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Nigerian businesses have to be helped to take on Africa – MD, CSS Limited

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Wondering over which of Nigeria’s many businesses would go home with the trophy of the grand doyen of the Nigerian business space? Look no further: it is CSS Limited! Mr. Dare Oluwatuyi, incumbent MD/CEO at CSS Limited spoke to Business Hallmark about the feeling, the journey and the future even as the firm marks 150 years of doing business in the country. Excerpts:

At 150 years, CSS Limited may be the oldest surviving business organization in the country today, how does that make you feel?

Well, I will say I feel elated and I am happy to be part of the structure at 150. As you have rightly put it, we are likely to be the oldest standing business organization in the country. And I think this has been possible because of the owners of the business. It’s not a one-man business. Right from the beginning, it has had an organized structure. Yes the company has had its ups and downs but we have been able to survive up until this time. So I am very happy to be part of the structure and also very happy to be at the helm of affairs while the company is celebrating its 150th year anniversary.

It is striking that the business was started by the Church and the information we have is that the Church still forms its core investor base. Would that be correct?

Yes it is correct. To refresh our memory, the company was established by early missionaries. It predates the amalgamation and was established not exactly as a business venture per se but as a channel for bringing in resources for the establishment of schools and churches. Then it used to bring in not only Christian literature but also building materials: planks, iron roofs, nails, and related stuff. It was then known as CMS (Church Missionary Society) Bookshop. At a point, the company started selling some of those materials to indigenous Nigerians.
I remember some fifteen years ago when the veteran bookseller, Mr. Adefila of Adefila Bookshops told me stories about when he was patronizing CMS Bookshops. He said that they would come and buy planks, iron rods, roofing materials and nails from the company. The company was at this time chiefly engaged in the distribution of Bibles, Christian literature and books, and doing this, more or less free to pioneering schools and other users. After some time, when it was realized that the schools that it had set up were becoming stable and more solidly established and that its own churches were also becoming quite stable and strong, the owners of the company now took the decision to also begin selling some more of those materials that they were already engaged in distributing to other members of the public. But care was taken to ensure that they were traded, as a matter of principle and philosophy, at basically break-even prices. That’s how the company started evolving and at a time it had branches in literally all the then established major cities in Nigeria. You may be surprised if I tell you that CMS Bookshop had over 90 branches at a point!
It had now become a business and was then incorporated as a limited liability company. It was at this point also that the name was changed to Church and School Supplies, CSS Limited to cover the expanding scope of the business. We were now supplying schools with books and other resources even as we equally continued supplying the churches with their needed materials, more so when they are the owners of the business. At this time also, most of these materials were being indigenously produced. So we would make them ourselves and then distribute and sell.

And then for the churches themselves, when they want to produce their own materials, we equally did it for them. You know that we have our own press, the CSS Press, which is also about the oldest press in West Africa as it was established in 1913. Then we also started supplying other schools beyond even the schools that the CMS mission had established. This was in addition to their just coming to buy materials from us at our shops.
Part of our continuing success factor is that CSS is not a one-man business in structure. The Church’s interest as owners and prime drivers has also always been protected. Whatever we do, we take into consideration the fact that we are a Christian-based organization. Pricing must be reasonable and our operations Christ-like. And so when we go to some places, people may remark, ‘are you still around,’ and we will say yes. The fact is that being a slim-profiting organization, we did not have the cash to be loud even if we wanted to.

We have always endeavoured to ensure that our pricing is very reasonable and as such we primarily focus on breaking even, paying the salaries of our staff and paying dividends to shareholders. Our shareholders are about 90 per cent Church-based. They are the Church of Nigeria (Anglican Communion) and several of the dioceses that are also within the Church. In fact, for CSS Bookshops itself, about all of the shares are owned by the church.

But the Bookshop is not our only line of business as in addition to the Bookshops, we also have the CSS Press and Bookshop House Limited but it is CSS Bookshop that most people know.
Bookshop House Limited is the arm of the business that focuses on our properties and property investments. At the time we had over 90 branches spread all over the country and most of those properties were directly owned by the company.

