7 / 28 / 2009

This week FK and Leah are back in town, so the issue is once again the coaster hubs made in China that have been failing: back to my first hour in Lusaka. Also, since returning from Harare, this week has been hectic with the logistics of that endeavor and performing the financial analysis to support the investment. I’m right at home with a sharp pencil and Excel.

The week started with a drive to Brian’s farm. It’s an hour drive and I met him Saturday morning. True to form, I pulled out the laptop, straight to business and ready to discuss the figures for the project in Zimbabwe. Brian laughed at me, as so many do. First they shared a nice family breakfast with me. Brian’s two kids are very good-natured and Angela is a wonderful host; plying me with questions about my life and family. I was happy to tell her how much I was reminded of my family and home by the rural aspects of Africa. The breakfast was porridge made of corn meal and eggs. Corn meal is the largest staple of Zambia and this porridge is mainly a watered down version of nshima. Nshima is eaten by Zambians at nearly every meal. It has little if any nutritional substance and is usually accompanied by a relish. The relish can be a simple sauce to vegetables or meat. The meal is eaten by hand, rolling the corn meal into a sticky ball and dabbing it into the relish. But I’m off track…

After breakfast, before I can go back to the computer, Brian takes me outside and asks if I can ride. You bet your ass! We climb onto a couple dirt bikes and take a tour of his farm. The area we inspect is the pasture for his cattle. Brian has about 40 head that I could see and says it takes 8 acres to feed each (that’s for you Tunas). We stop by his mill where he inspects the processing for corn seed he’s selling and then take a look at the pivot that is watering the winter wheat. The winter wheat is the last thing Brian is waiting for before handing the farm over to another investor and moving back to Zimbabwe. The harvest will begin the end of September. It was a very nice morning, its always nice when someone reins me in to show me the better aspects of life. Afterwards we go over the numbers that I will be working each of the next few nights to prepare for FK.

Everyone who is involved in this project is excited about the prospects. From the lack of quality competition in bicycles, the opportunity to be on the ground floor of anything in Zimbabwe, to the size of the overall market (both the 500 million people of sub Saharan Africa and the resources of several NGOs, specifically World Vision). We have great confidence that the business will work, as long as we get the first few steps correct. And of course the price – which is my job.

On the way back to Lusaka I stop on the road to drink in the idea that I’m actually here in Africa, that this isn’t some dirt road back home

and the winter wheat from Brian’s farm is also a familiar scene. Brian tells me there are approximately 400 commercial farmers in Zambia, a small group. Like any equal size organization, may of them know and interact: at wholesalers, the market, anywhere people of common ground meet and do business. Of the four hundred, Brian is only aware of a two or three that are native black Zambians. This is not to say there are no farmers, the country is overwhelmingly agrarian. But it is so odd that commercial farming, any effort greater than subsistence, is done by non-indigenous people. Perhaps it is because the poorest in Africa are mere subsistence farmers that the occupation is looked down upon. Or maybe those Zambians with the education or wealth to be commercial farmers choose to live in the cities where more wealth and prestige is possible. In any case, what I see on the drive is successful year-round farming by one very small subset of the Zambia:

winter wheat

juxtaposed by the winter fallow fields of the vast remainder and majority of Zambia; with small acre size plots the owners cannot afford to fertilize.

Never-the-less, from these plots come beautiful vegetables (tomatoes and cabbages) and some of the biggest fruits you will ever see. Avocadoes bigger than soft balls, mangos the size of footballs, and bananas that are sold on every corner of every town. It is very difficult to understand how a nation with such abundance (land, inexpensive labor, water) can be so destitute. I also have to remind myself that I’m seeing Zambia in its most temperate time. The winter cold is gone, the days are like summer in Seattle (with the exception of six hours less daylight), and in a few months the rains will come. Then this will be a very different place.

Monday FK and Leah arrive from Chicago. The same day, Eric Chen comes from China. Eric is the owner of the factory making the rear hubs for WBR’s bicycles. I go to meet FK and Eric at the hotel. When Eric arrives he is very friendly and excited to find out what is happening with his parts. KT (Eric’s company) produces 100,000 coast hubs each month, and they have never heard of such failures that we have discovered. After some introductions and politicking we head to the Tata assembly area to inspect the wheels that were recalled from Ndapula. Once there, Eric gets to see how the bicycles are assembled (a bit roughly – the hammer seems to be the tool of choice), and evaluate the failed parts. Eric decides he wants to see another test. Instead of using the assemblers at Tata, he configures several hubs himself, the proper tension, mounting, all to his personal specifications and effort – he does all the work himself.

The next day WBR’s lead mechanic puts his team to task testing the hubs Eric has prepared. Two bikes are loaded with 50Kg of weight (~100lbs) one with 75Kg and one bicycle has a 100Kg load on the tail rack: that’s 220lbs! Five minutes into the test one of the bikes with 50Kgs on the back is broken. The rear hub has come apart. A few minutes later the 75Kg bike also breaks. Eric is dumbfounded, curious and a bit embarrassed. But amazingly, the bicycle with the largest load is going strong. The test involves riding the bicycles around a circuit, over a few speed bumps and through some rougher dirt terrain. FK notices that the rider on the heavy bike is not using his brakes. And who would? It takes a lot of effort (and balance) to get a bike that heavy moving – so why stop it. FK admonishes the rider to do like the rest: to accelerate and use the brake prior to the speed bump. The hub breaks on the first trial.

Broken Hub after 100Kg test

So now we have 100% failure of the bicycles in our factory test, yet 0% in the field; a very odd situation. After visiting some of the owners in the field, we find a similar story as the one we witnessed at the factory. When the bikes are heaviest, often the owners will walk the bike, or at the very least are riding so slowly that the brakes are not really used. But when we take their bikes apart, we already se signs of wear on the hubs. For those of you mechanically inclined, the brake bar on the hub (reaching from the hub to an attachment on the frame) is made of weaker metal. As the brake is applied the axle simply continues to spin inside the brake. This destroys the axle threading, the brake itself, and eventually the axle.

FK and Eric spend the next day or two touring parts of rural and urban Zambia to see where and how the bike is employed. Eric has several ideas on how to make the hub appropriate for the mud, dust, and heavy wear it must endure to be a viable part. FK is extremely happy with Eric’s enthusiasm and enterprise. Out Zambian mechanic is not so thrilled. The failures are something he has come to expect from both Indian and Chinese goods. I try to encourage our man, that Eric's very presence and effort are a sign that things should improve. His lack of faith is what makes FK's work so important, the Zambians feel they have no voice in the market place. I hope for everyone that this is a step in the right direction.

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