Sub Saharan Africa Workshop @METEC 2019: Successful premiere

African and German firms discuss market potential in Africa

Key players from Africa and Germany exchanged ideas on how to do business in Africa at the METEC 2019 Sub Saharan Africa Workshop. This workshop focused on the challenges and opportunities of the African metallurgy market. Speakers from a variety of African and European countries and companies were invited to hold presentations and participate in panel discussions thus giving the international audience an excellent insight into the African markets. The METEC Sub Saharan Africa Workshop took place for the first time on June 26th, 2019 during the METEC trade fair in Dusseldorf, Germany. It was initiated and organized by africon GmbH in close cooperation with Messe Düsseldorf and “The Mechanical Engineering Industry Association” in Germany (VDMA) represented by Dr. Timo Würz, Managing Director of VDMA Metallurgy. More than 50 attendees participated in the high-level workshop.

The Event

The event was characterized by an open and lively exchange between all participants and panelists. Opinions were exchanged, similar and differing ones debated, and many conclusions drawn. Several key challenges not only to European firms, but to African nations and industries were identified.

The following recommendations arose:

  1. European firms should consider Africa as a market. Although often small and sometimes challenging, some African markets can be very profitable and provide huge long-term growth opportunities. Many Africans already appreciate European quality.
  2. International firms have to understand that Africa is a huge and diverse continent. Especially smaller firms will not be able to deal with all countries at once. Clear priority countries have to be defined early on.
  3. Skills are a critical bottleneck locally. Training and education for staff is a key to success. Organizations like the German VDMA are in a position to support here as well.
  4. Providing adequate aftersales service is key for EU machine suppliers to African customers. To achieve this at reasonable costs, teaming up with other suppliers or utilizing locally present external service providers can be beneficial. Creating service hubs in certain countries can be equally help. E.g. Kenya can be used as a hub for East Africa.
  5. German firms often have to show flexibility in their commercial terms and conditions, as well as showcase cultural understanding for the other involved parties.
  6. German firms – wherever possible – have to check on their pricing models as this is still a huge issue. In that context, modular/scalable solutions are often highly appreciated. Offering German solutions made in lower cost countries like India can be interesting entry level options as well.

“As africon, we were very pleased to see a lively event with valuable insights for both existing market players and new entrants. We hope the valuable contacts exchanged on the event will bear fruits in future”, summarizes Mr. Marc Zander CEO and Partner africon GmbH.

More Details about the Programme

Panel 1 addressed: Needs and expectations of German/international metals production, metals processing and metallurgical machinery sectors when looking into doing business in Africa (e.g. technology, education & training, competition, etc.)

The Panelists included Dr. Tim Nikolaou (Managing Director, Frech Group, Germany), Mr. Cedrick Lusaka (Area Sales and Project Manager – Africa, Maschinenfabrik Herkules GmbH & Co. KG, Germany), Mr. Solomon Mulugeta (Director, Ruhe Consult and General Manager, Ethiopian Association of Basic Metals and Engineering Industries), Dr. Norbert Völker (VDMA department of educational policy / Skilled workers for Africa Project Manager), Mr. Glen Dikgale (President, South African Institute of Foundrymen (SAIF), South Africa. The Panel was Moderated by Marc Zander (CEO & Partner, africon GmbH).

Panel 2 addressed: What the African markets offer to and need from German/international metallurgy, steel casting and metal companies willing to start business in Africa? (e.g. market potential, financing, local support)

The panelists included  Mr. Till Schreiter (Managing Director, ABP Induction Systems GmbH, Germany), Mr. Bobby Johnson (Sector Chairman, Kenya Association of Manufacturers KAM, Metal & Allied Sub Sector as well as Director, Steelmakers ltd, Kenya), Mr. Ime Ekrikpo (Director Steel & Non-Ferrous Metals Department, Ministry of Mines & Steel Development, Nigeria), Mr. Gupta Gagan Santosh (Chairman, Kamal Steel Group, Tanzania), Mr. Dieter Brandstätter (Managing Director, ANDRITZ Maerz GmbH, Germany ). The panel was moderated by Friedrich Wagner (VDMA department of foreign trade).

For any more info, do not hesitate to contact us.

