Identification of logistics investment targets in Africa
Client: Large Japanese trading house
- The customer, a large Japanese trading house with global trading activities, has started a project to identify potential African investment opportunities in food distribution, chemical distribution and logistics infrastructures.
- The customer put together a phased plan to identify logistics targets, requiring specialist inputs from Drewry, its appointed external logistics consultant.
Client Objectives and Expectations
- The first step of this project was a market survey and forecast of exports and imports for major commodity groups of 16 target country markets in sub-Saharan Africa.
- The second step was an analysis, for 2 specific target countries, of the maturity of third-party logistics (3PL) activities, the main third-party logistics service providers, the market and opportunities, the main exports and imports and a list of recommended companies (ie local logistics players) to talk to about investments.
- Later steps of this project were to include the commercial due diligence of the targeted logistics companies.
- To overcome the lack of good data in Africa, Drewry mined various proprietary and public partial databases to obtain a full picture of the main imports and exports for key commodities and developed a methodology to forecast different commodities based on different drivers;
- Drewry consultants traveled to 2 target countries (Nigeria and Angola) and interviewed industry contacts and new business contacts of interest;
- Drewry consultants analysed data and interview material.
- Drewry identified the large commodity flows and the high-growth commodity flows for the 16 countries under review;
- Drewry provided an assessment of attractive or growing logistics activities (including 3PL activities) in Angola and Nigeria, as well as insightful views on future market potential;
- Drewry provided insightful comments on the level of risk and competition for investors in Africa;
- Drewry advised the customers the local specific business features, success factors and current trends of logistics activities in the countries under review;
- Drewry provided names of innovative companies to partner with.
"Our company found potential for logistic activities through the study and is now looking for specific projects based on the insights from the study."
Anonymous, Client Project Leader