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2. Expanding a Business

Africa Entering the Market

As the world's second largest, and second most populous continent, Africa would seem to be an obvious choice as a trading partner, or as somewhere to do business. Add to that huge wealth in natural resources, a young population and a rising middle class of potential customers and the arguments in favour of doing business in Africa seem obvious.

Yet many companies that have established an overseas presence in various parts of the world have yet to successfully trade in or with the African continent.

And by defining Africa in and of itself as a potential trade partner is one of the inherent dangers faced by companies with this broad agenda. For Africa, as well as being huge, is also hugely diverse.

For simplicity sake, we've chosen here to give generic advice on starting a business in Africa, or on expanding a business in Africa. But in the same way that South Africa is thousands of miles away from Sierra Leone, so culturally, linguistically and economically are the two neighbouring states of Angola and Zambia, or Kenya and Cameroun.

To do business in Africa it is important to follow the normal commercial rules - will my product sell in the African market, is there demand for my services in Africa, is my pricing structure appropriate etc. But there are also different rules of doing business, and indeed those rules will change depending on which part of Africa you choose to do business in.

To do business in Algeria, you may need to converse with potential partners in Arabic but to do business in Zimbabwe then English will be better.

To do business in another part of Africa, religion will play little part in your decision making process, whilst in another it might be the first question you need to ask.

The opportunities to do business in Africa are endless - with key markets ripe for development - agriculture and raw materials through to telecoms and tourism

As with trading anywhere in the world, local knowledge is paramount. Research the market thoroughly, research your potential partners ( distributors, sales agents etc) equally thoroughly. Find yourself a trusted friend who can advise on the complex issue of doing business in Africa. Find an organisation with a network of suppliers, who know the legal issues you may face, and importantly knows which questions to ask - and who to ask.

Below we've put together the headline statistics for the majority of the African countries, but use these pages to find the right suppliers to help your company start trading in Africa.

Click here to Ask an Expert about Expanding a Business in Africa