What S.African companies should know before expanding into the rest of Africa - CNBC Africa

What S.African companies should know before expanding into the rest of Africa

Southern Africa

by Trust Matsilele 0

What S.African companies should know before expanding into the rest of Africa. PHOTO: Wikipedia

Threats to business growth do exist in the region largely as a result of political instability and regulatory uncertainty but one cannot overlook the opportunities, this is according to Jorge Camarate, Strategy & Partner at PwC.

Camarate made these comments at a time when Africa’s growth prospects have taken a dip especially for countries relying more on commodities.

According to the World Bank, it expects 3.75 per cent to be long-term average growth for Africa.

Camarate added that coupled with the slowed regional growth, the outlook in South Africa was also not exciting.

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“Companies should start by looking at what they are good at instead of looking at where markets are growing,” Camarate told CNBC Africa.

“Companies should start by looking inwards, evaluate why they got to where they are. Corporations should also leverage on their strengths before expanding to neighbouring economies.”

Camarate said there was need for corporations to develop strategies of working in a volatile environment.

He added that most companies were relatively successful when they expand to neighbouring markets but dynamics change when they moved to different types of economies.

(READ MORELessons for S.Africa companies doing business in the rest of Africa)

“Most South African companies are successful in Botswana and Namibia but when they go to Kenya and Nigeria it becomes rough [largely because] these markets are distinct,” he said.

He also added that a different type of economy requires different intervention.

“In high income countries with high levels of sophistication there is need for quality, innovation and branding while in economies with lower levels of incomes like Kenya the requirement is simplicity and cost transformation,” he said. 

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