Bertrand Mignot joins africon GmbH advisory board

africon GmbH prides itself in having a very experienced advisory board. The advisory board which has significant long-term Africa experience guides and advises africon GmbH in its current growth phase and contribute with ideas, contacts and local know how. We are very pleased to have another member to our board, Mr. Bertrand Mignot. Mr. Mignot was a Senior Consultant for the German Development Cooperation (GIZ). He was formerly in management roles at Deutsche Bank, Renault Nissan Bank, First Bank of Nigeria, Rawbank. His main focus is on financial services, IT and health. He has a BSc Business and Engineering from University of Coventry and an MBA from Mannheim Business School. We look forward to having Mr. Betrand in our advisory board and strengthening the growth of africon.

africon and Wolk After Sales Experts join forces for Africa

We are proud to announce that africon GmbH and Wolk After Sales Experts are joining forces for Africa.

Both German consulting companies are leaders in their respective fields, namely global automotive after sales industry and Sub-Saharan Africa business environment. Together Wolk and africon will be able to provide clients with comprehensive information and consulting support across the continent.

Since the beginning of its operations in 1994 Wolk After Sales Experts has grown into a consulting powerhouse well known to both vehicle manufacturers and independent aftermarket operators. Thanks to carefully built network of partners across Europe, Wolk monitors automotive markets in 35 countries – from Portugal to Russia and from Norway to Turkey.

In one world economy our clients need support not only in Europe, but on the other markets as well. Our cooperation with africon will allow us to include data from Sub-Saharan Africa into our AFTER SALES ACCESS aftermarket business intelligence tool. This will be a major asset for any automotive company aiming at creating or improving its distribution network in Africa” explains Zoran Nikolic, Managing Director at Wolk After Sales Experts.

africon GmbH, established in Germany in 2011, currently has offices in Nigeria, Kenya, Tanzania and South Africa. The company employs a team consisting of 7 nationalities speaking more than 10 local languages while running a network of more than 50 consultants in the African region. Over the past 5 years africon conducted more than 20 automotive projects in Africa.

The African automotive markets have been growing with more than 6% over the past years and offer great chances for global operating companies. After various independent aftermarket projects in Africa, africon could obtain significant data and know-how on African markets like Nigeria and Kenya which we are happy to offer to the excellent network of Wolk After Sales Experts” states Marc-Peter Zander, CEO & Partner at africon GmbH. Mr. Zander will be also a keynote speaker during upcoming Aftermarket Forum 2019: Going global! It is a top-level automotive industry event taking place on April 17th in Frankfurt am Main, Germany and organized by Wolk After Sales Experts. This year’s edition will focus on market snapshots of different regions of the world and Sub-Saharan Africa will be covered by the representative of africon.

In day-to-day business operations Wolk After Sales Experts and africon together will provide clients with exclusive market research, market intelligence and consulting projects in African countries.

africon presents on “Independent Aftermarket” in Frankfurt

Over the past 4 years africon has been supporting IAM (Independent After Markets) automotive clients for their Africa growth strategy with research and data. A clear focus has been on the markets Nigeria, South Africa and Kenya where africon supported clients in the business fields of filters, spark plugs and engine parts to grow their business.

Within a forum organised by the company Wolk After Sales Experts, Marc Zander, CEO & Partner at africon presented the chances in Africa for IAM companies and recommended the following key points to observe with a market entry into Africa: Increasing know how on the African market to understand the market value chain; increasing sales efforts to be closer to clients and partners; selection of key distributors who also serve the informal markets.

“Over the past 5 years Africa has been growing with more than 6%. This offers great chances for automotive companies in the IAM sector”, concludes Marc Zander.

africon CEO Mr. Marc Zander – Interview ” Investors lack info”

CT Executive Search Specializes in senior recruitment in the emerging markets, leveraging its proprietary research capacities in Moscow at a network of partners in Asia, Africa and Eurasian Economic Union. CT Executive interviewed africon GmbH CEO and Partner Mr. Zander last October to share insights about investors information and relations in Africa.

The interview started by covering African countries with most financial demand and highest potential. Mr Zander outlined the most important factors that drive Foreign Direct Investment FDIs, and  emphasised on the African regions that promote those factors. The interview then covered how to best enter the African market. Mr Zander recommended a detailed study of the market in order to enter with best fit African Market Entry strategy.

