Let me start gently. Today I bought some roses at my local supermarket. Yes, I do treat myself with flowers on a Friday or any other day occasionally (must be a British thing that stuck with me) . But today, I did something different. Having researched flower production in Africa lately, I actually looked at the label before I threw the packaging away.
Bingo.
Kenya!
Or so I thought…..
I went online and checked the name of the company I found on the label: Chrysal Africa….under crysal.com. Oh right, not so Kenyan after all. The flowers were from Kenya, the company was from the Netherlands. It has been producing flowers for over 80 years.
I looked at the flowers and had the YouTube images of Kenyans in mind who picked them and put them into nice little boxes. From their hands, maybe 48 hours ago, onto my living room table…I never looked at my flowers that way. It’s almost as if they suddenly brought a bit of Kenyan spirit into the room.
But here is the point: The flowers were produced by an international market leader. Probably a bad idea for you to start producing roses in Kenya for Europe's export market. Why? Because it means you are up against the big guys. And that’s the story I want to tell in this post. It contains some harsh truth and a straight answer what you need to do about it.
I think this is an important article, and I hope you don’t mind when I am less diplomatic in my language today. It does have an important message in it, so please read it until the end, even if you think I am going a bit off the line.
Truth number 1
If you want to be hugely successful in Africa starting from scratch you better stop procrastinating and start now.
And I mean now, as in this week. Today.
It does not matter if you are an already established business elsewhere or if you have never done business before. You have to start in Africa now or you may be self-sabotaging yourself, because you are missing the right timing for this great opportunity (the perfect timing was probably 5- 10 years ago).
Yes, the opportunities are still vast, this is why we are here, but big international companies and those with a lot of start up capital at hand are moving in at a much faster rate now than just 2 years ago. The wheel is visibly accelerating.
When I started my research in 2012, doing business in Africa seemed like a big open space that no-one really wanted to fill, and except for some Chinese telecommunication giants and some mining and financial companies, not too many seemed much interested. I barely recognised any of the companies that wanted to do business in Africa. While the good news was coming out of Africa, there was the overall impression that the world still needed to be convinced. In 2011, Ernst and Young reported: ‘….investors are slowly waking up to the region’ and in their 2013 report (which was released in the second quarter, probably compiling data from 2012) Ernst & Young stated that: “those already doing business on the continent ranked Africa as a more attractive investment destination than every other region in the world, other than Asia, while those with no business presence ranked Africa last by some distance!”
I am not sure what happened just two years later…..but the alarm clocks are suddenly going off everywhere and companies are jumping out of their comfort zones rising to the occasion. Yes, they are moving in!
Burger King, Mc Donald’s, Loreal, Danone, Walmart, Archer Daniels Midland Co, and top law firms – just to name a few – are either moving into the continent for the first time or have proposed vast expansion plans into more Sub-Saharan countries.
You may remember that the Economist featured Africa in 2000 on its front page as ‘The Hopeless Continent’. But now even the publishers could not help but notice ….’Africa Rising: A Hopeful Continent’ was the Economist’s front page feature in 2013.
I have no idea who does the pushing and who the pulling here – the international companies or the media – but hey, they certainly have a great symbiosis and now they are really enjoying the ride.
Let me actually take this opportunity to voice my frustration that I have been carrying around for a while (just 5 mins and then I snap out of it – join the trend – this is apparently what successful people do): The media – both international and African, Africa blogs, and even Africa Facebook pages focus on the BIG stuff, on the GIANTS…..we read about a $100 million Chinese investment in Zambia….and how one company in Kenya was awarded a $10 million Dollar contract….or that somehow somewhere a new $30 million Dollar manufacturing site is planned …..this is the big chunk of information that is out there……while the millions and millions of Africans, be it on the continent or abroad, who should be driving the continent forward, remain largely without guidance and support – the widespread million dollar investment info is of little use to their own entrepreneurial undertakings !
Harsh truth number 2:
Snap out of it, this is how the world operates. If we focus on complaining and campaigning, Africa’s space will be occupied and ‘powerless’ individuals and Africans will fall back into victim mode (be it collectively or individually). Get successful first, then you can complain and campaign, and people will actually listen to you.
I simply think: We need to rise up, start working, and networking among each other. This is how we drive entrepreneurship and success rates among the masses forward in Africa faster. Together.
