Random reflections from a week in Lusaka

The flight was full from Johannesburg to Lusaka. Just a two hour trip and I was peeking past the wing of the plane to get my first glimpse of Lusaka as we burst through a ceiling of clouds. Large circles of green irrigated crops. A few constellations of high-rise blocks. Industrial buildings catching the sunlight. Colourful urban houses.

As we closed in to land at Kenneth Kaunda International Airport, I got a closer look at a cluster of homes on Lusaka’s rim, where small plots of land were being used for subsistence farming.

Disembarking at the petite airport, I peeled off my jersey to embrace Zambia’s warmth. And after passing through passport control and picking up my luggage, I found my taxi driver and we began the 40 minute drive to town.

I was in Lusaka for a week to learn more about the capital’s business environment, and to speak to some of the country’s business leaders.

South African retail giants dominate

One of the first things I noticed about Lusaka was the incredible presence of South African brands and retailers. At one point I stood on the side walk in Cairo Road and could see three Pep stores, seemingly competing with each other.

A visit to some of the large shopping malls – such as Manda Hill and Levy Junction Mall – and I almost forgot that I wasn’t in South Africa.

Grocery retailers such as Shoprite, Pick n Pay, Food Lover’s Market, and Spar. Clothing and consumer goods stockists like Woolworths, Foschini, Mr Price, Edgars, Game, Hi-Fi Corp and OK Furniture. Fast food and restaurant brands including Steers, Nando’s, Spur, Debonairs, Pizza, Wimpy, Hungry Lion and Ocean Basket.

The list seems endless, and one thing became very clear to me: South African companies have identified something special in this market. They believe in it, and they are investing in it.

Catering for growing middle class

For many of these brands, the growing middle class is their target and there is a demand for modern shopping experiences and higher quality products. This is not to say that it does not come at a price. I poked my head into a popular South African clothing retailer and saw a dress I had bought a few weeks earlier in Cape Town. A quick conversion from Zambian kwacha into rand and I noted a hefty price mark-up – no doubt a result of the transport and duty costs of getting the product into landlocked Zambia.

Every Shoprite I visited was packed, and many of the food products were produced locally, such as the yogurt drink Zamsip by the country’s large food and agribusiness group, Zambeef.

I also noted a couple of fast food chains and restaurants had adapted their menu to local tastes. For example, Steers offered nshima – a local maize flour dish – as an option for a number of their meals instead of chips.

But for the majority of residents in Lusaka, the shiny modern malls are not their first port-of-call, and informal traders and local standalone shops on busy city centre streets seemed to never be short of customers.

Emerging stock market

Zambia underwent major restructuring in the 1990s, starting with the country’s long-standing ruler Kenneth Kaunda being ousted in the first multiparty elections in 1991. Over the next few years steps were taken towards liberalising the economy with the privatisation of parastatals and the abolishment of exchange controls.

The Lusaka Stock Exchange (LuSE) is one of the continent’s youngest stock markets. It has just turned 20 and was automated in 2008. It currently has 22 listed companies, with liquidity being one of its major challenges. However, the exchange is establishing the LuSE-Alternative Market this year to cater to the capital-raising needs of small and medium sized enterprises in the market.

While the business environment is young, the market holds clear potential. A couple of business leaders I spoke to pointed out that Zambia may be landlocked, but it is also “land lucky”. It borders on eight countries, with access to hundreds of millions of consumers in southern, eastern and central Africa.

Journalists asking for money – whaaat?

I struggled to gain interviews with some heads of local companies, where I was met with suspicion when I said I was a journalist and wanted to share their insight into the Zambian business environment with our readers. On a number of occasions I was asked how much this would cost them, or instantly dismissed with a “we are not looking to buy anything”.

This surprised me, and I would quickly explain that an interview would require nothing but their time and their willingness to share their market knowledge.

After the third time this happened in one day, I started to ask where it was coming from and found that many of these companies are often approached by “journalists” for an interview, only to find that they were looking to sell advertising in their publication or wanted money for a story.

On a positive note, none of the companies that How we made it in Africa had interviewed before shared this concern about speaking to us.

The people, the people, the people

Every business head I spoke to in Lusaka said one of the best things about Zambia are the Zambians. I took this with a pinch of salt – after all, which business leader would tell a member of the media that they were not fond of their target market or workforce.

But after a week I began to realise that there was something more to what they were saying than simply grabbing a marketing opportunity.

From what I experienced, Zambians are generally friendly, peaceful and very welcoming to foreigners. I was greeted everywhere I went, and often approached for chats. A young chess player, walking in the same direction as me asked where I was from, and we ended up chatting about the game of chess and our mutual belief that every child should be taught to play.

Another gentleman insisted he help me across a busy street during rush hour traffic, and I soon learnt he worked for an independent media house – I was then provided a tour of their broadcasting studio. And while taking the bus, I found myself flooded with questions by two young students who wanted to know more about violence and crime in South Africa.

I never once felt isolated or lonely, and by the end of the week I understood why many people arrive in Zambia and never leave.

SOURCE : http://www.howwemadeitinafrica.com/random-reflections-from-a-week-in-lusaka/43726/