In a tribute, Stephen Sembuya offers a chilling account of his father’s humble start to grow a trail-blazing business empire.
How did Sembule manage to come out of nowhere to become a top brand in East Africa?
There are many explanations for the company’s phenomenal growth but one technique was thinking big, yet take small steps. No matter how ambitious the plan, you have to roll up your sleeves and start somewhere. People thought my dad was crazy when he resigned as senior finance officer in the ministry of Finance in favour of untested waters.
MAN WITH A SOUL OF STEEL
Sembule Steel Mills started as a small hardware shop in Ndeeba, Lubaga in 1961. The shop had earlier been owned by his mother who let him put his franchise that included, cement, hoes and nails purchased from Indians that has been making them from Industrial Area.
In 1969, the young Christopher Sembuya asked his brother Wilberforce Buwule to join him and the two kicked off what would become a successful and enviable brand for three decades in the region.
The first registered business name was Ndeeba Hardware. In 1971, they created Sembule Industries, carved out of their surnames Sembuya and Buwule. Later, they formed Sembule Steel Mills in 1974.
They bought a small piece of land measuring about half an acre for their residential but quickly turned it into a nail-making factory. They started with one nail machine that they nicknamed ‘Nalongo’ because it helped them earn a lot of money thus becoming a fully-fledged steel business.
In 1974, Sembule Steel Mills went on to be the first company in Uganda to manufacture steel products like chain links, barbed wire, metal lathe and welding electrodes, among others. At the time, Sembule enjoyed more than 80 per cent of the market share.
FOCUS
For a low-profile Ugandan man from Kikwayi with no university education to dream of setting up a steel plant in the 1970s in an uncertain economy required audacity of a very high order. But Sembuya was nothing if not audacity.
Even so, so sceptical of Ugandan manufacturing capacity many Ugandans saw it as a crazy move. He even bet with his dad that he would eventually do better than him. History today has record that these Ugandans digested their words that they compelled to eat but it’s a good thing Sembuya didn’t let such blustery talk faze him.
Acquisition is one of the three major routes for business expansion, the other being organic growth and strategic alliances but all these can only be achieved with teamwork and proper planning.
The initial capital invested was from his savings from his salaries as a district commissioner in Karamoja and later as a finance officer in the ministry of Finance. They did raise a lot of money from trading activities from their hardware, Uganda Development Corporation, then more assistance from Mohan Kiwanuka, Kasujjja and Moses Kibirige of Uganda Development Bank, UCB, Barclays bank and Bank of Uganda played a big part in their expansion.
They first applied for a loan from UDC in November, 1969 to purchase two nail-making machines that was granted only in 1970, it was Shs 120,000. In February, 1973, UDB offered them another Shs 620,000 at an interest rate of nine per cent per annum.
Other early notable financing for expansion was in 1977 when they applied for Shs 5m but got only Shs 2m extended in September 1978 for completion of building at 12 per cent per annum. In a bid to expand, the brothers bought land in Nalukolongo. They also compensated the sitting tenants.
Sembule applied for a lease in May 1977 from the ministry of Lands and paid Shs 58,430 as premium and was offered six hectares in June, 1977. They had earlier on July, 1967 applied for Wire Nail manufacturing plant temporary permission to
Mengo Municipality Council following approval from the ministry of Commerce and Industries in the same year. Before implementing, there had to be proper planning for the huge expansion. Many meetings took place. In 1976, they also had to visit factories in Nairobi and Mombasa for five days.
VISIONARIES
In July, 1989, the brothers and their executive that included Steven Musoke, Emmanuel Katongole and David Serebe gathered for a meeting where a crucial decision to enter the electronics business was made. Sembule electronics was registered in 1990Â and in mid the same year started operation establishing its own production and accumulated technology, it pushed to produce
and assemble telephone exchange, coloured TVs, antennas, portable radios, cassette radio and video decks.
The first time color came to the TV screen for Ugandans to see, it seemed the whole world had changed as everyone wanted to have a piece of it. In addition, the TV remote seemed incredibly preposterous to Ugandans as family viewing was seen in a whole new light.
Then there was Sembule’s Makula radio sets, a popular set that helped transform and popularise the new FM platform in 1992.
Sembule also introduced street lighting in Kampala, this helped curb rates of accidents at night and crime. They also set up the first bulb plant and after extensive investment and expansion of production lines, they were now the region’s largest consumer electronics company.
TRENDSETTER
Sembule’s Cablesat International Television or CTV started broadcasting in December 1992, becoming the first private broadcasting station to be allowed by government to go on air. It was received with great enthusiasm and went into agreement with CNN to downlink CNN’s signal and rebroadcast it locally. This was all possible because of a great team lead by Gordon Sentiba. In 1998, CTV merged with WBS.
MENTORSHIP
It is widely known that building up a good team is critical to start up success, and hiring the right people can be tough especially when financing is limited. Rather than seeing workers as assets to be nurtured, developed, manufacturing companies and businesses have often viewed them as objects to be manipulated or as burdens to be borne.
Thankfully, Sembule had an eye for scouting and working with the best in the industry. Their executives and team members were trained often in technical schools in and out of the country which gave them great exposure and motivation. These were stars and played a vital role.
Some of the very notable ones include; Apollo Makubuya: He was Sembule bank’s company secretary. John Ken Lukyamuzi: The former MP grew up at the Sembule premises and his first job was a night watchman at the factory. He was recruited in November, 1980.
Owek Mulwanyamuli Semwogerere: Years before he was called to serve as the Katikkiro of Buganda, he played a vital role as the managing director of Sembule Investment Bank.
Gordon Sentiba: The insurance guru led the group’s Insurance company to become number one at the time in Uganda. He even saw it go into the Tanzanian market.
Steven Musoke: He was one of the founding members of Sembule having been recruited from Golf course in the early 80s. He played a vital role in all the group’s companies and today he is the chairman of Multichoice Uganda.
Deo Kayemba: He played the role of executive manager at Sembule Shelter. Later he was made director at Sem- bule’s Pan World Insurance Company (PWICO), a similar role he held at CTV as a director.
Emmanuel Katongole: He was recruited straight from university and was the executive director of the electronics section.
James Kakooza: The former MP worked with the group’s bank for some time.
Leo Kibirango: The former Bank of Uganda governor worked with the group’s bank and insurance company. Justice Godfrey Kiryabwire: Played a vital role in the insurance company for a long time. Others include Geoffrey Kihuguru and Edmond Katiti, among others.
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