6 Priceless Africa Business Tips If You Are Getting Started

6 Priceless Africa Business Tips If You Are Getting Started

Are you planning to start a business or invest in Africa?

Today, I want to share with you some indispensable Africa business tips with those of you who are getting started. As an Africa Business Coach and Consultant I engage regularly with people from various background who want to get started in Africa, and interestingly many feel challenged by the same aspects and consequently, they tend to make the same mistakes.

So I made a list of some bite-sized Africa business tips for start-ups. Being aware of them, will help you to maneuver a little better through Africa’s complex business environment.

 

1. Don’t just get started – fix a local problem or gap

I will be honest with you: Your biggest success factor lies in aligning your business concept with a real local demand on the ground. Fix a problem – meet a need or a clearly growing market demand, and you will be in business. In general term, there is usually a much higher rate of demand than supply across sectors and industries, and this is precisely where you need to come in.

My Advice: When there is so much opportunity, I advice not to come up with a business concept where you try to make a market fit with what you have set out to do (it can work, but responsiveness within your target market may be delayed or never happen to an extent that is very profitable). Instead, take a demand-driven approach. Get your antennas out in an effort to spot opportunity and how you could provide solutions in form of products and services.

 

2. Start with a single market on the continent

“So you want to get started in serving companies in Africa with your product xyz. Great, have you been thinking of a particular market?” – “Yes, I was thinking of South Africa, Kenya, Tanzania, Ghana, and possibly Angola.” Oh no, no – I can see where the challenge lies when you have 54 markets to choose from, but targeting several countries at once with your start-up or your Africa entry strategy is not only almost practically impossible, it just adds up to the lack of clarity and focus among both you and your target market and will hold you back. Remember you are just getting started – you are not Burger King looking for a Million-Dollar expansion plan!

My Advice: Start with a single market. Possibly two if they are in the same region – make sure your market, your business concept, and your personal circumstances align well with each other. That’s key for success. Get started, get the necessary focus, experience, and revenue. Then you can always expand to a new African market later on in a quest to grow your business. That’s another stage.

 

3. Choose a market with high potential but low risk

Yep, they are available, you just need to find them. In my opinion too many first-time entries into Africa are heading straight for the most difficult markets on the continent, often without realizing it. And a year later they still deal with the headaches. These markets may have a high opportunity ratio, but they also have a high level of risk. I would leave those markets to the more advanced entrepreneurs and businesses with previous experiences in Africa. Why make your life and operations difficult from the get go? Exception: An exception are online businesses, as they are generally less affected by corruption, red tape, and unfavourable business environment.

My Advice: Check out my post ‘Starting a business in Ethiopia, Nigeria, Angola, or the DRC? Then Know This…..” or visit the World Bank’s ‘Ease of Doing Business’ Index to compare African markets against each other.

 

4. Get strategic partners on board early on

Partnerships are necessary for the advancement and growth of any business and that is even more so the case in Africa. Of great value – but often overlooked – are so-called ‘strategic partners’. These are government agencies, industry associations, or other businesses who are interested in helping you succeed, as long as you can provide immediate value to their own agendas, members, or operations. In my experience writing them, following this up with a telephone call – or ideally – passing by their office asking for an appointment always works. You may be surprised by the level of interest and value you receive in return for both short-term and long-term projects. I have successfully knocked doors. More than once.

My Advice: Check out the websites of such potential ‘strategic partners’ and be very clear about how what you offer aligns directly with their goals. Then ask for a meeting and prepare a friendly proposition. Make clear what value you can provide and how you would like them to assist your own endeavours. Make sure you offer more than you ask for – or at least keep the balance always in their favour.

 

5. Don’t underestimate start-up costs on the ground in Africa coming in from abroad

Contrary to some perception – starting a business in Africa is not cheap and the more you depend on certain licences and permits, imports of certain good or materials to get you started, and third-part contractors the more time and money you will have to spend. This is in particularly the case in ‘high risk’ markets where responsiveness is low, corruption is high, and systems are ineffective. Waiting and/or bribing someone to get your shipment out of the port 1 month later both cost significantly. You will need a lot of capital for daily subsistence and travel. Also note that there are huge local difference regarding the cost of cargo shipments, taxes, and labour so it is worth doing some comparisons and your calculations before choosing your entry market.