Some of those buildings have now been relinquished to the dioceses. But some of them are still ours till date. And these are all over the country, in the North, in the east, in the west, in the South south, and they are administered by Bookshop House, including our 14-storey head office building. They all belong to, and are managed by Bookshop House.
On the flagship CSS Bookshop, we have a branch in Kaduna, one in Abuja, one in Port Harcourt and two in Lagos. In fact, we had two in Abuja but we recently merged them into one. But in the next one of two years, we want to start expanding again.

Do you have plans to go public anytime soon?

At a point in the past, we had considered it, but as you know in taking the decision to go public, there are also things you must put in place and so we would not do that until we have been able to meet those conditions. But I assure you that it is something that we have in mind.

Between your properties, printing and bookselling interests, which is your cash cow?

The three companies are treated independently though managed collectively using a unified management and board but at the end of the year they all answer their fathers’ names and each of them produces its own results.
I will say we are doing reasonably well overall but then the bookshop has more attention in terms of the requirements and I will say in terms of finance, it is also the father, or if you like, the mother of the group.
For one, the bookshop staff are more than those of the other two companies put together. Unfortunately however, our experience now is that books are no longer the essential commodity they used to be in Nigeria. Otherwise the Bookshop should be making more than five times, if not ten times, of what say the Bookshop House would make which is what we are yet hoping to achieve. So I will say that the bookshop is the cash cow today.
Again, what we have done to make the bookshop more viable is that we have introduced going to the universities, and servicing the libraries in the universities, polytechnics, colleges of education and then the ministries. We have introduced supplies and we bid for contracts as some other suppliers do. And it is in the course of such outreach sessions that people start asking, ‘so you are still around!’ And because we also have this long-standing brand goodwill, when we go out, people would make remarks like ‘CSS, O my father used to take me there.’ So we are well received. And as I said, we now bid for and execute contracts in addition to the retailing and bookselling that we do at our branch levels.
We go out, we attend exhibitions, both locally and internationally, so we gain more awareness and the traffic witnessed in our bookshops at the branch levels is now increasing. We also know that we have to increase our stock holding and improve on the image of the branches and are currently upgrading them.
I was in Abuja recently and in response to a few calls I made, people were remarking, ‘well done, we are seeing the things you are doing here.’ This is because we just gave our Abuja facility a facelift. In fact to put the transformation in context, I used to be the foundation manager at Abuja, but on getting there now, I almost could not believe my eyes. And this is notwithstanding the fact that I was quite aware of, and involved in the latest upgrading exercise in a supervisory capacity from base at the head office in Lagos.
When we finish Abuja, we will move to Port Harcourt. And to Kaduna. Apapa is also there. They are doing some road construction there now and we are watching things. As soon as they are done, we will also get over there to do what we have to do. That should give you an idea of the depth of transformation involved.
We are intent on doing this across our holdings and that would include even the work we have also begun to do here at Bookshop House in Lagos and some other things we want to do very soon. It will be massive.
I am particularly concerned about working on the bookshop. It is what people know and because of that it is important that we convey the best impression to them.

Going forward, if we don’t give the book the pride of place it should have, what is our guarantee for a viable nation?

Well, this is something we cannot run away from. Because whether we like it or not we just have to do it. You cannot give what you do not have. The level at which you can develop depends on the level of education that you have.

