Expansion géographique en Afrique (document enanglais)
Thèse : Expansion géographique en Afrique (document enanglais). Recherche parmi 300 000+ dissertationsPar GMirabella • 13 Juillet 2013 • Thèse • 1 276 Mots (6 Pages) • 939 Vues
Embarking on Growth in Africa:
Key Considerations for Geographic Expansion
Market Insight
Is Growth on the Horizon?
Growth in African markets has been at the top of chief executive officers’ agendas in recent years. Much has changed since The Economist labelled Africa as “The Hopeless Continent” I0 years ago, with the latest predictions forecasting that seven of the world’s top I0 fastest growing countries in 2015 will be in Africa.
According to Frost & Sullivan's Mega Trends, Africa is likely to present significant
opportunities by 2020 across key sectors, including manufacturing (€100 billion), energy (€350 billion), agriculture (€90 billion), oil and gas (€230 billion), water (€190 billion), and infrastructure development (>€390 billion).
Whilst the facts present a great case for expanding into Africa, the decision itself can be considerably more complex. Stories and analysis of the growth in African markets are often discussed on a continent-wide basis, presenting Africa as a large and homogenous market, which is far from reality.
As with any pipeline of growth opportunities, it is important to strategically assess, prioritise, and focus opportunities, selecting only those most suited to the business. This helps ensure directed efforts and maximum value from the efforts of expansion. Unfortunately, access to the correct data is essential for this. It is often under the assumption that Africa operates in a different manner to other parts of the globe, but the heterogeneity across its 54 countries
can provide further complexities to prioritising opportunities and developing entry strategies.
Although Africa has shown great developments in infrastructure, governance, regulation, and record-keeping (both historic and current), data availability remains much more disparate compared to developed countries. This means that economic, market, and demographic data are often difficult to come by. In addition to data challenges, there are further obstacles to be considered when sourcing and selecting strategic partners or reliable suppliers.
For many companies, the combination of the vast number of countries and lack of availability of information can leave them uncertain on how to approach their expansion into the continent. Whilst the “how” is generally the biggest question our clients ask, a better starting point is the “where”. The specificities of regions, countries, and even markets within countries mean that the entry strategy generally needs to be customised to the strategic markets identified.
The successful selection of the most suitable markets to enter are generally based on a combination of in-depth research on the specific countries and markets, combined with an assessment of current operations. Internal factors such as company strategy, internal capabilities, and product portfolio's need to be matched to markets showing greatest potential whilst providing sufficient infrastructure, resources, and a context that encourages the conducting of business. This matching of internal capabilities to the market allows companies to develop a roadmap of lucrative and accessible growth opportunities.
Consequently, they are able to unlock maximum value for the effort whilst not stretching current resources beyond their maximum capacities. To achieve this, it is often necessary to take on a growth partner with deep market knowledge and on-the-ground experience in African countries. Frost & Sullivan's approach to geographical expansion can be described in five high-level steps.
I. The External Analysis: High-Level Prioritisation
The first step is to assess the countries and markets in scope. Analysing the countries' metrics around macro-economic variables, political stability, infrastructure, technology, socioeconomic development, legal frameworks, and policy developments can provide sufficient information to begin narrowing the scope of the expansion.
Once the scope of countries has been narrowed through prioritisation based on these high level metrics, the industry (and sub-industry) analyses become key to filtering the potential opportunities. This includes the assessment of clients, market size and growth, market structure and distribution channels, drivers and restraints, substitutes and complementary products, as well as industry-specific regulations and policies.
Scoring markets on these metrics will allow you to further narrow down the scope of opportunities, leaving you with markets that provide
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