Africa is a fast-growing continent, and many foreign investors recognize that there is enough money to be earned there.
There are many untapped opportunities in Africa that many investors and companies are unaware of despite the developing economy of the continent.
This is not to say that Africa has not evolved, as there are several countries that have undergone economic reforms and are one of the best places to invest when compared to other countries in other regions of the world, especially because the returns can be much higher than those found in the developed world.
Data has it that African nations produced a 14 percent yearly return on investment, with Africa home to nine of the world’s fifteen fastest growing economies.
The African continent is not only rich in agriculture, but also in people and natural resources, and as the world’s population grows, these resources will become more important.
17 Untapped Business Opportunities in Africa
Here are 17 innovative and untapped business opportunities in Africa:
1. Data storage & cybersecurity
Every year, cybersecurity breaches cost African companies more than $3.5 billion. Because of the potential damages and losses at stake, cybersecurity is quickly becoming one of Africa’s most important emerging business opportunities.
Individuals and organizations of all sizes are under attack. From basic email scams to large-scale data theft, fraud, ransomware, espionage, critical infrastructure sabotage, and other harmful actions, the assaults vary from simple to complex.
According to the Africa Centre for Strategic Studies, up to 96% of cybersecurity events in Africa go unreported or unsolved, implying that cyber dangers on the continent are likely far greater than government figures indicate.
2. Internet access and communication technology
The internet market in Africa is worth billions of dollars. It comes as no surprise that digital behemoths like Google and Facebook are working hard to enhance internet access for millions of Africans.
However, some astute African entrepreneurs are already making significant inroads into the internet access industry. One example is ‘BRCK,’ a Kenyan business that has developed a rugged internet modem device intended for tough settings with limited internet access and power.
The modem can switch between Ethernet, WiFi, 3G, and 4G networks and has an eight-hour battery life.
3. Off-grid solar installation and power supply
The enormous potential for off-grid solar solutions makes solar one of the most appealing business opportunities in Africa right now.
And there is a lot of demand.
Over 600 million Africans are fed up with waiting for electricity from centrally controlled power networks that are sluggish to install, inefficient, and unresponsive to the continent’s increasing power demands.
And, in a continent with over 300 days of sunshine in many areas, it’s difficult to match the value proposition of a device that bypasses the central power system and fulfills your energy requirements by tapping directly into the sun, a free energy source.
As a result, the African solar industry has expanded, and the number of companies in this sector continues to increase. This will undoubtedly be an interesting sector to follow as more money and companies compete to meet Africa’s huge need for off-grid solar solutions.
4. Agriculture and agribusiness
Africa is an excellent place to start an agricultural business because of its favorable environment and enough rainfall. Africa is well-known for its agricultural exports such as cocoa, coffee, and tea. As a result, agriculture is obviously one of Africa’s untapped business opportunities.
You may engage in chicken farming and either export or sell the eggs locally. You may also buy dairy or meat cattle. Having a milk processing plant will be advantageous since you will be able to process value-added dairy products such as yoghurt and cheese. Fish farming is also a profitable business venture in Africa.
Agriculture has a ready market, and Africa’s climate is favorable. This business is appropriate for nations with a favorable agricultural environment, such as Uganda, Tanzania, Ethiopia, Zambia, and Tunisia.
6. E-commerce business opportunity
In the e-commerce sector, there is still plenty of opportunity for new ideas and niches. Despite the fact that e-commerce behemoths like Amazon and eBay seemed to have the whole industry in their clutches at the time. Shopify created a new kind of E-commerce business that was a tremendous success.
Read Also: Inspiring Startup Stories of 6 African Entrepreneurs We Interviewed
E-commerce is one of the most lucrative companies in the world today since many people like to shop from the comfort of their own homes. Create a one-of-a-kind concept, such as Shopify, and you can be certain that international investors will be eager to collaborate with you.
7. The green revolution
Green and eco-friendly goods and services are becoming more popular throughout the globe. Because of the challenges posed by climate change, every solution that protects the natural environment, minimizes waste and pollution, and encourages reuse and recycling has become a major business opportunity.
Several African entrepreneurs and companies are already capitalizing on this potential and enjoying tremendous success. Another increasing potential in Africa is the generation of biogas from organic waste.
8. Low-cost private schools
The quality of education in public schools in Africa is rapidly deteriorating. This is due to corruption, a lack of knowledge, inadequate budget, and a rise in population.
As a consequence, most African parents choose private schools to guarantee their children get a superior education.
Establishing a private school is one of the business ideas in Africa that some entrepreneurs have already implemented, and they are seeing a decent return on their investment.
Many African nations were not able to achieve the Millennium Development Goal (MDG) of universal primary school enrollment by 2015.
Even after years of adopting the Sustainable Development Goal 4, there has been little progress in decreasing the worldwide population of out-of-school children (SDG 4).
According to the UNESCO Institute for Statistics, overall primary enrolment in Sub-Saharan Africa was about 101 million pupils, with the private sector accounting for 10% (or almost 10 million kids).
9. Payment alternatives
Over $100 billion in transactions are still conducted in cash in Africa each year. For astute businesses, this represents a massive and profitable financial services potential.
Since its introduction in Nieria, Paystack has proven to be a remarkable business payment service in Nieria Ghana, Kenya, and South Africa, where the platform processes over 100 million business transactions each year.
There is a tremendous rush in other areas of Africa for Africa’s next major money transfer and payment business.
Several potential companies are vying for dominance in Nigeria, Africa’s largest economy like Paga. Payment solutions will be an important topic to monitor in the future years.
