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Expanding your Business into Africa

By Bidvest Bank
19-02-2015
Business in Africa is booming. With a rapidly increasing population of over 1 billion people and a massive potential for even further growth, the continent is attracting huge amounts of attention from large global companies. And, with African consumers becoming more educated, more tech-savvy and hungrier for goods and services, this interest isn’t likely to wane any time soon. 

If you’re a South African business owner or entrepreneur, how do you ensure that you don’t miss out on a piece of the African pie? And more importantly, what things should you bear in mind if you’re planning on expanding your business into this complex continent? Here’s what you should consider:

1. Customise your approach per country. The perception of Africa as one big homogenous country is flawed thinking. Remember that Africa is made up of 54 different countries, all with different cultures, governments and infrastructures. Employ a regional approach and take the time to fully understand the market and its consumers before launching your business in Africa. 

2. Find local talent. You can do all the research in the world but ultimately you need the experts: people on the ground who know the intricacies of that specific country. Trust your instincts when choosing whom to work with. Then, once you’re confident with your choices, invest in training and upskilling these local employees.   

3. Don’t forget about e-commerce. In hugely populated cities with very few formal shopping centres and high mobile phone penetration, e-commerce can be the best way of reaching the masses. But e-commerce has not reached critical mass in Africa yet, so now is the best time to position yourself before it does. 

4. Look to the long term. Expanding into Africa is not a short-term investment that will pay dividends immediately. So employ a long-term vision with an associated strategy and you’ll reap the rewards.

5. Infrastructure and logistics. Instability in terms of water, energy, transportation networks and telecommunication, amongst others, all need to be taken into account. But there are always creative ways around these and they can become part of your key offering. Logistics can also make or break the success of your African operation, so ensure that you have your head around these processes before committing to expansion.

6.  Quality and brand matter: Africans can be extremely brand loyal and this can either be the key to your success or to your undoing. Also bear in mind that quality is key so you shouldn’t take shortcuts. Rather take the time do things properly and provide a really high quality product or service, because quality matters hugely to African consumers. 

As growth in South Africa continues to plateau, venturing into Africa is a huge opportunity for local businesses looking to expand their operations. As a business based at the tip of Africa you already have a strong presence on the continent, which is an advantage over many other international businesses trying to achieve the same goal. This fact alone should give you the boost you need to launch yourself successfully into the rest of the continent.

Expanding into Africa can be made that much easier with a Business Bank Account from Bidvest Bank. This transactional bank account is perfect for small to medium sized businesses as it also provides you with a gold Visa debit card that offers a range of services, banking tools and added benefits. Find out more.