Getting the prescription right

If you are thinking of taking on the African market, make sure you have at least three p’s in your arsenal – planning, perseverance and patience. Fungayi Chamba, head of Africa operations at Pharma Dynamics, has been dealing with the sub- Saharan African market for more than 21 years and most of that has been in the export industry. “If I have learnt anything during that time it would be that in Africa you need research and the ability to listen so that you understand the market you want to penetrate and plan very carefully how you are going to do it.” It was this knowledge that he brought to the table when Pharma Dynamics, a distributor of generic medication in South Africa, decided to expand its brand into Africa. Having embarked on an ambitious plan to ensure greater availability of affordable medication in sub-Saharan Africa, the first exports were to Zambia in April this year with cardiovascular, antibiotic, allergy and flu medication. “We are now exporting regularly to Zambia and have also entered the Mozambican market and are aggressively targeting Nigeria and Angola. While the first exports only happened this year, the process of expanding our footprint into these markets started at least two years ago.” Chamba says Pharma Dynamics has spent the time, both ahead of the launch into Africa, and on an on-going basis, refining its strategy to ensure the challenges of doing business in Africa are met. “On a macro-level, challenges we faced included a lack of information, poor infrastructure, grey imports and counterfeits, trade barriers and legislative compliance issues, currency volatility and political instability, as well as difficulties with the supply chain and lead-times to market.” These challenges have not necessarily disappeared but good planning has helped the company to deal with issues as and when they arise. “There is huge potential to grow one’s business into Africa despite the challenges that have to be overcome.” With 54 countries and over 400 000 million people, Africa has the consumer base for exporters willing to take the risk. “The key to succeeding lies in your ability to adapt your business model. Having a firsthand experience in more than 13 countries on the continent, you quickly learn to see the consumers’ picture,” says Chamba, “which is important for the sustainability of your business model. “Our research and experience has shown that the consumer seldom buys in bulk. He buys two headache tablets when he has the headache. We must then reconsider selling in packs of ten, thirty or sixty and either adapt to a singles pack or a bulk pack that can be dispensed.” Chamba says it not only means being able to change packaging, but looking at your volumes in a different way. “When you ask how do I grow my volumes in this environment it is not how many packs of tablets I sold, but how many single tablets.” Another important consideration is the product itself. “Medicine is dissimilar to other consumables. People don’t just switch from one medication to another because it is cheaper, so a lot of education has to be done in these markets and we have to spend a lot of time listening to the needs to ensure we are able to provide solutions that are in line with unmet basic needs.” According to Chamba their strategy into Africa has been impacted by differing legislative requirements in the individual markets. “We have based our prioritisation on two aspects – the speed with which we can get product to market and also the size of the addressable market in terms of the opportunity. For instance, in terms of market size, Nigeria is the biggest opportunity. It is also by far more regulated and, as a result, more complicated, he says. Because the need for medicines remains fundamental in Africa, the company is focused on finding the space where long-term sustainable development can take place. Profiling the consumers, Chamba is clear the characteristics within the sub-Saharan African market are no different from any other. “The consumer in Kinshasa or Lagos or Addis Ababa is fundamentally no different from the consumer in Johannesburg – they all have touch points that either drive them to purchase a particular product or not to purchase it. Holistically, there are more similarities than dissimilarities – even though we tend to generally point out the differences and highlight them. Focusing on the similarities enhances our ability to effectively reach the targeted consumer because we can see and relate to their perception”. Physically getting product to the market is a critical piece in the puzzle. Currently Pharma Dynamics uses road freight to Zambia and airfreight to Mozambique, but Chamba says plans are in place to mainly use sea freight to Nigeria once they begin exporting to that market. “It is primarily based on cost, but we also consider need. In certain instances a customer requires a product urgently and hence we will use air freight, although it remains an expensive option and impacts the pricing to the end consumer.” Pharma Dynamics has partnered with experienced agents in the countries of export, who have the requisite market intelligence and capability to responsibly and effectively distribute its products.