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“Africa Is An Addiction I Don’t Even Want My Dead Body To Go Out”

Published 5 years ago
By Forbes Africa

The year was 1980. Ramachandran ‘Ram’ Ottapathu and his classmates would frequently boycott college and take to the streets holding ‘Free Nelson Mandela’ placards, appealing for the release of the jailed anti-apartheid hero. Mandela’s fight was their fight too, and his freedom, their freedom.

Except that this street protest was not in South Africa, in fact not anywhere in Africa, but in Kerala, 4,200 miles from Johannesburg.

Kerala, that leafy green state in the south of India, famously known in tourism brochures and puff travel pieces as ‘God’s own country’, was where Ottapathu, the man who would one day become a retail king in Africa, grew up. His home is in Ollur in Kerala’s Thrissur district.

Ollur, a small town with quaint little churches, is known for its entrepreneurial energy and commercial bustle. It boasts ubiquitous saw mills, side shops selling rolled gold ornaments, and factories making endless wooden packing cases.

It is said that during the First World War, it was here in Ollur that the wooden packing cases were crafted, for military use. The locals are so enterprising and the town, so filled with entrepreneurs that if a young man left Ollur for a job overseas, he was brushed off as useless, never to return.

But not Ottapathu, the now famous ‘O’ of Ollur, who changed this narrative for good. Known to his neighbors as ‘Kannan’, an endearing name in Malayalam (language spoken in Kerala), even now, when he left Ollur for Botswana in 1992, in time, he also took Ollur with him.

It would seem that Ottapathu, the CEO of Choppies, Botswana’s biggest retailer, has employed almost half of Ollur.

More than 500 qualified men and women in his hometown have made the crossover to Gaborone, he says.

“Earlier, they didn’t know what I was doing in Africa,” says Ottapathu. “It was a distant place.”

Even before he arrived on African shores, Africa was on his mind.

In 1980, when Zimbabwe gained independence, a young Ottapathu featured the country on the cover of his college magazine. He wrote the words: “You must be loyal to your past, otherwise, you will go back to your past again and again.”

The Africa affinity was in his destiny, somehow, by default.

“My friends and I used to closely observe what was going on in Africa, because of the struggles in those days,” Ottapathu tells me, a fellow Keralite, in chaste Malayalam, when we meet at his plush duplex apartment at The Regent in Johannesburg on one of his many visits to the city from Gaborone.

While in college, studying for a commerce degree, he admits he was unabashedly leftist, and with his friends, always searching for a cause célèbre. For the uninitiated, communism features heavily in Kerala’s political history.

“At the age of 20, if you are not a communist, you are not a human being,” chuckles Ottapathu. “There are a lot of qualities you possess when you are an ideologist. It’s always helpful going forward.”

Evenings in Thrissur as a student were spent with friends by the busy town square, ironically called ‘The Round’, near the Vadakkumnathan Kshetram (a famous Shiva temple in Kerala), devouring the left-leaning Kerala Kaumudi and Deshabhimani publications and discussing the politics of the day. They also played cricket.

“We would always be on the look-out for a theme [to espouse]… We used to have a sort of defiance to everything, we had totally rebellious thinking at the time,” says Ottapathu.

“I tell South Africans the number of days I have spent on the streets in Kerala demanding the release of Nelson Mandela is much more than what an average South African would have done. I must have boycotted more than 100 academic days [to the cause] in the five years of my college life.”

However, that life, and his thinking, changed when Ottapathu enrolled for his articleship training as part of his chartered accountancy course.

For one, the hours were very demanding. Whilst in college he enjoyed the freedom of bunking classes, he found it difficult to sit for hours hunched over accounting books. He quit in a week. A close friend forced him to return, saying “you don’t have a choice, if you don’t become a professional, your life will be doomed”. Ottapathu is grateful he took his advice and returned to focus on his career. In three years, he passed his chartered accountancy exams in the very first attempt, and “there was no looking back”.

The first son of five children, Ottapathu was born to “a working class family”. His father was a handloom weaver and his mother a housewife who did odd part-time jobs at a construction company. The family was deplorably poor, and from a young age, there was pressure on Ottapathu to make money, so he undertook various part-time accounting jobs.

“We suffered a lot. We were never able to make ends meet. The family had three full meals only about once a year,” says Ottapathu.

“My aim was to get a job, it didn’t matter what job, to earn any income, and take care of the family. For me, everything revolves around family. There is nothing beyond giving a decent living to one’s parents and siblings.”

Ottapathu toiled to lift the family out of poverty, marrying off his sisters, finding jobs for his brother and cousins in the years that followed. His first decent job was in Kochi, a metropolis in Kerala, as a chartered accountant with Apollo Tyres. Soon, he got promoted and transferred to Baroda in the Indian state of Gujarat, further north. It was around this time that the first chapter of his Africa story was written.

While on holiday in Kerala, it was a chance meeting with the managing director of a medical company he visited that launched his career in a completely different geography.

