With a host of expanding economies and ongoing development projects in Africa, investing in this continent is a tempting idea and it is more enticing if your business is doing pretty well in your local or regional market. When it comes to breaking into a new market, especially Africa, a look-before-you-leap approach works best.
If you have some ambitions to go international and expand your business in Africa, in this blog post, we are sharing the secrets of entering new and emerging markets with confidence.
- Select the right country
With 54 countries, deciding which country to select for an export project is a daunting task. Nevertheless, here are some ideas to help you structure your project:
- What is exactly your product?
Depending on the level of sophistication of your product, you may want to classify the potential markets according to the level of maturity of the customer markets and its size.
- Look regionally
Because the size of the African markets is relatively small, adopt a regional approach for your export products. Africa is divided into several trade regions:
These regional blocs aim to reduce barriers entries for products and align trade policies. When exporting your product or services, take into consideration the region of export of your product and take benefits of the regional agreements to reach neighbouring countries.
- The Language
Do not under-estimate the language and cultural barriers. You should look at your internal resources from a language perspective to determine where you would like to start. You might need the services of a translator to help you with your admin papers. It is likely that your embassy in the country offer such a service or is able to recommend the services of a good translator.
- Test before you roll out
The idea is to sell directly to the market where you are trying to enter. For instance, if you are targeting a country in Africa, then you can get your product into the stores in that country and then see how things go. You can get a reliable local distributor or agent as they have more contacts than you. Be realistic with your objectives. This is an opportunity to develop your network as said earlier potential customer markets are smaller than in Western countries.
- Find distributors
The easiest way to reach success is to develop partnerships and joint ventures with local distributors. They know the markets and know how to position your brand. Invest in developing your network and provide marketing, operational support to your distributor.
There are several resources you can use to find a local distributor for your products:
– Ways to Cap is a market place connecting prospective buyers and sellers in Africa;
– Alibaba, the popular website is undeniably a source to find potential buyers for your products.
- Travel locally
The best way to know a country is by visiting that place. And if you are travelling to Africa for the first time, you may:
- Contact the embassy
- Contact the Foreign Trade Chamber of Commerce in your country. They support businesses both in your country and in Africa.
- Enrol on a trade mission organised by your government and other trade organisations.
- Attend business conference in the continent (for building networks).
- Seek Help
When venturing into Africa, know that you will never be short of support. Look at business platforms such as Africa Business Venture or other facilitation services platform.
You will need the following support if you are serious about your export venture:
- A local business developer to help you establish a local network a strong footing
- A lawyer to help you deal with tax and regulatory issues related your business
- Market researcher for verifying your assumptions
No matter the country in the world you want to export your products or services, exporting is a huge investments for companies. Seeking support can be costly but our experience show that companies with the highest return are companies that did not rush their export project but instead took their time to fully understand the realities of the local markets.