When Felix Chege first dipped his toes into the world of public supplies as a university student, he did not have the benefit of full visibility of how bureaucracies and information gaps inhibit business.
All he could see were the challenges whenever he wanted to, say, source 100 printers of the same quality from Nairobi for supply to Masinde Muliro University, and ensure consistency of supply to meet the university’s demand.
“Imagine being asked to deliver 100 printers when you have no idea where to even source them consistently. Nairobi had them, yes, but getting them from different suppliers and same quality was a challenge,” Mr Chege recalls.
It was this sourcing headache that planted the seed and Mr Chege began to dream of a platform that could simplify procurement, sourcing, and logistics.
He started Real Sources Africa, a company that has carved a niche out of breaking the red tape involved in cross-border trade by digitising operations that have always relied on paper to facilitate cross-border movement of goods, while connecting traders with business facilitators.
Today, Real Sources Africa is the official trading company of the African Continental Free Trade Area (AfCFTA) in Kenya and eight other countries.
At a time when most African countries are looking inward to trade with counterparts as a way to grow business, Real Sources Africa finds itself as a crucial nexus between businesses and markets, and while at it cultivating influence and cash.
“We are basically a trade facilitation company and our main role is to support exporters and importers to be able to expand their market base across the region without the hassle of the normal logistics, market entry and capacity building,” Mr Chege says.
The company has facilitated trade valued about Sh5.8 billion ($45 million), involving 315 containers since launching its platform nine months ago, and business will only get bigger after the African Export-Import (Afrexim) Bank came on board as a partner.
Real Sources Africa is currently getting support from the AfCFTA to facilitate onboarding and trading among businesses in the continent, but also from the Afrexim Bank which has offered its platform, Africa Trade Gateway (ATG), for use by businesses trading under the AfCFTA.
Since the launch of ATG on September 23, 400 new companies have registered and Mr Chege says the company expects to onboard 3,600 businesses in the next six months.
With the entry of Afrexim, financiers and businesses in need of cash flows are expected to come on board due to the development bank’s capacity to bank roll trade transactions.
Companies pay Real Resources a commission for their profiles to be maintained on its platform, where they can meet buyers if they are selling products, or source for products not available within their locality, if they are seeking to import.
Real Sources finds itself as the trusted bridge for businesses across the continent, and benefitting from the ATG, a key trading platform that is capable of conducting due diligence on companies seeking to trade through the AfCFTA, thus boosting trust among trading parties.
There are only 10 AfCFTA trading companies across the continent, and Real Sources is the official face of the continental trade bloc across nine countries.
The companies are charged with representing AfCFTA in market development and demand creation as the trading bloc entrenches its operations, essentially by identifying where there is a need for certain products and supporting ways to supply them from within the continent.
They also support businesses attain compliance requirements, aggregation and logistics issues to build volumes for export across borders, and facilitate trade finance for businesses in need of financing to trade successfully.
“AfCFTA trading companies came up to create a practical implementation of the AfCFTA ratification. They are lifting up the barriers of trade such as customs and standards issues, and tariffs to make trade very practical,” says Mr Chege.
What started as a small campus hustle in 2015 has evolved into a regional enterprise that is now simplifying trade for exporters and importers, and while at it cultivating influence.
The company approached AfCFTA secretariat to pitch its idea on how digitising operations could address major trade barriers within the continent, and that was how it was picked to be the trading bloc’s official face to the business community.
Among products it showcased was a platform dubbed Biashara Link Portal which is capable of directing business inquiries by potential buyers to the right producers of goods being sought for exporters to initiate conversations.
This happens through the creation of a database of already active exporters of different goods, for them to receive inquiries directly and start negotiating with buyers.
“Why should someone fly across the continent just to find out what’s available? Technology allows us to make trade borderless, at least in terms of information,” says Mr Chege.
The company also signed a partnership agreement with Kenya's Ministry of Foreign Affairs to automatically channel business inquiries coming through embassies to producers of the goods being sought.
Through an initiative dubbed TradeConnect, Real Sources is also engaging with stakeholders including counties to create demand for goods produced locally, by leveraging the County Aggregation and Industrial Parks (CAIPs) to produce and ship in volumes.
“We removed our minimum turnover requirement. Initially, we required companies to have at least $100,000 turnover but we realised that that was locking out too many passionate entrepreneurs. Now, we’re fully in the SME space,” says Mr Chege.
To onboard and trade on the platform, a company needs to provide its certificate of incorporation, business details, ownership structures, and undergo due diligence by Real Sources.
Mr Chege believes that while logistics in terms of physical infrastructure has hindered intra-Africa trade, information gaps, where many lack visibility on what product is needed, were leading to mismatched demand and supply have also been a huge barrier, a problem Real Sources seeks to address.
“Our role is to map demand and supply, then guide businesses accordingly. If maize is needed in Rwanda, or steel in Egypt, we should know—and help businesses position themselves to seize that opportunity,” he says.
And as AfCFTA gains momentum in an effort to charm Africa more towards trading with herself, the role of its trading companies such as Real Sources Africa will become more crucial, as they stand at the heart of the trading bloc’s operations, connecting governments, banks, and businesses.
