If you’re a foreign company looking to grow or expand, the African market would be a desirable destination. The African market is vast, with up to 53 countries; hence it can be a challenging task, but once you’re able to locate the right business partners that are both efficient and reliable, you’re halfway through.
Since the African market is promising and has so many untapped potentials, it is essential to know that there are pitfalls. Most foreign companies have ventured into the African market and failed severely; well, this failure is induced by their inability to do their due diligence. It is also essential to learn from the success stories and failures of others. It is only wise that you know one or two things about what you’re getting into before you do.
Foreign direct investments over five years had its inflows rising from $19.5 billion to a whopping $26.1 Billion. These results are quite impressive but do not eliminate the fact that an expansion to the African market is a complicated step for foreign companies to take on and see-through.
What makes expansion to the African market a complicated decision for international companies?It’s simple, the fact that they are moving away from their comfort zone into something they are not quite used to.
Before you enter the African market, you might want to consider a few things like operational Risk and others, here are seven effective ways to help you explore the African market and get positive results.
Be innovative and Flexible:Nothing can change the fact that no matter what your business idea is, it is already in play in the market, the only way to stand out is presentation, style, and “what’s new?”. For example, how would you present a new brand of cigarettes to consumers? We know very well that there are already over thousand cigarette brands on the market, well you can sell it from a different perspective, you can say “it is toasted” — I mean all cigarettes are toasted. Still, it has not been presented like that before. To be successful, you must get as creative as possible with your business model and delivery before entry without losing your DNA. Creativity is paramount to sustainable business growth in the African market.
Cultivate good relationships:Don’t get associated with just anyone, and don’t underestimate anyone either. Try to exercise some patience, take time to put the strengths of your potential partners to the test after spotting them and before getting into any form of agreement with them. Study the lifecycle of your deal or approval very well, identify the influencers, gatekeepers, and decision-makers across the deal lifecycle, then be sure to align yourself with them. A country like Kenya is a good example, approximately 50 families are running this country and you would require alignment with at least one family to make any significant headway in Kenya.