But you need to join the pace! You really need to create a sense of urgency.
I got a Skype message from my friend in Ethiopia three days ago, she wrote: ‘Turkish manufacturers, Danone (Yoghurt) and Nestle are moving into Ethiopia, can you believe it, I better hurry…’
Here you go, she is on the ground getting her licences sorted already, and she feels the need to hurry….so why are you relaxed still browsing through the net contemplating that this is something you may want to do …one day.
You need to have that sense of urgency !
I spoke to my cousin’s husband a few weeks ago. He is running an import-export business in Angola, which he started some years ago making an absolute fortune in a relatively short period, because hardly anyone else was doing it at the time and the demand for fast moving consumer products in Angola was so huge. I asked him about the import-export climate in the country and if he would advise people to start trading consumer products in Angola.
His answer was unexpected: “Not anymore” he said…”there are too many business people and investors who got in, the Chinese companies are now doing Expos twice a year in Luanda, and traders get their stuff directly from there. And the Angolan government has made the licensing issue more difficult. I am doing well, because I was there from the start, but it will be hard for newcomers. If I had to choose now, I would go for another country that is less competitive in this regard. Maybe South Sudan or so.”
And this exactly is increasingly the scenario for other countries and products. Yes, by all means be aware of it, so you don’t make bad decisions, but above all, use the info to get moving and start doing business in Africa yourself without delay.
You can use Euromonitor.com to do some of your market research. Simply type in the country and the product and you receive a report. You have to pay a few hundred Euros for a full report, but you get a free short introduction into trends and competitive landscape and that will often give you already a lead or an idea. I have checked several products in the last few months as part of my research, and in some countries the local market for certain consumer products is simply ‘taken’ by the big brands already. You will sometimes also see an indication that this only happened in the last 3-4 years….which brings us back to:
Urgency!
Your success potential is directly related to the factor TIME.
If Nestle indeed moves into Ethiopia, setting up your own chocolate production company may not be a good idea anymore, building a farmer cooperating planting cocoa trees may look like a smart solution, or you need to come up with a different concept altogether. If Danone owns the yoghurt market in the country of your choice, Procter & Gamble do baby care, and Guinness the beer, I would probably stay away from trying to compete with these products, unless you have a unique selling point that makes you competitive. But my point here really is this: if the big brands have not yet set foot into the market, chances are that you become the market leader for a certain product or service, which means you would have a competitive advantage by the time they plan to move in….
Important: Moving in early means that you are able to build your brand with little or no competition winning a loyal customer base, which is very profitable in the long-run.
What I have also observed during my research being directly interrelated with the first mover advantage is the following: Many African start up companies who got started when no-one else did to build their own brands, received a million Dollar offer a few years down the line and were bought by international brands who wanted to move into the same market. And if you did not want to sell your business you would at least be in a position to compete.
Things are moving fast in Africa now and I guess this is naturally accelerating. The more companies we see reporting about their success in Africa (and currently almost all do) the more will subsequently follow the same route.
So here is a reality check: What is holding you back to start your Africa business now when time really is an important success factor? Why are you not starting to work on your Africa business this week? Or this evening?
What are your reasons?
Too busy… no time….
The job…..
The money (lack thereof)….
The partner…..
The children…..
The leadership in Africa…
The necessary planning stages…..
The lack of energy, the bankers, the racists, the system, the corrupt politicians, the colonialists, the worries, the fears, the lack of knowledge, the lack of resources or local connections….?
Cut it all out. YOU are the solution.
Or Africa is moving on without you. As part of the world's global market place.
Those who have realized just that are working on their African businesses already. They are putting their thoughts, their time, and their energy towards BUILDING something for themselves and for Africa. Many have become very successful and their stories inspire us and lead us today.
Get started to jumpstart your Africa business now. The time for a new path to prosperity is right here in front of you with gates wide open.
And if you are still coming up with reasons why you can’t, you may be in need of a harsher treatment.
Now, below is confession time….or in other words, I invite you to share your thoughts
And still. Let's be defined what dosage in this case approaches most of all. There can be it cialis 20mg or something another. To me I think it isn't necessary to choose for you necessary. Think. Perhaps suits you cialis 20 mg It is much better.
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Mine is ‘lack of knowledge’ and ‘the necessary planning’ stages and maybe networking. It’s a harsh reality but much needed. Thanks Doc.