**Building sustainable expansion strategies for African businesses**

[\\ Back to Kora Blog](https://www.korahq.com/fr/blog) In Industry Insights # Building sustainable expansion strategies for African businesses January 13, 2025 November 6, 2024   Moyo Oluwatuyi Brand Storyteller Share Article [](https://www.facebook.com/sharer.php?u=https://www.korahq.com/post/expansion-strategies-for-african-businesses/)[](https://www.linkedin.com/shareArticle?url=https://www.korahq.com/post/expansion-strategies-for-african-businesses&title=Building%20sustainable%20expansion%20strategies%20for%20African%20businesses)[](https://twitter.com/share?text=Building%20sustainable%20expansion%20strategies%20for%20African%20businesses&url=https://www.korahq.com/post/expansion-strategies-for-african-businesses/) # Table of contents - [When should you think of expanding?](https://www.korahq.com/fr/blog/expansion-strategies-for-african-businesses#toc-when-should-you-think-of-expanding?) - [How to expand to another African country in five steps](https://www.korahq.com/fr/blog/expansion-strategies-for-african-businesses#toc-how-to-expand-to-another-african-country-in-five-steps) - [‍](https://www.korahq.com/fr/blog/expansion-strategies-for-african-businesses#toc-%E2%80%8D) - [Conclusion](https://www.korahq.com/fr/blog/expansion-strategies-for-african-businesses#toc-conclusion) # Editor's note: ‍ Expansion is exciting. ‍ You’re about to onboard more customers, explore a new country, and find out first-hand who has the best jollof in Africa. Most importantly, you’ve projected a 4x increase in your annual revenue in the first year of expansion. ‍ It looks easy on paper, but your business can fail if you don't answer some key questions. ‍ How do you expand sustainably without burning through all your resources? How do you [identify the right market to expand to?](https://www.korahq.com/blog/challenges-with-building-a-fintech) Which product should you launch with? ‍ If you don’t find great answers to these questions before expanding, you’ll burn cash without tangible results, and jollof rice will be the last thing on your mind. ‍ In this blog post, with the help of three experts, we’ll give you practical insights on how to successfully expand to another African country. ‍ ## When should you think of expanding? ### 1\. You’re getting customer requests from another market This is a no-brainer. ‍ Let’s say your business is based in Kenya and consistently gets inquiries from Cameroon. This might be a good signal for expansion. ‍ > When you get customer inquiries from other countries about your product, it might be time to expand to the new country. Sometimes, it’s purely organic. You’re doing well in a market, but you're also getting inbounds in markets where you're not active. > I've experienced this a number of times when I was at a company called U-Lesson Education. > I was leading sales and essentially expanding across Nigeria, but every now and then, we would get a random customer saying, "I'm trying to create an account, but they’re in the USA, India, Canada, Ghana, Uganda, and even Kenya." > The more you get those types of inbounds, the more you start to ask the question, is there a need? Then, you start to dig in, do some research and maybe visit those places to get more insights.” [‍](https://ng.linkedin.com/in/tayosowole) > [**Tayo Sowole**](https://ng.linkedin.com/in/tayosowole) **, Head, Revenue Strategy, Talstack** ‍ But before you pack your bags to the new country, do some research. ‍‍ ### 2\. De-risking against macro-economic forces Companies are subject to a country's economic forces, such as inflation, interest rates, taxes, purchasing power, currency instability, and unemployment. ‍ Expanding to different countries reduces the impact of the macro-economic force of a single country on your entire business. ‍ The situation in Nigeria illustrates how de-risking is a good motivation for expansion. > With what's happening within the Nigerian economy, there's been a lot of strain on many businesses and so that is one of the reasons that people look at the numbers and say, how do we get better? Is this market the best or do we have to look abroad? > **Tayo Sowole, Head, Revenue Strategy, Talstack** ‍ Here’s a picture of what that looks like in Nigeria. The dollar exchange rate to the Naira increased by over 200 per cent between September 2023 and September 2024. That raised the price of tools like cloud services and other [necessary tools for growth](https://www.korahq.com/startup-kit) without a corresponding increase in Naira revenue for most companies. ‍ For companies that raised VC funding in foreign currencies, that slashed their revenue by the same amount. ‍ > You most likely raised money from investors in dollars and foreign currencies. When you’re reporting to investors, you have to do so in the same currency. > Then, when you are reporting, because of the currency exchange rate, the numbers don’t look impressive, regardless of how well you performed. > This makes you think of ways to increase your forex earning potential to ensure that you are able to meet the expectations of you and your team, your stakeholders, and investors. > [**Gerald Black**](https://ng.linkedin.com/in/geraldblack-b4716953) **, Africa Tech Ecosystem Builder & Consultant** ‍ ### 3\. Revenue growth and market saturation Not all expansion plans are due to customer inquiries from a new country or to de-risking your business. ‍ In some cases, it’s part of your business plan, and it’s just time to hit the road and explore a new market. In other cases, when you’ve found PMF and revenue plateaus, or your market size starts shrinking, expansion might be the next step to meet your revenue goals. ‍ > When you have steady revenue growth, it’s time to start thinking of expanding into another market. > Also, when your business is running smoothly in the market you are in, and you have stability, you should think of expansion. > Sometimes, when you feel like a market is saturated, you ask what's next for the company. How do we get more profit? Can we still grow in the current market or do it elsewhere? > **Bruno Bawa, Operations Specialist at Kora** ‍ When you decide you’re ready for expansion, the next question to answer is, “How?” It starts with market research. ‍ ## How to expand to another African country in five steps ‍ ### **1\. Get the right market insights** Surface-level information found online or media insights won’t cut it. You have to “hit the streets” and engage critical stakeholders. ‍ One way to do this is to engage an expert who knows the layout of the market you’re going into. ‍ .jpeg) **‍** **‍** Gerald Black who used to lead go-to-market at Anchor – a B2B payment infrastructure provider – recalls how he navigates market research for expansion. > “I went with some delegates from Nigeria who are considering another African market. > We went very high, very low, to the streets, and back to government agencies to ask questions and feel the pulse and the energy of the market. > It’