European country.

I'm uncertain on how much of the operations I have to do myself or how much I should outsource. There are companies that do all of it for you but it'll eat your margins and theycan eventually connect with your end buyer themself..

 

[Deactivated]

I see. I'm in need of networking so if you have some connection down there I would love it if you could connect us. I'd love to pick your brain on this in general too if you have any experience in exporting commodities from Africa and clearing the import in a European country.

Start a website or vlog based on your niche.

We have way too many neefs and you’d be surprised to learn how many Somalis outside and inside of Somalia don’t care for the country or the opportunities.

Bring the network to you. If you’re interested in farming, go to Somalia and film yourself growing something and sharing the information with that niche.

I started a channel and took a break because I realized it requires my full attention for a very long period of time. It’s the only reason I stopped so I can go compeletly fullsteam when I have all the ducks in a row.

Fear is the currency in Somalia and Creativity is killed by Cabsi. Everything you described was covered by Cabsi.

You don’t need anyone to vouche for you. Just buy the land and find people willing to join your board of directors.

 

[BestCaseScenario]

As people have said, your qabil connections can be more helpful in a small town or village. In larger cities like xamar o hargeysa it doesnt have that much influence tbh.

Also it isn't a good idea to put a lot of weight to on your qabil connections to help you out since they will also expect something in return as soon as you start making money. I would suggest to first try to make your own connections. There are loads of other young diaspora guys involved in business in every city.

Don't make the mistake to employ family just on the merit of a blood connection. In my experience, they are of the belief that they deserve the job and cant do a thing wrong.
Just try and find someone who is known around the area and looks trustworthy.

Tolka waa ka baxday already




Guys like you are the best. Merit based system is coming to our country Inshallah. It is an uphill battle but we need to wage that war.

 

[Deactivated]

@Michael Blackson

It’s difficult to export perishable commodities out of Somalia. Most people ship out of Somalia and bring them into Kenya and re-stamp them as a Kenyan export after cleaning and sorting the crops.

Kenya has many containers with climate control systems inside them designed for Agro. In Somalia, most of the containers don’t have moisture regulation that meets international standards.

Another way is to export to Dubai, rent a facility and clean your products and re-direct them back to Europe.

 

[Michael Blackson]

@Michael Blackson

It’s difficult to export perishable commodities out of Somalia. Most people ship out of Somalia and bring them into Kenya and re-stamp them as a Kenyan export after cleaning and sorting the crops.

Kenya has many containers with climate control systems inside them designed for Agro. In Somalia, most of the containers don’t have moisture regulation that meets international standards.

Another way is to export to Dubai, rent a facility and clean your products and re-direct them back to Europe.

Yeah, this is one of the main reasons I going for sesame since seeds are less cumbersome than fruits and veggies when it comes to storage and transport. I've had phone contact with a Mog based facility for sorting, packing and QC and there's also the option of Egypt when it comes to processing.

I'll look into Kenya and Dubai...

 

[Deactivated]

Yeah, this is one of the main reasons I going for sesame since seeds are less cumbersome than fruits and veggies when it comes to storage and transport. I've had phone contact with a Mog based facility for sorting, packing and QC and there's also the option of Egypt when it comes to processing.

I'll look into Kenya and Dubai...

Beware of Somali Alibaba manufactures. I emailed a guy once and it took him 1 month to reply. He sent me a sample of the seeds and they looked like shit. The seeds arrived in Malaysia because Canada would have rejected them.

Somali sesame is a longways away from being produced efficiently. The energy costs alone make it unprofitable when you sort them in Somalia.

There’s a few good suppliers with clean sesame, but the thier consistency is questionable. It’s all due to power outages, limited equipment and poor management.

The Ciyaal Kacaan Odays are a disaster when it comes to efficiency.

 

[Abkaal]

I'll start off by saying who i am. I'm a guy in his late 20s who's grown up in Scandinavia. I haven't been to Somalia since we left at the age of two. My Somali is fluent.

I'm planning on starting some sort of export business in Somalia, this is not about the business itself so let's assume I have a good idea and enough capital. The question is regarding the ease of making business in Somalia.

• How much do you need clansmen/family vouching for you?
  
  
• Would being in an area where your clan is a minority be a problem?
  
  
• How much do you have to pay in bribes and other 'unofficial' costs?
  
  
• Can you employ a random dude and expect them to not rip you off?
  
  
• What's the general sense of contract compliance between businesses?

I am actually living here in Muqdisho

1) Do not expect your clansmen to vouch for you until you're successfull your family may vouch for you and when you become successful they'll indeed come to you and you gotta be ready for that lol.

2) Do not open a business where your clan is majority (see Suuq-Bacaad majority of the people there are Abgaal and compare it to Bakaara Market where you'll find every Somali speaking person hencewhy Suuqa bakaaraha is successful)! If you're planning on opening a business in let's say Hargeisa you just open it and make the directors Isaaq but you control it (see Telsom most of the share is owned by the Hormuud guy) and also don't make the SomTel mistake where ever you go make the directors the local guys and not your own Qabiil.

3) bribes are pretty common although it depends on the size of your company.

 

[Michael Blackson]

Beware of Somali Alibaba manufactures. I emailed a guy once and it took him 1 month to reply. He sent me a sample of the seeds and they looked like shit. The seeds arrived in Malaysia because Canada would have rejected them.

Somali sesame is a longways away from being produced efficiently. The energy costs alone make it unprofitable when you sort them in Somalia.

There’s a few good suppliers with clean sesame, but the thier consistency is questionable. It’s all due to power outages, limited equipment and poor management.

The Ciyaal Kacaan Odays are a disaster when it comes to efficiency.

So you seem to have explored this route yourself....
The reason I want them sorted in Somalia is to not have an overly complex supply chain/operations situation. Ideally, I would buy from a local processor (e.g they guy I talked to) and get them delivered to the port and get paid FOB by buyer.
My main focus would be to get all the possible quality docs for the product, branding and marketing.

You mentioned the quality of Somali sesame being not so good and the processing cost being high. Is it even possible to compete with the Indians for a small actor from Somalia?

 

[Deactivated]

So you seem to have explored this route yourself....
The reason I want them sorted in Somalia is to not have an overly complex supply chain/operations situation. Ideally, I would buy from a local processor (e.g they guy I talked to) and get them delivered to the port and get paid FOB by buyer.
My main focus would be to get all the possible quality docs for the product, branding and marketing.

You mentioned the quality of Somali sesame being not so good and the processing cost being high. Is it even possible to compete with the Indians for a small actor from Somalia?

Somali sesame is cheaper and lower quality then India’s. Many Indians in Africa export to India and re-stamp thier products as “Indian Made”. There’s nothing wrong with it and it’s legal.

When I did my research on the sesame in Somalia, the two main issues were quality and consistency.

The Ciyaal Kacaan are complete degenerates when it comes to professionalism. They don’t reply to emails, they don’t care for thier customers and the client experience compeletly sucks.

The business culture in Somalia needs to be overhauled along with the daqan xuman.

A good start for you is to open a website first and see what kind of interest you get from your SEO ranking.

I did this with a few other niches and had inquires from around the world, there’s an interest in Somalia when it comes to Agro, but the Agro community is still suffering from the production inefficiency that dates back to Somalitas banana exporting; where Somali bananas costed 3x more to produce then the Caribbean competitors. It was so bad that the Italian had to subsidize the import as a luxury good and the Italian government paid the higher price to maintain political ties with Somalia.

This type of shit doesn’t fly in todays globalization.