2016 was a tough year for many African businesses, we saw an increase in labor costs, weakening currencies and rising inflation across the continent making it hard for SME’s to borrow money due to high interest rates.
The macroeconomics is gloomy and in times like these, African businesses should take the opportunity to examine their microenvironment to weed out inefficiencies and find innovative ways to generate more revenue. To achieve this, here are three things African businesses should do in 2017
1.Build a prospect customer database
This sounds basic but most small and medium size businesses in Africa do not have or maintain a prospect customer database; how will your business expand? A prospects database provides your business with many opportunities to optimize your sales relationships and success through the creation of a sales pipeline.
A sales pipeline will help you to know whether you have enough deals on board to achieve your business goals as well as understanding whether certain deals need special attention. Here are three ways you can build your own prospect database:
- Cold calling is the traditional way to create a prospects database, get a list of customer targets call them with a well-prepared pitch to sell your product and collect data. Ask for key questions such as: who is the key decision maker, and what is your budget?
- Join prominent community organizations such as chambers of commerce, conventions, charitable groups. Participate in community events you can reach your target market.
- Provide registration cards at events and conduct periodic surveys.
2. Digitize your business
Many African businesses store critical data in books, photocopied paper stacked away in big filing cabinets whereby it is hard to access. Moreover, it is risky, in case of a fire, you might lose your business for good. The cost of storing data in file cabinets is huge; office space that could be used for value adding activities is instead used to store dormant data and expenses spent on security equipment such as CCTV cameras to safeguard this data are considerable.
With digitization, all paper data can be transformed into a digital copy that will make your business documents 24/7 via the internet or local storage and it will simplify the data query process. Furthermore, digitization offers better document security and your business will save space which will save your business money in the long term.
3.Invest and build business systems
Without systems, you are the business. This means if you want to double your revenue, you need to double your hours of work. Since you have finite hours in a day, they limit how fast and big your business can grow. Don’t wait until your business is in crisis mode and spanning out of control to start building business systems. It is much easier to begin building your systems from the start than when your business is in crisis, and if your business is in disarray or close to it, then now is the time to change that. Business systems start with documenting processes and procedures that allow your business to run without you.
This can be achieved by developing operation manuals consisting of everything, from hiring to product delivery. This will allow your business to scale whereby you can replicate your enterprise in other geographical areas. Additionally, documenting all your processes will provide insights revealing tasks to automate and improve.
For the most part, if African businesses implement any one of these initiatives, 2017 will be more profitable than 2016. Across the world digitization, building systems and building databases have created innovative and competitive businesses.