10. Outsourcing
Business Process Outsourcing (BPO) is currently a multibillion-dollar multinational industry.
The growing dominance of e-commerce and the digital economy is driving a need for greater data, real-time services, and a presence across various platforms among businesses.
As a consequence, more businesses are outsourcing their accounting, data processing, customer service, human resources, and supply chain requirements.
While India and the Philippines have benefited from the surge in IT outsourcing demand in the United States and the United Kingdom, Africa has emerged as a major participant in BPO for the worldwide Francophone market.
11. Urban logistics
Africans are increasingly migrating to cities and metropolitan regions. Africa is presently the world’s fastest urbanizing region, with up to 1 billion people expected to live in urban settings by 2050.
By 2030, Africa will have 17 cities with populations of more than five million people, as well as 90 cities with populations of at least one million. The UN predicts that by 2050, the continent would have 14 megacities.
While large cities provide enormous economic opportunities, they also pose major logistical difficulties in terms of finding people and providing products and services.
A prominent example is the absence of a formal address system in many of the continent’s metropolitan regions.
Doing business in certain areas of Africa may be very difficult without precise and confirmed addresses. Identity verification, fulfilling customer orders, and monitoring location data pose major difficulties for e-commerce firms, banks, energy providers, and a variety of local businesses.
Another major logistical headache is last-mile delivery of products.
As the population of Africa’s metropolitan centers increases, it places a significant pressure on the country’s inadequate transportation infrastructure, making it harder to transfer products.
Road traffic in most African major cities is already a nightmare – and it’s only going to get worse.
The good news is that throughout Africa, a rising number of companies are attempting to address urban last-mile delivery issues by combining technology with a network of agents on motorbikes, automobiles, and trucks.
12. Real estate
Real estate is one of Africa’s top business ideas. In Africa, the demand for property near cities and small towns is tremendous. The most sought-after investment is land ownership. It is also the top priority for new hires.
Purchasing a big plot of property and then subdividing it into tiny pieces for selling can provide enormous profits. This may be a profitable concept with a high probability of success. Again, land does not depreciate while demand rises every day.
13. Affordable housing
Shelter is critical for human survival, but many Africans cannot afford the exorbitant costs of housing, particularly in urban areas.
Affordable housing, such as trailer homes, tiny houses, or houses built with non-traditional building materials, can go a long way toward alleviating housing shortages in African cities.
This kind of business, which addresses life-threatening problems, is easily able to attract international investment or grants.
14. Low-cost healthcare
Africa is confronting a major health-care crisis. Public hospitals are underfunded, and the majority of physicians from the continent relocate to other developed continents.
Strong economic development in recent years has contributed to the reduction of poverty in Africa to more than 43 percent of the population.
As Africa’s population grows, it will reach 2.5 billion by 2050. The area is facing a crucial challenge: laying the groundwork for long-term inclusive development. Many African nations continue to face high rates of infant and maternal mortality.
Malnutrition is much too prevalent, and most health-care systems are ill-equipped to cope with outbreaks and the increasing load of chronic illnesses such as diabetes.
As a result, Africa’s health-care facilities are in disrepair. With Africa’s fast increasing population and substantial illness cases, entrepreneurs have a chance to offer cheap health care to Africans.
15. Fashion and beauty
The African fashion and cosmetics industry is expanding at a rapid pace. The continent’s youthful population offers a ready market for fashionable clothes.
Across Africa’s rapidly expanding metropolitan regions, various types of clothes, including locally-made textiles and imported designer brands, have become hot-selling items.
Hundreds of emerging stars in Africa are establishing profitable companies in the fashion and cosmetics industries.
16. Tourism and hospitality
Africa’s wide life, natural beauty, and diverse culture attract millions of tourists every year.
This means there are opportunities in hospitality businesses, which means you can start a boutique hotel, eco-lodge, etc.
Or, better still you can become a tour guide and offer unique experiences tailored to tourists’ interests.
17. Human capital development
South Africa faces an education gap and a need for improving skills to meet the demands of a rapidly evolving job market.
By providing training programs, vocational courses, or online learning platforms, you can contribute to human capital development.
Bridging this gap and helping individuals acquire new skills and qualifications can be a rewarding and profitable venture.
4 Things To Do When Exploring Untapped Business Opportunities in Africa
When considering business opportunities, it’s essential to explore specific regions or industries that align with your interests and expertise.
Here are the things you should do:
1. Market research and analysis
Before diving into any business venture, conducting thorough market research is crucial.Understand the demand, competition, target audience, and consumer behavior in the African market.
Identify gaps and untapped niches that present opportunities for growth. Leveraging market research tools and techniques can help you make informed decisions and increase your chances of success.
2. Networking and collaborations
Building a strong network and establishing collaborations can be valuable when exploring business opportunities in Africa.
Attend industry conferences, join professional associations, or engage in local business communities to expand your connections.
Also, collaborating with local partners, suppliers, or distributors can provide insights into the market, help navigate regulations, and foster mutually beneficial relationships.
3. Government support and incentives
Many African governments actively support and encourage business development. So stay updated on government programs, grants, and incentives that can benefit your business.
These initiatives may include tax incentives, financial assistance, mentorship programs, or access to specialized resources.
By taking advantage of these opportunities, you can accelerate your business growth and maximize your chances of success.
4. Technology and digital transformation
Embracing technology and digital transformation is vital for businesses in this era. Invest in website design, establish a strong online presence, and leverage digital marketing strategies to reach a wider audience.
Today Africa provides services to enhance your online visibility and customer engagement. Click here and check out the services that we offer to businesses.
References:
- Sabo News
