There’s no one right approach and successful Western investors use their local partners to create different strategies that work in each region. There’s room for growth in all sectors of the African economy. Mining and natural resources have attracted the most interest, but technology and internet related sectors are growing rapidly as well. Success requires a focused approach to investment.
Local Partner Companies Bridge the Gap
Once a firm has identified the segments of the market they want to invest in, intermediaries such as Shikana Law Group can help them find local partners to establish their foothold. They help with due diligence and eliminating any misunderstandings with local partners. This is necessary in African markets. Many businesses fail when collaborating with African companies simply because of cultural differences in the way.
Another reason that businesses fail in Africa is because they try to follow traditional Western business models. These won’t work due to significant cultural differences. That doesn’t mean businesses can’t succeed – it just means they need to be open to new practises. Firms trying to establish themselves have to embrace independent advisors like Shikana as well as local business partners.
A Diverse Continent with Unique Challenges
Africa is a continent made up of more than 50 different countries and at least 1000 different languages. It’s a mistake to view the continent as one homogeneous market. It’s not. Western investors can’t expand into these markets successfully without the use of local expertise. There are just too many obstacles to overcome.