“I had gone there to meet my cousin, and the managing director, seeing me, asked what I was doing and said he had a brother who owned an accounting firm in Botswana and was looking for qualified accountants and if I would like to go. He asked me to send him my CV, which I did and I promptly forgot all about it.”

Ottapathu returned to his regular nine-to-five job in Baroda. The envelope that arrived soon after containing a visa and work permit to Botswana completely took him by surprise. At the time, all he knew about Botswana was it was an African country, and that it had “a lot of diamonds and elephants”.

“I knew it was one elephant for every 50 people,” he says.

On December 18, 1992, Ottapathu left his wife Jalaja and boarded the plane from Mumbai to Gaborone via Nairobi and Harare. On the Air Zimbabwe flight to Gaborone from Harare, his co-passenger was the son of the then Indian High Commissioner of Botswana. His prophetic words still ring in Ottapathu’s ears.

“I was feeling very gloomy leaving my family. But he told me ‘don’t be sad, you are an accountant, and you are going to paradise, you will be a multi-millionaire one day, because that is the opportunity Botswana offers’,” recalls Ottapathu, who arrived in Gaborone with $20 in his pocket, all that was left after giving away $20 to the immigration officer in Nairobi.

Ottapathu joined the Mazars accounting firm on a dour December day. His first assignment was handling the ailing finances of Choppies’ fledgling predecessor, the Wayside supermarket, in Lobatse, in southeastern Botswana, roughly 70 kilometers from the capital Gaborone and close to the South African border.

To Ottapathu, it was the middle of nowhere, far from the bustling temple precincts of his hometown in Kerala.

The company had huge financial issues. Founded by Farouk Ismail of the Chopdat family (of Gujarati origin) in 1986, the Wayside supermarket was largely a shopping destination for Zambians and Zimbabweans not allowed access to South Africa during apartheid. There were regular train services that terminated in Lobatse, where they would buy goods such as watches, radios and sewing machines, and return.

“When apartheid ended, the train services stopped and the business just collapsed,” says Ottapathu. “But the one good thing about it all was that I could experiment. Anything we attempted was an improvement. The business slowly started turning around.”

By 1997, things were looking better, much better. Ottapathu had managed to steer the company out of its financial quagmire. In 1999, the company opened its first superstore in Gaborone West, which still exists. Ottapathu was appointed CEO in 2000.

“It opened our eyes to the potential of the business,” he says.

But the real turnaround was yet to come, in 2002, when Choppies’ first hyperstore opened in Gaborone.

“That store was the biggest success. It gave us an address and identity. It is still one of the biggest trading stores turnover-wise, in Botswana, doing almost BWP200 million (about $18 million) a year,” says Ottapathu.

The Choppies model was providing high-quality retail products at good value to the lower and middle LSM in smaller towns, through acquisitions of smaller franchises, but also effecting Botswana’s switch from informal to formal retail.

In Botswana, 20% of Choppies’ revenue is from its own branded products, about 50 of them, including sugar, flour, rice, juice, maize and cooking oil.

“In 2004, when the first devaluation of the pula came, all the [informal] Indian traders got a shock. So that gave us an opportunity to buy out a lot of stores from them at very good prices. They were running franchises. In 2003, we were operating Friendly Grocers, OK Foods and Spar. In 2003, we started doing well, so they wanted us to buy more from them, and started putting pressure, so we said ‘we are going alone, you can take your franchise’. That’s when the turnaround happened. That’s when we changed the name to Choppies [after the Chopdat founders].”

That’s not all. Between 2002 and 2007, the company “grew seven times”.

“We have never since had any financial issues. When we started talking to the banks for finance, and projected our financials in 2003, that we were going to have a BWP1 billion ($89 million) turnover, the bank manager would tease me saying ‘you are not normal’. He said ‘even bigger South African companies won’t get half of that, so where will you get it’? And we achieved it in 2004-2005.”

Festus Mogae, the former president of Botswana, was appointed Choppies’ chairman in 2008.

The company’s turnover in 2015 was BWP6 billion ($533 million).

Today, Choppies runs 170 stores across Botswana, South Africa and Zimbabwe. West Africa is not being considered for the moment, but Choppies is entering new and underserved markets in Kenya, Tanzania and Zambia; even Rwanda is on the cards. It is on course to roll out 200 stores by the end of 2016. The company is growing at 25% every year, and Ottapathu says Choppies is cash-plus.

“We need to grow at 50% to get to 200 stores, and we can see it,” he says.

Listed on the Botswana Stock Exchange in 2012, Choppies’ secondary listing on the Johannesburg Stock Exchange, Africa’s biggest stock exchange, from May 2015, is doing well. Choppies is expecting to eventually get “$700 million that will be put into the Africa expansion”.

Choppies entered South Africa in 2008 with a distribution center in Rustenburg, located strategically on the transport route to Botswana. It currently operates more than 60 stores in the country, and that number is growing every month. In an intensely competitive retail environment, with majors such as Shoprite and Pick n Pay, Choppies targets Tier 2 and Tier 3 towns, and says it’s doing extremely well in Limpopo, North West province, northern Free State and Mpumalanga.