For the full interview please use the link below to gain more insights about investors lack of information in Africa: Interview https://www.ct-executive.de/download-file?file_id=472&file_code=de37e6d523

Business in Africa 2.0 – IHK Saarland

After the success of the first event, IHK Saarland has invited africon GmbH for the 2nd time to the topic Africa. This time the theme of the event was “Business in Africa 2.0” to which companies from Saarland were invited.Mr. Zander, Partner and CEO of africon GmbH was invited as a speaker and presented concrete opportunities in Africa and recommendations for German SMEs on market entry of Africa Strategy. In the later exchange with the participants questions were discussed how to find the right partner in Africa, which countries have the greatest potential and how should a medium-sized company plan its Africa Strategy.

Marc Zander
africon present

Successful Plastic Sector Projects Done in East & West Africa

In the past months africon conducted two market assessment projects and one very successful business trip to Kenya for major international players of the plastic packaging sector.

Promising future market in Nigeria

The two market assessment projects had Nigeria as their focus market and more than 100 interviews were conducted with all relevant players of the plastic packaging sector locally.
The results concluded from the analysis of all interviews and market data in Nigeria is very clear: the plastic (packaging) sector in Nigeria is very vivid and growing at a high pace. Nevertheless, the Nigerian market is highly cost conscious. Competition is set on pricing strategy: the cheaper the product, the more sales a company makes. Most manufacturers still shy away from cost increases even marginally. The majority of consumers do not care much about quality as they do have an open eye for the cost.

At the same time the future is certain to come with changes. The upper middle class is expanding and there’s a growing awareness on quality products among Nigerian consumers generally.Any high quality / high price level company entering the Nigerian market will need a targeted product awareness campaign to help realize the market potential for their products. Both end users and converters need some form of education on the use of the products.

Modest expectations in Kenya

For Kenya, which has only a quarter of the population that Nigeria has and which’s BIP is 5 times smaller, the picture looks a bit different. The local production of BOPP film is for example not meeting its expectation in terms of capacity as it stands at around 30,0000 tons per year in Nigeria. Also, the import of machinery to manufacture plastic film stands at $ 87m in Nigeria but only at $ 38m in Kenya. But with the growing food manufacturing sector in both countries it is expected for the plastic packaging industry to grow as well. Since importing ready-made plastic film comes definitely more costly at one point than local production.

For any questions regarding this project please feel free to contact our practice leader Ms Lena Schwoerer.

BRS Market Attractiveness Index for SME in Africa

Over the past decades, Africa has started its way to become a major emerging market. For companies from Africa and all over the world, this creates substantial opportunities. Unfortunately, the German “Mittelstand”, the backbone of its economy and proud ambassadors of the “Made in Germany” logo all around the world, still lacks behind with its engagement on the continent. Just over 1.000 companies from Germany are active in Africa. Reasons are manifold, but one is especially widespread and within our abilities to tackle: the difficulty of German “Mittelstand” firms to develop a structured approach to market entry strategies into Africa.

As many of these firms have never done business on the continent, questions such as “Where should we start?”, “Which countries do we need to consider?”, “What are the opportunities and risks of certain countries?” are key hurdles at an early stage of the market entry. To alleviate this challenge, BRS Institute of Bonn-Rhein-Sieg University of Applied Sciences, together with africon GmbH have decided to develop a country index designed specifically tailored to the unique requirements of “Mittelstand” firms. The index, named the “BRS Market Attractiveness Index SME Africa”, gives companies a comprehensive overview on African markets on various levels of detail to create awareness of opportunities, risks and potential starting points for a market entry. It thereby provides a vital starting point, from which a structured market entry strategy can be developed.

If this index interests you, come and join us at this year´s conferenceUniversities, Entrepreneurship and Enterprise Development in Africa” in Sankt Augustin, Germany, on from 13th to 14th September. Apart from a formal signing ceremony and the welcoming of further exciting project partners to the index team, the event will feature a speech on the African FMCG markets by africon CEO Marc Zander, as well as a range of other interesting agenda points.

We look forward to meeting you!

africon consulting

Investors Challenge and Interest in Africa

africon business analyst Mr. Al-Salafi has collaborated with The African Development & Investment Convention (ADIC) Mr. Mamora to produce an article about Investments and obstacles in Africa.

To read the article please visit the following link: Article 
https://adic.afidep.com/news-blog/366-investors-challenge-and-interest-in-africa.html