Africa’s local dynamos: Five companies changing the rules of business
Boston Consulting Group
(BCG) recently identified 50 emerging market companies that are winning
customers with targeted and customised business models. These “local
dynamos” are competing on innovation, rather than traditional sources of
advantage.
Although these companies might not yet be global players, they are
thriving at home. According to BCG, multinationals ignore these dynamos
at their peril.
Five companies from sub-Saharan Africa were included in the list. How we made it in Africa takes a brief look at each of them.
Equity Bank (Kenya)
Equity Bank is a Kenyan-based banking
group with operations across East Africa. Under the leadership of CEO
James Mwangi, Equity was turned around from a technically insolvent
building society in 1993, to a leading commercial bank.
Part of Equity’s success is due to its innovative ways of reaching rural customers, a group previously seen as unbankable.
Instead of expanding into the rural areas through costly bricks and
mortar branches, Equity works through independent agents to deliver
financial services. These agents operate under contract to Equity and
are trained to offer basic banking services to customers.
Agents rely on smartphones to accept applications for new accounts.
Applicant data is loaded onto the phone, while photos are taken of the
applicant and supporting documents. Once signed up, customers can
perform basic transactions through Equity’s mobile banking service.
Discovery Health (South Africa)
South Africa’s largest private health insurance company Discovery
brought innovation to the sector by rewarding clients for healthy
living. Through Discovery’s Vitality rewards programme, members get
discounted gym membership and pay less for health food and other
products from selected retailers. Members also qualify for discounts on
everything from flights to movie tickets.
The company reportedly says the Vitality scheme pays for itself through fewer illnesses and hospital stays.
“What makes Discovery so intriguing is that it changed the rules of health insurance,” notes BCG.
GTBank (Nigeria)
Nigeria’s GTBank, one of the country’s biggest lenders, boosted its
operations by leveraging internet and mobile technologies. Through its
mobile money application clients can transfer funds, pay for goods and
services, and withdraw money from teller machines without a card.
GTBank is also successfully tapping into social media, with over 2m
Facebook likes and more than 145,000 Twitter followers. Last year it
launched a social banking service that allows the public to open new
accounts and get customer service support on Facebook. This was the
first service of its kind in Nigeria.
According to BCG, GTBank is an example of a company that converted
the constraints of the local economy into a profitable opportunity.
Zambeef (Zambia)
Zambeef is a Zambian integrated agribusiness company
involved in the production, processing, distribution and retailing of
beef, pork, chicken, eggs, milk, dairy products, edible oils, flour and
bread throughout Zambia and in West Africa. The company operates its own retail and fast food outlets, while also managing pan-African supermarket chain Shoprite’s butcheries in Zambia, Nigeria and Ghana.
Expanding its operations in West Africa is a high priority for Zambeef. It has established processing plants in both Nigeria and Ghana, and plans to grow its retail footprint, both through its own stores and in association with Shoprite.
Woolworths (South Africa)
Woolworths is a South African-based clothing and food retailer that
predominantly sells its own in-house (or private label) brands.
The company has expanded into the rest of the continent, and
currently has a presence in 12 African countries. However, last year Woolworths pulled out of its three stores in Nigeria, citing high rental costs, duties and supply chain challenges.
Woolworths also sources clothing and agricultural produce from other
African countries. For example, 10% of its clothing comes from Mauritius and Madagascar. In Tanzania, the company has partnered with a group of farmers on the slopes of Mount Kilimanjaro to grow organic coffee.
Woolworths recently increased its footprint in the Australian market
when it bought department store David Jones. It also owns Australian
clothing retailer Country Road.
Source: http://www.howwemadeitinafrica.com/africas-local-dynamos-five-companies-changing-the-rules-of-business/41981/
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