Samsung outlines African expansion

BUSINESS

Samsung Electronics says it is going African “ in a big way” , having identified the continent as a key node of explosive growth.

George Ferreira, Samsung’ s Chief Operations Officer for Sub-Saharan Africa, said in a statement:  “ Africa’ s time is now. In real terms, the continent’ s potential is staggering. 15% of the world’ s entire population lives on this vast continent, but it only produces 2.6% of global GDP. It would need to enlarge its combined GDP 5 or 6 times to even come close to competing with the rest of the globe. In our view, that’ s an enormous opportunity to do business and grow our market share on the continent. Quite simply an unmissable opportunity.”

Samsung has identified the continent’ s top 10 economies, which together generate 79% of Africa’ s wealth and house almost 47% of the population. Key focus countries will be those with large and growing populations such as South Africa, Nigeria, Kenya and Sudan.

  “ Our business model, although global in nature, is tailored to suit each individual market we enter, and our African strategy caters specifically for African market requirements. In Africa refrigerator demand is for large capacity models in comparison to, for example, our European customers. It is really about customising the product lineup for each market,” Ferreira says.

Ferreira says there are some challenges in penetrating Africa, not least of which are counterfeit, or gray products, infiltrating the market, specifically in the mobile phones space. The company is attempting to minimize and eradicate parallel importation through the use of e-warranty, which is the registration of serial numbers by end consumers prior to purchase. Initial data on the success of this initiative looks promising.