Why it’s exciting to be doing business in Africa

“There is always something new out of Africa,” the ancient Greeks used to say. Back then, the proverb referred to the continent’s extraordinary diversity, but today it can be applied to the accelerating pace of change as Africa begins to reshape its economic destiny.

Africa is a youthful continent, experiencing the most rapid urbanisation rate in the world and, by 2034, it is expected to boast a larger working-age population than either China or India.

Accelerating technological change and rapid adoption of mobile telephony are helping to unlock new opportunities for consumers and businesses, while governments are increasingly conscious of the legislative and policy levers that must be activated to accelerate economic development.

Kenya’s Big 4 agenda of manufacturing, universal healthcare, affordable housing and food security, unveiled by President Uhuru Kenyatta in December, is a timely recognition that human and economic development go hand in hand, each enabling the other.

Agility and innovation

For a business to compete in this environment demands agility and relentless innovation - to deliver new products that meet the evolving expectations of consumers, new skills to meet the challenges of the fourth industrial revolution, new processes to adapt to new technology and the fast-changing operating environment, and, in the case of Coca-Cola Beverages Africa (CCBA), also new packaging solutions that respond to environmental concerns and the preferences of consumers. 

From a product portfolio point of view, CCBA has 508 different products in the nine African markets where CCBA’s International Division operates - Kenya, Uganda, Ethiopia, Tanzania, Mozambique, Namibia and Ghana as well as the islands of Comoros and Mayotte. That is 65 percent more than we had last year. Some of them are old favourites, Coca-Cola itself first and foremost, but many are new, like our hydration range of energy drinks and water, our teas and coffees, our nutrition juice and even value-added dairy drinks.

Our aim, together with The Coca-Cola Company, is to become a total beverage company, and in this context we are continuously bringing new products to the market in response to changing consumer preferences.

Fundamental to our innovation is increased investment and local sourcing of raw products. As an example, in Kenya, we are already sourcing local fruit pulp for the manufacture of Minute Maid Mango.

We continue to invest across all our markets in products that respond to changing consumer tastes and preferences, as we seek to increasingly draw on local inputs as part of our commitment to source locally some of the ingredients we currently import. We have an ambitious target to substantially increase our local sourcing by 2022.

This is reflective of our belief that the growth of our business is directly linked to the development of the African economy. 

As we invest in local production capacity, we also invest in our people, building the skills of our workforce to meet not only the requirements of our business, but the broader economy too, thus enhancing the productivity and growth potential of the continent itself.

Before we put in a new line of products, our employees spend several months in the manufacturer’s facility in the country of origin, fine-tuning the skills needed to bring those products to market to the high quality standards we set.

Some of this involves reducing sugar in our drinks, giving consumers options of diet, light or even zero-sugar drinks. It also involves introducing new packaging which reduces portions as we combine scientific research with the changing tastes and dietary preferences of our consumers.

Innovation takes courage and when we succeed, everyone succeeds. In Ethiopia, we built a factory in a location where there was no other development, but once other companies saw what we had done, they started looking for investment opportunities themselves. Today, the plant is run by local employees, all of whom are under the age of 30.

Along with the many opportunities on offer, Africa presents unique challenges. In the vast, yet sparsely populated Namibia, we had to completely revamp our coastal route to market to ensure our products were always available and perfectly chilled.

Many of our partner businesses– especially the retailers – now employ other people, having benefited from the many mentorship and small business programmes we run. We are determined to turn survivalist businesses into sustainable, growing businesses.

It is part of our sustainability strategy that the growth of our business should be underpinned by growth of the communities who buy our products.

We share the aspirations of Africans and their governments: that there should be the dignity of work for all, decent health care, housing and food security. We want to help build a better Africa, and we have the will and the imagination to help make this happen.

Mr Vermeulen is managing director of Coca Cola Beverages Africa International Division