If you are not educated, you do not have information and are constrained in projecting your capacities, latent skills and talents. And this also applies to a nation. It is unfortunate that in our country today we are not giving the right attention to education. When we say education, it is not just about building and establishing primary and secondary schools and universities and polytechnics. The question we should ask ourselves is, are they properly equipped and funded? If you go to some of the schools or libraries that governments say they have established you will be sorry. I was in a certain state where the state government had established a massive building to house the state library complex. Yes there were shelves there but the shelves cannot carry books! They are just fanciful. If you put books on them, they will cave in.
They have done their work and commissioned it but books are not there! Pray, what is a library without books? The books that are there, some are fifty years old and virtually all are outdated!
Even in Lagos, it used to be quite bad. You had old books in the libraries and in fact they were dirty! I know that there have been a few schemes recently to improve on this but the situation is still bad overall.
We need to be reminded that the building does not make the school. It is ‘about the content.’ And because the content is not there, our pupils and students are also discouraged. ‘If I go to the library, what am I going to get?’ When we were growing up, we were happy to go to public libraries to read. Even when I was undertaking the mandatory National Youth Service, I used to go happily to the public library to read. Because then it was still meaningful.
But if you go to a state library now, what would you get? You will get books that are fifty years old and above and which are also unkempt. It doesn’t make sense. So as a company we set aside some days, like some of those days where books and education is celebrated, and we give information to schools around us to bring their students on trips to our bookshop, where we explain to them what bookselling is, take them round the different departments, the press, and explain to them how books are made: from the manuscript process to the final output as published texts. This we do so that they would better appreciate the books that they hold in their hands.
We also donate books to schools and libraries. The last one we did was in Abuja and in conjunction with one of the Rotary clubs in Abuja. Before then we had done one to IDP Camps in conjunction with the Nigerian Publishers Association, NPA.
Sometimes we also sponsor some educative programmes. Maybe very soon we may be able to set up a public library as a CSR initiative.

Your printing division is also another ancient landmark. I remember the epochal book, The History of the Yorubas which you inherited from the original UK publishers. But let’s talk about printing quality, why do some people have the impression that books printed out of Nigeria are more qualitative than those printed here?

Before I go there, let me add this. We have a publishing department under CSS Bookshops. Our Press now is no longer CSS Press. It is CSS-Sterling Printers Limited. We are aware of the evolving dynamics in the industry and it has encouraged us to be more current and relevant. This is what encouraged us to go into the partnership with Sterling of India and so we are now running the press together. We want new machines, we want current technologies, so that when we bring out the products, they will compete favourably with any other comparable products from any other part of the world.
So our publishing department is producing books, year in and year out for the primary, secondary and tertiary school levels. We also produce biographies, professional titles, annual reports, calendars, diaries and the likes.

But back to your question about the distinctions between a product from, say the UK and a product from Nigeria. I will say what makes a product really is the content. But in Nigeria, we know that we have research issues. And that is why we continue to canvass that our governments should provide the enabling environment to our researchers. The professors, the PHDs, everyone that is interested, so they will do better and we would have better content and output. So it is first a content issue.
To underscore this, some of our Nigerian authors are publishing outside the country and the content comes back better in such instances. Even when the researched package they send out is not originally up to the desired standard, they would be told and helped to make it better and in the end the content comes back better.

As a company, we are well aware of the deficiencies in our research environment so our publishing company is well equipped with seasoned and experienced staff that knows what to do. So when you bring your manuscript, we ask questions, the manuscript is assessed and then we let you know where it is not up to date if it is not up to date. And if you agree, we assist you in ensuring that we fix the issues because if it is not good enough, the market share you are targeting, you may not achieve it.

We assist our authors then to ensure that what they are coming out with is up to standard and therefore can compete with any others from any part of the world.

Now on the issue of the physical quality of the printed book, in the UK for example, they have the technology, the machines and their production is good but then some of their books are also not produced in the UK. You also have some of our publishers going elsewhere: to Singapore, to India to produce.
But then some of our local presses are also upgrading and in fact when you see some of their output, you really cannot say that this is not comparable with those from the UK, from India, etc. So they are upgrading. At our end, we are also working to achieve these better results too. And I will say that in the next five to ten years, I do not see why any publisher or author would want to take his materials for printing outside our shores.

