Not even the sky’s the limit for Africa’s first homegrown smartphone, with Mara Group CEO Ashish Thakkar planning to take a ‘Made in Africa’ Mara phone with him when he journeys into space as part of Virgin Galactic’s maiden voyage next year.
Thakkar revealed this ambition during an interview with Engineering News Online on the sidelines of the second South Africa Investment Conference this week, at which investment commitments of R363-billion were made.
During the inaugural event in 2018, the Mara Group stole the show when Thakkar confirmed that the company would be investing $100-million in South Africa to build a high-tech smartphone manufacturing plant, having already committed to a similar venture in Rwanda.
Despite initial scepticism, the state-of-the-art factory has indeed been built at the Dube TradePort, in KwaZulu-Natal, and was officially opened by President Cyril Ramaphosa on October 17. Ten days earlier, Rwandan President Paul Kagame opened the Kigali facility.
The Mara Group has injected the equity portion of the finance and, in South Africa, it has received project finance from the Industrial Development Corporation and working capital and trade finance from Standard Bank. The Mara Group is a pan-African company with operations in the technology, financial services, manufacturing, real estate and agricultural industries.
Thakkar says the investment experience in South Africa, which is the larger group’s twenty-sixth investment destination, has been overwhelmingly positive, and has helped to ensure that he was able to deliver on the investment pledge made in late October 2018.
“As per our commitment we have delivered Africa’s first high-quality affordable smartphone manufacturing facility. There are about 200 employees in the factory, of whom more than 60% are women and over 90% are skilled and educated, but previously unemployed, youth,” Thakkar enthuses.
The South African and Rwandan factories, he stresses, are not mere assembly plants. “This is real manufacturing. We are making the motherboards here, which is a really big deal.”
Both factories incorporate machinery and production processes that are in line with those used to produce other well-known global brands and have already started producing two models, known as the Mara X and the Mara Z.
The phones bare a distinctive engraved Lion logo on the back and the Mara X is currently retailing in South Africa at R2 999 and the Mara Z at R3 999.
The phones are available online through maraphones.com, but partnerships are also being created with South African telecommunications firms, as well as large domestic retailers in an effort to raise market visibility and penetration.
The units incorporate Google’s Android One operating system and a display that is protected by high-strength Gorilla Glass. They also feature turbo charging, fingerprint and facial-recognition security and a Dolby sound system. Mara Phones has also partnered with Google to offer unlimited free storage of photos and videos.
Thakkar says Mara Phones is seeking to strike a delicate balance between quality and affordability by implementing a “long-game” business model that incorporates low margins at the start in an effort to grow volumes.
“We are not compromising on quality, so it’s down to keeping a really low margin and banking that the economies of scale will eventually kick in. I would love to keep my price higher until I build scale and then reduce the price, but it doesn’t work like that, unfortunately.”
Nevertheless, he is confident that the business will be able to scale-up and, in South Africa, Mara Phones is targeting an eventual market share of between 20% and 30%.
“In the next few years we are hoping to be selling 10-million to 20-million phones a year. It won’t happen overnight, but we are confident that the large telcos, the large retailers and the banks will appreciate this ‘Proudly South African’ product . . . made by Africans, for Africa.”
Mara Phones will also home-in on the public sector market, given government’s local-procurement commitments.
Thakkar has been taken by surprise, however, by the international appetite for the phone, with orders having already been received from several countries outside of Africa.
“The original plan was always that we would be an African brand, made in Africa, for Africa full stop. But in certain countries there is a shift in buying appetites away from traditional suppliers and ‘Made in Africa’ is a bit of fresh air.”
Through the company’s tie-up with DHL, it is able to deliver a phone anywhere in the world within a week. To date, the company has shipped phones to 41 countries, with the top-five export destinations being Germany, the UK, the US, Italy and Switzerland. It has also received distributorship applications from India, Nepal, Bangladesh and Canada.
“The fact that we have already exported to over 40 countries without targeting those markets or marketing to those countries, we think the sky is the limit! Actually the sky’s not the limit, because I’m flying into space next year as a founder astronaut on Virgin Galactic and I will be taking my Mara phone with me.”