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Into Africa

Sep 12, 2012
Moving In Africa. By Val Prinsep of Worldwide Movers Africa.
The past 20 years has seen an astonishing transformation taking place in Africa. There’s been a silent and relatively peaceful rejection of the autocrats who ruled with a nasty cocktail of nepotism, corruption and fear.  And the party is nearly over for the remaining despots who will soon be vanquished by time rather than revolt.



With these dramatic political changes have come new players in the relocation business, companies that have forged their own business models, specific to local demands. These are the global and African players such as AGS and Worldwide Movers Africa with multi-branches, energy, stamina and local know-how to keep their businesses flourishing. 

Three different business models serve the African relocation industry.  One is where each multi-country operation is driven by local and overseas stakeholders. Here, a company director manages the business which assures continuity, fosters increased local knowledge and contacts and eliminates corruption.  Another is where the maximum shareholding is external, management is rotated every two or three years and growth is supported and supplemented by inter-company moves. The third model is the smaller, local companies who compete with lower pricing and in some cases forego payment of VAT/GST/TVA sales taxes crossing fingers to snag a kindly tax auditor when the time comes.  Some of these companies are well established and not all skip their fiscal dues, but with single operations they can find it hard to complete with the multi-branch players. 

Africa’s relocation industry can be divided into three very different slices: ‘the Maghreb’ or North Africa, ‘sub-Saharan Africa’ (or those north of the Limpopo), and of course, South Africa.  

North Africa

Egypt, the Muslim world’s political and theological crucible, marches to its own drummer and is where longer established moving companies have thrived on their reputation for reliability and creditworthiness in a world of uncertainty. Libya presently entices only oil industry and embassy moves but will soon be an irresistible target for the ‘intrepids’.  Their francophone neighbours to the west have had close ties with French movers, some of whom have branches there to service the trans-Mediterranean traffic, but the ties are weakening and local companies are flexing their marketing wings to independently secure their share of worldwide traffic.

South Africa

Let’s now fly way south. South Africa’s relocation industry is big, enormous compared with any other African nation, certainly highly developed, sophisticated even, with a rich history of quality and reliability. Although it dwarfs its neighbours to the north, it’s really considered to be, well, not very African. South Africa’s infrastructure, communications and legal system functions almost flawlessly, materials and services are plentiful and the offices, equipment and warehouses of our colleagues there are similar to ones you might find in Evansville, Indiana.  Bewildering as they may be, the multitude of movers and storers have generated a few strong and dominant companies that to date have kept the smaller operators at bay. As South African industry sinks its money into new businesses north of the Limpopo, movers north and south of the river prosper.

Sub-Saharan Africa

More mature movers will vividly recollect the blank expressions of co-workers when told to find a ‘reliable’ destination agent in central Africa: of 49 countries in this region, only a handful had anything but a vague idea of what an international move was. It was mostly the import/export houses that offered ‘home-bound packing and shipping services’. Sixteen years ago I became chairman of Worldwide Movers Africa.  I remember a US Ambassador poking around a dusty liquor store in Dar es Salaam, Tanzania, looking for cardboard cartons for his move back home. What an opportunity and how things have changed for the better. The leading relocation companies in this region manage to successfully train packers and drivers with revolving training classes, import quality packing materials and certainly the enquiry response times can shame some of the move-divas of this world. Some company directors are doyens of our industry having graduated from north American and European relocation companies, but that was long, long ago. 

The Bureau d’Echange phenomenon has done as much to revolutionise the industry as anything else. In nearly all central and western African countries where foreign exchange has been liberalised, these exchange parlours cater to folks brandishing whopping great wads of local cash that is changed into crisp new dollar notes at the blink of an eyelid. It’s not uncommon to hear South African accents in bars and restaurants across the continent. SA breweries, supermarket chains and fast food outlets are flattening the local competition. After all, it’s twice as gratifying when you can now buy dollars and repatriate most of your profits. Now that’s a worthwhile facilitation.

Even so, in sub-Saharan Africa, the modus operandi is entirely different, tailor-made for a very tough environment where the challenges of occasional unrest, degraded infrastructure and communications are commonplace. Power outages can be long and frequent, e-mail connection tenuous and monster traffic jams ubiquitous.  Up to two-month delays to retrieve a container from ports are commonplace.  

