The company established trading posts at locations along the shores of Lake Nyasa and in the Lower Shire Valley in the late 1870s and early 1880s. As first, its commercial activities were hampered by the requirement to supply the mission stations and by its lack of capital. Its managers, the Moir brothers, concentrated on trading ivory rather than cash crops but faced stiff completion from Swahili traders. From 1883, the company set up a base in Karonga to exchange ivory for trade goods. Ivory was mainly provided by a trader named Mlozi, who also traded in slaves. By 1886, the company's relationship with Mlozi and other Swahili traders deteriorated, partly because of its delays in providing suitable trade goods, and its unwillingness to supply guns and ammunition, but partly as the Swahili traders turned more to slaving, and began to attack Ngonde communities that the company had promised to protect. Its promise to defend the people of the Karonga lakeside against the well-armed Swahili traders seeking slaves as well as ivory involved the company in conflict against the Swahili and their allies. After some attempts at negotiating a settlement between the Swahili traders and Ngonde chiefs failed, the African Lakes Company began to intervene on behalf of the Ngonde. Fighting took place in the so-called "Arab War" between November 1886 and December 1887 and again from April 1888 to March 1889. In the latter phase, it engaged Captain Lugard of the Indian Army, later Frederick Lugard, 1st Baron Lugard to attack stockades built by the Swahili traders in June 1888 and January and February 1889, without success. Its lack of success in this put an end to its political claims in this area also.