“We have been competing with South Africa for a long time. Our market share is over 36 percent. There is no other African retailer with that kind of market share in any market,” says Ottapathu, who became a shareholder in 1999, and currently owns 20% of the company.

And his personal net worth, considering he came to Africa with $20 in his pocket?

“I haven’t counted,” he laughs. “I normally don’t.”

Prod him further, and he reluctantly says it could be $300 million.

At heart, he is a simple man who has not forgotten the poverty, pain and hunger that defined his youth.

He says he wears suits only when he meets Botswana president Ian Khama, and displays few trappings of wealth, although he owns two private planes, a Beechcraft and Embraer, parked at Lanseria airport when in Johannesburg.

“It’s quicker connecting to Africa that way,” he says.

It may seem that Ottapathu’s destiny was a foregone conclusion to many. Misty-eyed, he recalls the words of his mother’s sister, an aunt he truly loved, who had no children and passed away before he made that first trip to Africa. His greatest regret to this day is she didn’t live to see him successful.

“She used to like me very much, and often told me, the way you are growing up, you will even one day own a plane, and I would laugh. My regret is I couldn’t look after her.”

Ottapathu lost his father in 2002, but is grateful both his parents saw his success, visiting him several times in Botswana. His 80-year-old mother lives in his family home in Kerala.

He says the true value of wealth is beyond money, it’s enjoying what you do, and never losing focus. After he first arrived in Africa, it took him four years to visit Kerala – he was that involved in his work. From 1992 to 2003, he says he may have visited India only for 30 days in all.

“I don’t have any aim to achieve so much wealth. I would rather have ambitions relating to the business. My immediate aim for Choppies is to get a billion-dollar turnover. And increase the number of employees from 11,000 to 25,000,” says Ottapathu.

He is known to be a shrewd businessman, never mincing words, but his enterprise and clean reputation have won him admirers on the continent.

“The most remarkable thing about him is the sort of speed and ease with which he moved from working for this accounting agency to taking the opportunity to turn entrepreneurial; the ease with which he saw how parochial we tend to be in big businesses in South Africa and by extension in Botswana, that the approach is local, and he saw that was the niche, in the process explaining how he managed to quickly move into new markets. That sort of global outlook makes him a true citizen of the world,” says Luke Spiropoulos, who met Ottapathu three times as part of his master’s degree research on the migration and mobility of Indian communities in Southern Africa, with the Centre for Indian Studies in Africa and University of the Witwatersrand.

“When he came here, he didn’t have a lot of options at the time but his professional advantage over the others seems to be a particularly sharp knowledge of tertiary education in India, by bringing people in with high-end qualifications. He has a good feel for the human resources market in India,” says Spiropoulos.

Ottapathu says his humble upbringing shaped his belief-systems.

“I am a strong believer in karma. I always say my two hands are my God. Whatever I do the right way, I always get it back. Being a knowledge worker, you use your brain and your hands.”

And not for him ephemeral success.

“Have a long-term view. Don’t look at fortune created overnight. It’s a long-term process rather than an accident,” says Ottapathu.

This is the advice he constantly gives his 23-year-old son Balram, a finance and economics graduate from Wharton, currently studying in Princeton in the United States. His daughter, Bhagyasree, is only 10.

Will his son take to retail like him?

“My father didn’t give me anything,” says Ottapathu. “So he must decide what he wants to be. Sachin Tendulkar [Indian cricketer] said about his son, ‘I can put cricket into his brain, but not into his heart’. Likewise, it has to come from his heart. Eventually, he may take to retail consultancy.”

And the future of Africa?

The future of retail, he says, is smaller stores, given that “hypermarkets are shrinking around the world”.

“The politics is what is putting Africa behind. At Choppies, we try to be neutral, and not align with anything, and work with official channels. Africa is certainly open for business. The growth opportunities here are much better. One day, companies like Walmart will do much better; it will start flexing its muscles. But it will be good for retail in general.”

Will he ever take Choppies to India, just like M.A. Yousuf Ali, the Dubai-based billionaire from his hometown in Kerala, did? Ali opened the gargantuan LuLu Mall in Kerala after a slew of hypermarket-successes across the Middle East.

No, says Ottapathu.

“Currently, we have better returns for our capital here in Africa. We don’t want to lose focus on what we are doing here, if we start doing things in many places.”

But he just might forge the Africa-Kerala connection on celluloid though.

“I have been approached to produce films. I just may. If it happens, the movie will be shot in Kerala and Botswana, linking both countries.”

You just cannot take Africa out of him.

“Africa is an addiction,” concludes Ottapathu. “I don’t even want my dead body to go out.”

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Related Topics: #biggest, #Botswana, #CEO, #Choppies, #employment, #March 2016, #Ramachandran ‘Ram’ Ottapathu, #Retailer.