Image Source: US-Africa Relations Update
The 2nd edition of the US-African business forum held during the 71st UN general assembly in New-York, has revealed some important information that every small and medium scale entrepreneur should leverage on. The forum is a gathering of political and business leaders around the world to deliberate on the business potential in Africa and build mutually beneficial business relationships for all parties involved. Entrepreneurs can shape their business ideas with the outcome of the US-African business forum.
The discovery of shale oil, a substitute for crude-oil and the global fall in oil prices has reduced the demand for African Crude oil by the United States. This has immensely affected foreign earnings and there is the need for Africa to export other raw materials besides oil. African countries are now focused on exporting agricultural produce including cow peas, cocoa, cashew nuts, cassava, ginger, sesame, oil palm, fruits, cotton and many more, as sources of foreign exchange earnings. However, there is a growing concern about the quality control of exported African produce, which has led to exportation ban of some agricultural produce in African countries to the United States and the European Union. “Agro-preneurs” must source for effective ways to maximize their produce with the aim of targeting local and international markets, for foreign exchange earnings which can be re-invested to acquire equipment needed to improve yield and the quality of crops.
The evolution of smart phones has removed barriers in accessing the internet and increasing knowledge. Nigeria, for example currently has 150 million active mobile phone lines in the country; of which 60% (approx. 90 million) are connected to the Internet. Small and medium scale enterprises must establish online presence and advertise their products or services on the internet to reach a wide target market.
Africa entrepreneurs must also learn how to position their businesses to attract foreign direct investments. Digital footprints, strong record keeping and business profitability are strong factors that will attract these investments. Many small business owners dream of establishing global brands; however, this may never happen if a problem isn’t being solved. On the other hand, access to foreign investment reduces the decision-making power of the founder. It is important to avoid undervaluing your business as a result of financial constraints. Rather, consider the innovative depth of your idea and investment time before valuation. Do not sell your company for a cheap morsel of bread.
In the 21st century, mutually beneficial partnerships is becoming a trend. Local producers can exchange raw produce for finished products from international counterparts. For example, a cocoa farmer in Ghana can exchange his raw material to become a sole distributor of the finished product in the country, or even convince his counterpart into establishing a presence locally. Many big companies are already involved in trade by barter; and small businesses can also scale up from mutually beneficial partnerships.
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