I began the day with a client in Rwanda. He asked a question: how can I be as successful as mini-Aliko Dangote? My answer to the Board was simple […], and using Indomie Noodle as a case study, I explained how Dufil Prima Foods (owner of Indomie Noodle) knocked out Dangote Noodle out of competition and finally acquired the vanquished DG subsidiary for nothing. We have developed a framework on that in my practice [from the way we see it].
Business is a living system. Just like you feed babies for them to grow, based on frameworks mothers, nurses etc have mastered over generations, companies have attributes. You can see patterns in markets and build on the consistencies and similarities.
Now, feel great, you can take up Dangote Group or you can defend your territory by doing what Dangote Group does. Read it here.
In this videocast, I explain how the makers of Indomie noodles used the same strategy Dangote Group had deployed across industrial sectors to defeat Dangote Noodles. The accumulation of capability which Dangote Group uses to crush competitors did not work because Dufil Prima Foods (makers of Indomie) did the same thing from electricity generation to production, for its noodles business. With their vertically integrated business, there was no left efficiency which Dangote could exploit to improve quality and reduce price. At the end, an established brand won and Dangote Noodles could not dislodge them. Dangote Group later sold its noodle business to Dufil Prima Foods. This shows a practical model anyone that wants to compete against Dangote Group can deploy. Beware: you need to be very solid!
And Dangote confirmed my point here.