Since this series started, we have examined how cultural and taste differences can quietly destroy a product that has every other advantage working in its favour. Organizations must close the gap between what a product delivers and what a consumer's palate wants. We saw, through the story of Snaps and McDonalds in India, how a formulation built for one market can become a liability in another, and how organisations often compound the original product error by applying sales pressure to a problem that no amount of selling can solve.

The conversation today has less to do with what the consumer feels about the product and more to do with what the numbers say about the product's right to exist. This factor is the cost of production. While it may appear at first glance to be a finance conversation rather than a marketing one, I want to challenge that framing from the outset. When the cost of producing a product makes it impossible to price competitively, impossible to sustain margins, and impossible to generate a commercial return, it is a marketing problem as much as it is an operational one. This is because a product that cannot be priced right cannot survive the market.

Nigeria has delivered four major devaluation shocks (1999, 2008, 2016, 2022–24), the last erasing over half the naira's dollar value in twelve months. Businesses that stress-tested for 20% swings faced 50%+ moves. Products with imported inputs or finished goods had their cost floor pushed past viable price points, not from demand erosion, but from currency mechanics no operator controlled. The same impact occurred when the 2022 Russia-Ukraine conflict drove global wheat prices up over 50%, hitting import-dependent bread, pasta, and biscuit manufacturers simultaneously with FX pressure. Some products were withdrawn on pure cost issues, not consumer rejection. Cadbury Nigeria's cocoa exposure offers the counter-case: decades of investment in local farmer sourcing, hedging, and reformulation capability have functioned as active margin protection across multiple price cycles.

Passing cost increases straight to price is arithmetically sound and commercially dangerous for products still building consumer equity. Established brands have a loyalty reservoir that cushions price increases; new or mid-stage entrants face a fresh purchase decision with every increase. The 2022–23 Nigerian noodle market illustrates this asymmetry: Indomie's scale, supplier leverage, and portfolio support let it absorb cost pressure longer than smaller challengers gaining share on price competitiveness. Those challengers either raised prices and lost volume or held price and bled losses. Both paths ended in withdrawal. Price-increase viability is directly proportional to accumulated consumer loyalty; protecting an unproven franchise sometimes requires absorbing pain elsewhere rather than transferring it to a consumer who hasn't yet committed.

Three destinations exist for cost pressure: margin (limited runway), operational cost reduction (requires cross-functional discipline), or consumer price. The below suggestions can help manage the cost pressure.

•Labour: holding non-critical vacant roles temporarily redistributes cost savings into margin protection.

•Packaging: Unilever's smaller pack sizes across African markets during contraction cycles reduced per-unit input, packaging, and transport cost, preserving both affordability and margin.

•Vertical integration: Dangote's control of inputs from raw material through finished product (cement, sugar, flour) is the clearest Nigerian model of structural FX insulation. Reduce import dependence deliberately.

Redon (not real name) is an imported finished-good product launched during FX stability, competitively priced, correctly positioned, and well received. Naira devaluation converted its entire foreign-denominated cost base directly into rising per-unit naira cost, with no local manufacturing or sourcing buffer to absorb the shock. No cost reduction opportunity existed because the cost structure was the import cost. The product had to be discontinued as continuing it with the hope of currency recovery is not a strategy, and a margin-restoring price increase would have eliminated the product's original value proposition. The structural FX exposure was not a marketing or sales failure. One safeguards that could have prevented the FX exposure was a phased localization plan shifting the cost base into domestic currency.

The organisations that manage cost of production risk most effectively are the ones that have built genuine cross-functional accountability around product commercial health. The brand manager understands the cost structure, the supply chain director understands the consumer price elasticity, the finance director understands the market dynamics, and all three are making decisions in an integrated framework rather than in separate rooms. Know your cost structure before you launch. Stress-test it against the scenarios that your market makes probable. Build the operational levers that give you options when the environment shifts. And if the numbers ultimately stop working, make the decision to discontinue early rather than late. Delaying discontinuation compounds the losses.

Oluwole Dada is the General Manager at SecureID Limited, Africa’s largest smart card manufacturing plant in Lagos, Nigeria.