The Indomie Noodles Strategy

The Indomie Noodles Strategy

I confess that I have used Indomie noodles in all strategy sessions my firm has run in Nigerian companies. My wife Ifeoma likes the stuff but I am not sure I have ever tasted more than a spoon. But Indomie does not need me to be a consumer to be a fan of the strategy. Simply, one of the finest companies you need to study in Nigeria is Dufil Prima Foods (the makers of Indomie).

If you do what they are doing, you would find glory. I have papers on this business; it is a very delightful company. They understand Nigeria and they are delivering at the highest level. You want reality check? They consumed Dangote Noodles, doing to Dangote Group what it has done to many companies in Nigeria.  Yes, Dangote Group was outcompeted and it sold to Dufil!.

Business legends of Naija – the Indomie Noodles Strategy.

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!

 

 


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