By Jennigay Coetzer – Business Day, 30 January, 2012

Many South African courier companies are extending their reach into Africa, and see it as a major potential growth area. Tim Steel, MD for South Africa at TNT Express, says global customers are eyeing Africa as an attractive emerging market, with enquiries coming in every week.

“We are currently consulting with our Chinese customers as to how best to supply their goods into Africa.” He says one of the challenges is that Africa is made up of 55 countries that all have different ways of doing things.

So it is imperative to have an efficient supply chain into Africa, with the ability to ensure shipments move smoothly through borders. Steel says TNT has created an express cross border road network across southern Africa.

He says there is a move afoot in Africa to link key clusters of countries. “The east African community is moving to open borders to allow movement of goods between countries without customs clearance.”

He says this includes countries like Kenya, Tanzania, Uganda, Rwanda, Burundi, and Ethiopia. Graeme Lazarus, Joint MD of RAM Hand-to-Hand Couriers says there is a growing demand for courier services to other parts of Africa.

However, it is no good venturing into these markets without understanding them and being sure of generating sufficient volumes to ensure viability. Lazarus says international courier companies have the advantage of being able to push volumes of business into Africa through their global customer base and international affiliations.

He says RAM has been operating in African markets like Botswana, Namibia, Angola, Lesotho and Swaziland for about five years. Berco Express is currently delivering to most southern African countries by road or airfreight, and has recently been extending its reach further up into Nigeria and Ghana, says MD Andy van der Velde.

The company has recently been acquired by global logistics company Aramex, which has a presence in 14 countries in Africa, although not in the southern regions. “Berco has been doing business in southern Africa for 10 years, and we will now be expanding our operations into other parts of the continent through Aramex,” says van der Velde.

Ken Light, executive head for SkyNet, says the growing economic interest in Africa is creating potential for setting up domestic networks across the continent, as has already happened in SA. He says with the economic issues in the US and UK, Africa is being viewed as the next big frontier for trading, after India and China.

This is apparent from the interest being shown by major overseas and SA retail chains like Walmart-controlled Massmart to expand into Africa. “Courier companies can follow the retailers and suppliers that are moving up there,” says Light.

He says Skynet is planning to establish domestic courier networks in other parts of Africa at the rate of one a year, and has already done so in Mozambique, Botswana, Namibia, and Swaziland. Dawn Wing CEO Eddie Vosloo says the company has put in place the African Distribution Alliance (ADA) network, through which members have access to one another’s distribution networks across Africa, with agreed service levels and the ability to have access to a worldwide network.

He says there has been a recent decline in the demand for courier deliveries into Africa through SA. This is partly because coastal African countries have upgraded their harbours to handle the movement of goods by sea, and the inland roads have been improved.

For example, there is now a highway across Namibia to Botswana, and another from Mozambique to Zimbabwe, says Vosloo. “It reduces the cost of shipping by not coming through SA.”

He says Durban is the most expensive port in the world to bring in shipments, and neighbouring countries are taking advantage of this.

Jennigay Coetzer is a freelance business and technology journalist with 25 years experience, and she writes regularly for Business Day. She also runs media training and writing skills workshops, and is the author of A Perfect Press Release – or Not?, a guide to writing and distributing effective press releases, an electronic version of which can be downloaded free from her website: www.jennigay.co.za.