Interviews

Vimal Shah is the Co-Founder and Chairman of Bidco Africa, a leading FMCG manufacturer based in Kenya that operates across East Africa. Established in 1985, Bidco started as a family business led by Vimal, his brother Tarun, and their father B.D. Shah, whose initials gave the company its name. With manufacturing units across the region, Bidco currently owns over 50 brands in sectors including edible oils, hygiene, personal care, food, and beverages.

Shah begins the interview by reflecting on his upbringing in an entrepreneurial family, as his father, a first-generation Kenyan, launched several ventures including a garment manufacturing business which he started in 1970. While pursuing a bachelor’s degree in business administration at United States International University in Nairobi from 1977 to 1980, Shah explored the integration of cotton production with textile manufacturing in Kenya. His university projects focused on enhancing the family business's local value chain for cotton, from raw materials to finished products. Shah explains how his studies revealed a significant opportunity in the byproduct of cotton seeds, which could be processed into edible oils and soap. He analyzed the business models, contrasting the complex cash cycle of the garment industry with the simpler, more predictable cycle of oil and soap production.

After conducting feasibility studies, Shah saw the opportunity to start a business producing soap and cooking oil but needed credit to finance the family’s new oilseed venture. He explains how bankers liked his propositions but did not approve loans due to Shah’s lack of experience at the time. Furthermore, bankers explained how “Unilever could kill you,” which prompted Shah to think in depth about the challenges in competing against a multinational of Unilever’s size, and the competitive advantage Bidco would have as a local company. At this stage, he shares how he followed the advice given to his family by a representative of the International Finance Corporation (IFC), who suggested that they start small and build up the business through backward linkages to cover the full value chain.

Upon receiving advice from the IFC, Shah started with the end of the value chain in soap manufacturing, opening Bidco’s first small factory in 1985. He outlines the company’s initial strategies, sourcing palm oil from Malaysia in bulk tankers to create unique soap brands aimed to be superior in quality to existing blue detergent soaps, yet affordable for the lower-income market. To compete against established players such as Unilever, Shah focused on understanding local consumer needs, developing multiproduct brands at different price points, and leveraging the clothing distribution network of Bidco’s parent company to access markets where other soap brands dominated retail shelves.

Once Bidco had established a solid market presence and built strong distributor relationships for their soaps, Shah discusses how the company furthered its original goal to cover the entire value chain. This was achieved through strategic backward integration – from soaps to oils and oilseed crushing, and ultimately to agriculture. In 1991, Bidco opened a large edible oil manufacturing plant in Thika, a town near Kenya’s capital city, Nairobi. Shah highlights this as an important milestone for the company, marking it as the first in East Africa to undertake local edible oil refining and fractionation. Subsequently, Bidco acquired a popular brand named Elianto from Unga Ltd. in 1998, which allowed them to expand their operations into oilseed crushing and increase their market share. Since then, the company has expanded their processing capacity and developed relationships with local farmers, encouraging them to grow oilseed crops by offering guaranteed purchase contracts.

Shah underscores that an important benefit of covering the entire value chain is the reduction of wastage along production process lines. For instance, he explains how the byproducts from edible oil refining are used for soap production, or how agricultural waste and biomass are repurposed. He describes the pursuit of zero wastage not as a need to comply with ESG standards, but as a financially sensible route that follows the company’s own code of ethics. As he outlines, this approach ties into Shah’s views on Corporate Social Responsibility, which he describes as “cosmetic social responsibility.” Rather than focusing on demonstrating environmental or social action through the media, he relates a preference for providing income and employment opportunities for farmers and others along the value chain.

In 2012, Shah also turned his attention to politics as a representative of the private sector to help found Mkenya Daima – a non-partisan multi-stakeholder platform with the goal of promoting peaceful elections and socioeconomic prosperity in Kenya. Drawing from experience in negotiating collaborative advantages in business, Shah emphasizes ways he would seek common goals to overcome internal divisions and competitive mindsets. This allowed previously opposing groups to see themselves as part of the same in-group working towards a compelling national cause.

To conclude the interview, Shah relates his experience in industry selection, noting that Bidco focused on fast-moving consumer goods such as hygiene, personal care, food, and household products due to the inelastic demand for these essential items across Africa. He underscores the importance of listening to consumer needs on the ground and building out full value chains from agriculture to finished products. FMCG, as Shah explains, will continue to be a major industry in Africa given a fast-growing population. However, he sees hopeful space for digitization and fintech to unlock further growth, especially if the region’s young population is viewed through the lens of opportunity.

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