Should this still be done, the major reason then would be the fear of piracy with the argument that if they produce locally, it may be easier for pirates to gain access to their material or that printers could collude with pirates to copy their materials. But what I have seen is that even when pirates copy, the outcome is still not the same. What however would also help is whether our governments will help by strengthening the laws that punish acts of piracy. This is because, if today, a pirate is caught and he is convicted and told to go and pay a fine of say 5000.00 or even if it is even up to one million naira, it does not deter him. Imagine someone that has made a hundred million naira and you are telling him to pay a fine of one million naira; it is nothing to him! But if more stringent laws are put in place, then that would help in taming the scourge.

Generally speaking, I will not say that we are doing badly in the arena of book production at the moment, both in content and in quality. The only snag however is that we are not doing enough in terms of content development, and notably in the areas of tertiary and professional books publishing. We have very few titles here because there are few authors writing on these. And you would not blame them because they really don’t have the time, the atmosphere and the infrastructure, that is conducive to, and stimulates and encourages writing. So they are not encouraged to do so.

We attended a programme in Ibadan a few weeks ago organized by the Tertiary Education Fund, Tetfund and part of the revelation was that in one particular field, Geography, they had nil titles! And we have PhDs and Professors in Geography! But are they motivated to take time out to write the good and well-researched books that the field requires?

But you see, if publishers are well equipped and they are having value for their efforts, they can sponsor authors that produce titles. You know for authors to write, they need to dedicate time. But even if they succeed in dedicating time to writing, what are they going to eat while they are doing that? So they need publishers who can sponsor them. But for publishers that are struggling, that is a tall order. You publish a book or say five to ten books this year and within five years, all the books have been pirated! So you no longer have the resources to do what you want to do as you now have to almost annually review the books, change the cover and print fresh copies again and again, just to beat piracy. Ordinarily, a book review should not be done in less than five years time but now we are compelled to change formats almost every year or once in two years just to beat piracy. It is unnecessary expense. This eats into publishers’ profits, time, etc and raises overheads unnecessarily. So these are the issues but then like I said, generally, I think we are not doing badly.

Beyond managing your own offices, you are also into property investments. Your property division, how is this unit faring?
Yes we have a project we handled in Port Harcourt, an estate project. And we are still running it. So we are also doing well there.

Are you still thinking of other investments in property?

Yes we are. Sure, we are thinking in that direction.

What is the estimated size of your business. The public would want to know?

I do not know what the public would want to know. We are not talking about Dangote, UAC, etc. But anyway, in our industry, we are doing reasonably well. Our company’s valuation at the moment would be in the range of 15-20 billion naira in terms of assets and properties and we also have plans to expand. Some of our properties for instance, may have over-spent their beauty so we want to upgrade and upscale. This would involve redevelopments at different levels, with some being adjusted say from one to two stories and things like that. So in the next few years, the hope is that we should even have a much bigger company.

Are you contemplating CSS Ghana? CSS Cote d’Ivoire and the likes?

Really, that is something that we should have achieved even ten years ago. But then you know that when your base is not even strong enough, you can’t be thinking of going into another country. We are already doing businesses with a few companies across our borders and the idea of opening shop in some of our neighbouring countries is something that I believe we will have to go into eventually. Like I said we are already doing business at some levels. We are exchanging materials, so with time I believe we will get there. You know the company is big. One of our titles for example, The History of the Yorubas is already being sold internationally by African Book Collective, ABC, so continental expansion is something that we will definitely consider and most possibly execute.

The timeline for the coming into force of the African Continental Free Trade Agreement, AfCFTA is just around the corner. Do you see more Nigerian companies keying into the broader field of pan-African business?