The rush by a couple of South African movers to establish branches north of the Limpopo has not been successful: entirely different skill-sets are needed with business models that suitably conform to a myriad of local challenges: logistic, linguistic, fiscal and political.  So relationships between movers north and south of the Limpopo, although independent, are strengthening through increasing reciprocal tonnage and cooperation.           

Change is constant and swift in this part of the continent. The Worldwide Movers Africa group is fast moving towards greater local autonomy, that’s to say an increasingly Africanised management and a financial architecture that benefits nationals through profit sharing and bonuses. In addition, government tender awards (as in South Africa) will be biased towards companies with more local shareholding. 

In West Africa and the Sahel, it’s Nigeria that dominates with hydrocarbon and other industries served by mostly local moving companies. This is a really rugged environment in which to operate where patience and a sense of humour are prerequisites for shippers and relocators. Ghana, stable and safe, is generating mining and agricultural investment interest in the region, alas to the detriment of Ivory Coast and other occidental states that from time to time are handicapped by political disruptions and unrest. Central Africa’s Democratic Republic of Congo, huge and shambolic, is where transport infrastructure is virtually defunct so any household moves mostly emanate from the capital, Kinshasa and Lubumbashi close to Zambia. 

In east Africa it’s Kenya, Uganda and Tanzania that enjoy the spotlight with sustained growth nourished with plentiful natural resources, mineral and hydrocarbons soon to come on line. Tanzania in particular, blessed with political stability, natural gas reserves larger than Qatar’s, is the new ‘ripe-for-investment’ star of the region but like its neighbours continues to suffer power outages, Internet interruptions and unforeseen monetary demands that can hinder smooth business operations.  

The ‘tiny countries such as Togo, Benin, Malawi, Rwanda and Burundi pose special challenges for local movers: when a couple of the big multi-branch movers are face-to-face in town, it’s like a stand-off, both responding to the same multiple quote requests from several overseas colleagues. Take Antananarivo in Madagascar as another example. AGS and Worldwide Movers Africa (both having more operations than any other movers on the continent), face off in the battle for every corporate and diplomatic move, both armed with arsenals of quality staff and materials. 

Ethiopia bans any international investment in the transport sector. Both AGS and Worldwide Movers Africa have tried, unsuccessfully, to offer services in Addis Ababa, home to the new monster African Union headquarters, a glitzy gift from China.  Gratifyingly one or two local moving companies in Addis boast new overseas-trained management so the industry no longer has to endure the lethargy and disinterest of old. For those brave-of-heart relocation companies with the acumen and local knowledge, Eritrea, newly formed South Sudan, Somalia (and even Somaliland) provide opportunities with Worldwide Movers Africa offering services in Mogadishu where you can now promenade the streets in ‘relative safety’. Even safer if your relative’s a warlord.

Zambia and Zimbabwe, although neighbours, have witnessed very different economic states.  Zambia enjoys relative political stability and boasts increasing South African investment whereas stagnation, and fear of confiscation of businesses, leave Zimbabwean companies awaiting the inevitable and imminent new leadership that may foster a more clement investment climate. If not, those moving vans will be parked a while longer.

And where on earth is Angola?  Little known and seriously rich with black gold gushing from monster off-shore rigs, Portuguese speaking Luanda is the most expensive city in the world with rents that make London’s moguls blanch. The city tries to accommodate the oil industry staff in this overcrowded city so any relocation company with deep pockets and staying power surely enjoys jaw-dropping margins and adult-strength headaches.  The only international relocation company there today is AGS-Frasers, but not for long, with the Worldwide Movers Africa group expanding its network operations at regular intervals.

The emergence of new business opportunities across the continent means more reliable relocation companies across the board, good for the shipper, but not so good for a few of those jaw-dropping monopolistic margins.

   

Left photo; Alexandra Beuthin and Lydia Kunihira of WWMAF, Kampala, Uganda.

Val Prinsep

With an MA in Art History, Val left university to start the first commercial trans-Africa expedition company. He joined North American Van Lines in Beirut during the Lebanon war becoming manager for all of Africa and Middle East: then started Baillargeon Int'l (Canada) and a partnership moving company in Toronto. In 1996 Val created Worldwide Movers Africa in Tanzania and has grown the company into 12 African countries. He is chairman of the WWMAF Group.

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