Redington plans Africa expansion
Distributor Redington will expand deeper into Africa next year and open offices in both Ghana and Tanzania by the second quarter of 2005 to meet what it claims is Africa’s ‘phenomenal’ demand for IT.
Distributor Redington is already planning to extend its African distribution channels by opening offices in Ghana and Tanzania by the second quarter of 2005. The distributor, which has presences in Nigeria and Kenya, has been driven to expand its distribution networks across both East and West Africa by the demand for IT.
“We only began working in Nigeria a year and a half ago but Africa is a huge region and this is where the opportunities lie for the channel,” commented Sumant Saran, general manager for Redington's Africa operations. “The annual growth rate for East Afrira is at least 12%, while for West Africa it is double that, at 24%. Middle East markets are not growing as fast as they used to whereas African IT is enjoying phenomenal demand and growth.”
Distributors dealing with Africa do have to overcome obstacles when establishing an in-country presence but Redington is confident of setting up facilities by April 2005. “We are attempting to circumvent laws relating to foreign ownership companies in Ghana, as we would have to invest US$1m into the country,” added Saran. “In distribution you do not want to tie up your capital to that extent. But we think everything will work itself out and we have the backing of major vendors such as HP who want us to move in quickly and put our tent there.”
Saran expects that Redington’s activities in Ghana and Tanzania will mirror the success of Nigeria and Kenya, where the distributor has added another string to its bow by recently becoming a service provider.
“We have exclusive service contracts with vendors such as HP, Acer, BenQ and FSC. This is a completely new concept in areas like Nigeria where no distis deal with services and it is a huge value-add for us. Resellers used to buy from distributors sat in Dubai who had no official contract to sell these goods. They now have an option of buying from us and we give them full control over the product. Vendors are happy to support them on warrantied product and this is a tremendous value-add that has contributed to our explosive growth rate in the African market."