I think the opportunities are there. If you go to Ghana for example, almost all of our banks are there: GTBank, FirstBank; they are there. And in the UK, our banks are there: UBA, FirstBank, and GTBank. So the opportunities are there and we have to tap into them. But then, our governments also have to appreciate that such forays also involve a lot of capital outlay, and particularly at the beginning phases. So government has to help with ways of cushioning these expansion continental initiatives through the introduction of incentives like tax holidays. I was reading a piece and they were saying Amazon did not pay tax last year and would also not be paying taxes this year. And at the same time, they declared about 100m dollars in profits! The country must have looked at some things that the company has contributed to the economy and they are appreciating it!
But in our own situation, what do you find? If I tell you how much tax they slam on us? For example I have explained our pricing and profit model. But our tax people will come and say that our cost of production is over-estimated because they expect that if say I made a profit of N200million then my profit should be N50million. But that is not how my business model works. If I do business of 200million, I am only likely to make a profit of say 20million. I deal in books and because books are no longer really ‘essential commodities’ at the moment, there is a limit to how I can raise my prices. I want to sell the books. I want people to be able to afford it. I want them to have access to it. So I cannot just put any prices on them. But they would say, no, you must have made 50million naira. Are they the ones to determine my cost of production? And they would now ask me to go and pay something extra. Our governments, our tax people, have to look at the specific structures of businesses. What is the operating environment like? What model is practicable? Do not equate a bookseller with a gas seller, crude oil seller or a bank. No, it is a different environment and if they do that we will be able to operate better and expand.
You know when I go to the UK and I see bookshops, I am happy. And I say these are the kinds of things I want to see in my country. If this our 14-storey building for example, from ground floor to the top floor is a bookshop, it will be good for the country! If you go abroad, in a standard bookshop, you are likely to have a restaurant, a café, a reading corner, you would see different things. You would enter and not even want to come out. It’s like taking a vacation! So government needs to encourage our type of business and that would be good for the country.

How are you coping on the e-books front?

When you talk of e-books to people, some will say in the next two to three years there would be no physical books. That cannot happen anytime soon. In fact in the UK and in the US, you still see physical bookshops, well-stocked and people are going there. And then, that is also where many of the e-books are also coming from. That is where they originate from.
And in our environment, books will still be around for a long time. I am not even sure that they would ever go away here.
However, as a company, we are moving with time. We are also selling e-books. We have a number of data resources we are selling. And some of our publishers are involved. We have arrangements with some of them and are also selling their e-resources from primary through secondary and tertiary and on to professional books. We have e-resources for them.

What is your estimated staff strength at the moment?

Putting the three companies together, we will be about 165.

The Nigerian International Bookfair, NIBF is here again. What do stakeholders and the bookfair industry need to do to push the book game?

The first thing to note is that the book industry is still very competitive. This is despite the fact that we know that books are no longer being considered as ‘essential commodities’ by many Nigerians but then it is still a very tough environment out there and so I will give kudos to many of the people in the industry. You know it involves a lot of passion and one of us, Otunba Olayinka Lawal-Solarin and the Literamad/Lantern Books Group is celebrating fifty years of being involved in the industry. I listened to part of his press conference and you can tell that it is the passion that made him start and has kept him going till today,
Someone else would have said let me close this up and go on to something else, but then he has the passion. And the same goes for CSS Bookshops. Because the owners of the company had the passion and said we want to provide information, even when we are also involved in propagating the gospel. So what you hear is CSS Bookshop. You do not hear about CSS Property, and what we have said and decided as a company is that we must keep that image of being a bookshop company and so we continue to build on it. So what we can do and which we are doing is to ensure that our products are affordable. This is also in appreciation of the fact that the financial wherewithal that is available to perhaps 80 percent of our population is also presently limited. Our understanding is that people want to read but then when they look at what they have and appreciate the other needs of feeding, shelter, clothing, transportation, the reality then is how much is left with which they can buy books and reading materials? So what you budget for books is limited and when you come over and what you have cannot give you the book you desire, you may be discouraged. So we tend to watch our pricing in a way that somewhat fits into what you will call in other situations CSR. Our pricing should be right so that the books can be affordable and then people can be encouraged. And also they have to be available at the right place and at the right time.
Part of this is the exhibitions we do at bookfairs because some of the people that come there do not go to bookshops. They come as some kind of sight-seeing, some tourist activity. But when they come and see the range of titles on display then for some of them, their perception may change and then they could pick up the fliers and subsequently call or come over to the bookshop. So our products must be good, our pricing must be right and we must make the products available to the populace at the right place, the right quantity and at the right time.