27/01/2026
Thinking of expanding across Africa? Read this first.
Africa is not a single market, and pretending it is has cost companies millions.
Shoprite, Africa's largest retailer, dominates South Africa but has steadily withdrawn from multiple African markets.
The retailer withdrew from Nigeria, Uganda, Congo, Malawi, Ghana, Madagascar and Kenya
Logistics costs erased margins, supply chains didnโt localise, and currency volatility wiped out their margins.
They had scale. But they did not fit local contexts.
Jumia, dubbed the Amazon of Africa, also had a similar aggressive retreat from its pan-African ambitions.
The company exited South Africa, Tunisia, Rwanda, Cameroon, and Tanzania.
Although their technology worked, the underlying market structure did not support it.
Low purchasing power, unreliable last-mile logistics, payment trust issues, and customer acquisition costs far exceeded revenue, making expansion unsustainable in those markets.
This does not mean Africa is inherently difficult.
The issue is that most companies treat it as a uniform operating environment.
Founders consistently underestimate how much changes between countries in terms of company law, labour regulation, tax enforcement, infrastructure quality, consumer behaviour, and business culture.
A business model that thrives in South Africa can require fundamental redesign to work in West or Central Africa.
The fastest way to fail is to assume the next market behaves like the last.
Compliance complexity catches many companies off guard.
Some companies assume demand exists without doing market validation first. Expansion decisions get driven by boardroom checklists: population size, regional proximity, or investor expectations rather than actual purchasing power, the strength of local substitutes, infrastructure readiness, or distribution realities.
Operating without local relationships and knowledge is where other businesses stumble. Without trusted local partners, poor stakeholder relationships, and a failure to understand informal decision-making structures, even well-resourced companies struggle.
Cross-border operations expose companies to financial risks that domestic operations never face. Foreign exchange volatility, capital controls, double taxation, and delayed payments can turn a profitable business model on paper into a cash flow disaster in practice.
Treating language differences, hierarchical norms, negotiation styles, and relationship-building expectations as secondary concerns is also expensive.
Each country operates as a distinct economic system with its own rules, infrastructure constraints, and cultural dynamics.
Success in one African market is not transferable to another. So treat every African country as a new business, not a new office.
Which foreign brand failed in your country, and what lesson should others learn from it?