Market Research in South Africa
South Africa is one of Africa’s leading economies.
As a member of G20, this country provides opportunities for business growth and is well positioned to influence trade beyond its borders.
South Africa’s Strategic Industries
Starting as an economy established in the primary sector, South Africa has been shifting towards being an economy driven by the tertiary sector. Here are some of its most strategic industries.
1. Manufacturing
The manufacturing industry in South Africa is driven by vehicle manufacturing. International brands such as BMW, Ford, Volkswagen and Daimler-Chrysler have production plants in the country.
Another key manufacturing sector is ICT and electronics. With thousands of companies in this sector and ready access to new technologies, South Africa has seen rapid economic growth brought about by telecommunication equipment and electronics manufacturing.
2. Mining
South Africa is a global producer of precious metals and minerals, industrial minerals, energy minerals as well as ferrous and non-ferrous minerals. The country has one of the world’s largest reserves of gold, diamond, chromite and vanadium.
With an interest in mining for rare earth, the country stands to become a supplier of the components used in smartphones, electric vehicles and high-tech weaponry.
3. Tourism
The tourism sector is a big income earner for the country. Some of the favorite tourist attractions in South Africa are safari drives, wildlife, water sports and beaches. The country also ranks highly in the world as a business events destination.
4. Financial Services
South Africa’s banking sector is well developed and accommodates many foreign financial institutions. The market is competitive with big and small banks as well as investment and merchant banking facilities operating in the country.
Business Opportunities in South Africa
South Africa offers various business opportunities. These are mainly in the below sectors.
1. Healthcare
The need for healthcare in South Africa is huge. Setting up a healthcare business in South Africa will however go beyond serving the locals only. With the whole continent importing medication and South Africa having a strong manufacturing base, it’s possible to start an export-focused medical business in the country.
2. Education
Many educated South Africans are emigrating to New Zealand, Australia, Europe and the US in search of greener pastures. With those left behind being unable to handle some high-tech jobs, investors can fill this gap by running private schools.
With the majority having access to the internet, e-learning can be a lucrative option.
3. Real Estate
Despite other countries reporting few young property buyers, South Africa has seen a record number of millennials buying homes. The strongest demand is for affordable property. Trends in property sales reveal that investors utilizing emerging marketing channels are seeing more purchases than those sticking to traditional advertising.
4. Technology
Technological innovation has seen the growth of online shopping as well as Fintech. As consumers blend technology with their everyday lives, the demand for technological solutions will only increase.
5. Energy
There has been an uptake of renewable energy and corporate customers have shown a willingness to pay more for green energy. With Energy as a Service (EaaS) gaining acceptance and the cost of storage technology reducing, the energy sector is a strong candidate for profitable business.
Challenges Facing South Africa’s Economy
South Africa struggles with unemployment and this leads to a high crime rate. Other socioeconomic problems such as corruption, political instability, poor health and teenage parenthood also arise from this.
South Africa’s Business Location Hubs
Various cities and regions in South Africa have a very enabling environment for business. One such city is Johannesburg, recognized globally as a great location for startups. Cape Town also ranks highly with many startups and venture capital firms calling it home.
The Stellenbosch municipality is also a business hub due to it’s proximity to the Cape Town metropolitan area. It has a comparative advantage in manufacturing, financial services, wholesale and retail trade as well as the hospitality sector.
About Market Research in South Africa
South Africa provides many opportunities for entry into the African market. A thorough market research is however needed to understand the trends, customer dynamics, corporate intelligence and other market insights so as to create a winning strategy.
SIS International Research has been conducting detailed market research for local and international businesses for years. We have the expertise and experience to analyze markets and advise businesses on the best way to launch and carve out a portion of the market for guaranteed business growth.
