- South African entrepreneur Hein Koen is involved in mobile tech and coffee businesses across the African continent.
- Over the years, he has learned hard lessons about doing business in other African countries.
- He shared these with Business Insider South Africa.
To expand your business into other African countries, you need to put in the miles, says Hein Koen, director of Flickswitch, a South African technology firm that assists businesses with SIM card management services. The company has seen rapid growth over the past seven years and has expanded into Namibia, Zimbabwe, Zambia, Kenya, Tanzania, Ghana and Nigeria.
He is also involved in Bean There Coffee Company, South Africa’s first roaster of certified fairtrade coffee. The range of Bean There coffees is available at retailers like Pick n Pay, and the coffee is sourced from countries like Burundi, DR Congo and Rwanda.
“Every country on the continent has very unique business culture, dynamics and “styles” of doing business – much more so than neighbouring countries on other continents,” says Koen.
“You might have a product or service that you know has a need in many countries, but the way in which you take it to market or approach potential local business partners is radically different.
Here’s his advice for South African companies who want expand on the continent.
Get on a plane.
It is extremely difficult to understand the business dynamics of a country (or even a city in some cases) without spending some time there, says Koen
“There is no way that you can remotely understand the nuances of each country’s business style.”
Listen more than you talk.
When going to a different country, South Africans tend to want to explain what has worked in South Africa, instead of listening and really understanding what might be a different (and better) approach locally, says Koen.
Inaction often doesn’t mean what you think it does.
In some countries, especially those with more old-world business styles, inaction or a lack of strong opinion can easily be seen as someone being disinterested.
But in many African markets, this is usually not the case, but rather a reaction to a pitch that is too forceful. This type of selling style often silences potential business partners, instead of engaging them.
Yes can mean no.
In some African countries, such as Botswana, with a very polite business style, you might never get a clear “no”, so listen out and be open to small cues, says Koen.
Sometimes it is best to ask the question quite directly to test whether “yes” means “no”, while in others, with a more “American” or upfront culture, such as Nigeria, you might get a “no, thanks for coming and goodbye” within the first minute!
Leave your arrogance at home.
Just because the South African market may be advanced in some sectors, don’t underestimate the local skills, capability or customer insight. You will find some of the brightest minds and most innovative companies in the most unlikely places on this continent.
It’s expensive, but there are ways to save.
Doing business in some African countries can expensive. Flights, hotels and good local talent can attract big premiums. Try and operate smartly – look for alternative (local) airlines, avoid big-name hotels and AirBnB and use local partners to assist with recruitment.
Don’t believe the interwebs.
Some businesses might only have a dodgy-looking Facebook page, but behind that lies large, very successful businesses.
Traditional marketing doesn’t always work .
Don’t think running a Google search, LinkedIn or Twitter campaign will necessarily give you the same exposure and results in every country. Every country has its own style and business tools. We have discovered things like WhatsApp-friendly product brochure images to be of value in some countries. “WhatsApp is everywhere,” says Koen.
Also, e-mail marketing works great in some markets, not in others. Phone calls work great in some countries, not in others. Physical meetings are essential in some countries, and disliked in others.
Formal or casual: be prepared for both.
The style and formality of business interactions must be understood. Getting that suit and tie out of the cupboard (despite the temperature) is sometimes needed. Also, don’t be surprised if business meetings are opened with prayer or lengthy chatting about the weather.
In other countries, meeting at a bar wearing a T-shirt and slops is totally acceptable, says Koen.
Perceptions are usually not reality.
Some countries have stereotypes associated to them. I have found these mostly not to be true, and sometimes the complete opposite.
Don’t over-value a contract.
Often a handshake deal carries much more weight than a formal contract with limited legal enforcement frameworks.
You need networks.
Networking and creating word-of-mouth still remain crucial for most businesses to succeed in a new market. Don’t think that you will be able to access these easily, warns Koen. Either choose a good local partner, or employ local people with established networks.
Source: Business Insider