 

6. Don’t get frustrated by obstacles  – see your next opportunity in them

One very crucial but largely overlooked aspect to a successful business are not just market information and strategies, but the investment of time and even money into your own personal growth and mindset development as an entrepreneur. This truly is priceless and will turn you in my opinion into both a better businessman/woman and a much happier person. So when you come across obstacles on your way to success in Africa do not just see them as nuisance, but as another problem that needs to be fixed and which you can ultimately even turn into yet another lucrative business opportunity for you. Once you see opportunity where others see solely a problem, you have indeed developed an entrepreneur mindset. The most successful African entrepreneurs – and I have followed many of them – have done precisely that !

Read my very personal post: “The Truth About A Rumbling Tummy And Africa Entrepreneurship (It’s Not What You Think.’)” to get to the bottom of what may be holding your success back and find out how to challenge yourself.

I hope you enjoyed my latest post and found it useful to your endeavors. Help us build our community here by posting your feedback or questions in the comment section. And feel free to click ‘Notify me’ at the bottom of this page if you do not want to miss my next Africa business tips – the practical way!

 

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Dr. Harnet
Dr. Harnet Bokrezion is the Founder of africajumpstart.com and co-author of the book '101 Ways to Make Money in Africa'. She coaches individuals and consults existing companies assisting them to make smart and strategic business decisions in Africa’s new emerging markets faster and more confidently. Dr. Harnet also regularly writes for the renowned DHL powered publication howwemadeitinafrica.com. Get in touch to inquire how she can be of assistance to your own Africa business endeavors: harnet@africajumpstart.com

User Comments ( 9 )

  • Yusef Sudah

    Each of the listed items are good to make use of with maximum understanding as every start up WILL HAVE EACH OF THESE ITEMS TO MASTER…!

    • Dr. Harnet

      Hi Yusef
      Thanks for your feedback and I am glad to hear you find the list useful!

  • Every time I read your blog, I have new insights into business startups. I love these tips, very useful and practical – I need your advice: I am a working and dynamic young man in Nigeria who run a side business online (affiliate marketing) already earning more than 50% of my salary as income. Now I am looking forward to starting a another business but this time teach working class people how to start their own business before they quit. I know its a service business – how do I start? My mail is ndukweukabi@gmail.com

    • Dr. Harnet

      Hi Oge
      Thanks and I am glad to hear you find the insights helpful. I like your approach, and if you have been able to cover 50% of your income through affiliate products you have a success story to tell and teach others about, so they can do the same. Many people would want that change in their life and more independence, and do not know how. If you are selling affiliate products I assume you are doing so through a website? The best way to now deliver your service is to create workshops or seminar around the subject with a catching title, such as: ‘Leave your job, and make an income doing what you love’ or ‘How I made $ XXX selling affiliate products from home.’ You package that into a local workshop and promote the event where you would find your best prospects….this is one way of delivering your services. But you will need to create trust among people that you are able to deliver providing some free insights or tips – so your website could maybe be a base for that. Hope this helps!

      • Thanks so much – Will definitely implement this as soon as possible!

        • Dr. Harnet

          Hi Oge
          You are welcome. I am glad you found the tips useful. A warm welcome to Africa Business Jumpstart!

  • Thanks for the wonderful tips. I am growing an online business partnering with a large multinational company (FGXPRESS) marketing a range of revolutionary, very fast moving consumer goods. One is the Power Strips which are so unique and effective that they have moved into over 200 countries in just 2 years. The other is the Solar Strips from Marine Phytoplankton, known to be the oldest whole food on earth and providing all the nutrients that the body needs. I have actually mailed you seeking advice and references on talent and how I can grow my business on the African market.
    Greatly appreciate your advice. Thank you so much and God bless.

  • Hi, Dr . Harnet you really have great talent , knowledge and energy to motivate and educate fellow brothers and sisters , keep up the good work , I read almost all of your blogs and they are wonderful , educational and inspiring , Proud of you to have a sister from Eritrea , africa and glad found your site

  • Patrick Iyoha

    Hi Dr Harnet, your posts are quite inspirational to say the least. I am currently on the verge of starting up a machinery sales Company for the food value chain in Nigeria. We look to sell China made machinery for grains/vegetable oil extraction and processing/refining.

    We already have a standing contract with some Chinese manufacturers . We recognise the effort of government to fight youth unemployment through Agriculture as well as to reduce our dependence on crude oil as sole foreign exchange earner. We are posed to play our part in the Agriculture value chain through quality machinery supplies to the indusry.
    Kindly suggest ways to start up, reach prospects and build a brand while staying afloat financially.