By Wesley Ngwenya
Many Zambians and non-Zambians alike who are abroad wonder about what they need before they come to invest in Zambia. Many questions are asked such as what opportunities exist? How much money do I need? What is the business environment like? What is the culture like and how does that affect the way of doing business? What is the political environment like?
These and many other questions need to be asked before one plans on returning home to invest in a business. Each of these questions could be dealt in great detail. However, here are a few things that are helpful as one comes to Zambia to do business be it a Zambian or non-Zambian
What is your product or service?
The first and perhaps most important thing, is to know exactly
what product and service you intend to offer here. You should have done a thorough research on the other players in the business of your interest. What are competitors offering and how do you hope to differentiate yourself from them? If it is a completely new product you intend to launch, what is your market and is it something people want or you intend to create a need for it? Remember, just because you are coming from outside Zambia doesn’t guarantee you instant success for your product or service. In fact, even your unique skills whether it is business, medicine, or some other field will be resented. Therefore, it leaves you the challenge to penetrate the market in a non confrontational but strategic manner.
Small market in Zambia
As you come to do business in Zambia, realize that it is a small
market compared to other markets. Depending on how one looks at it but it can be a great opportunity because the market is still fresh and immature. Which means, it leaves open so many industries untapped that one can venture into. For instance, internet usage is still less than two percent in Zambia. There are other industries such as agriculture and tourism that still need some substantial investment.
Since Zambia is a small market it is also worth to mention that one should avoid overinvesting. Your investment has to match your expected return in a reasonable time. It is unrealistic for one to put in millions of dollars and expect immediate returns. When you come to invest in Zambia be prepared to hang around for a while before you start enjoying the fruits of your investment.
Poverty
One of the challenges of investing in Zambia is that it is very poor.
The government is poor and runs on borrowed money mostly. Its citizens are equally poor with millions not working. Again despite the poverty, one can look at this as an opportunity. What aspects of investments would benefit the poor? What products and services are most essential to the poor and those living in rural areas? These are good questions to ask as you address the poor’s plight. Solar energy for example is one area that could benefit the majority of Zambians all across the country at the same time make someone some big money.
Lack of infrastructure
The lack of adequate infrastructure presents a real challenge for
many potential investors. One, therefore, has to be prepared to face the worst. If, for example, your investment is going to be in transportation, then you have to buy vehicles that will stand the Zambian roads. You must realize that you will be spending more on vehicle maintenance simply because the roads are not as good.
Again, the lack of infrastructure should not only be a challenge for an investor but also an opportunity. For example, office space is becoming an issue in especially the capital Lusaka. Those who are investing in real estate will be reaping it big soon. Lusaka cannot get enough offices, shopping malls, play parks, schools, etc.
Knowing the tax laws of Zambia
If you are importing something into the country it is important to
find out what the customs and tax laws are before you come in. If you are Zambian, you actually get tax breaks for importing vehicles, machinery and household goods provided you have been out of the country for a specified period of time. This is a great opportunity to save on customs tax because it is very costly to import goods in Zambia. To avoid the runaround with the officials please make sure you keep all paperwork such as receipts, etc.
Depending on the industry you can get tax breaks for a certain period where you do not pay income tax to the Zambia Revenue Authority. Also if you do not make a certain amount of revenue you can get some tax exemption. Be sure to find out from other agencies on paying pension for your employees if you plan on employing others.
Registering your business
Registering a business in Zambia is quite easy. You pick up the forms from the Registrar of Societies, fill them in and have all the necessary people sign them. Attach copies of articles of association as well as identification for all the directors. The whole process of registering a business takes less than a week provided you have all the required material. You do not have to be Zambian to do this.
Political influence on business
Many times politicians do not interfere with private businesses. It is important to not that Zambia is a democratic country which has general elections every five years. Politicians especially those in the ruling government have a lot of influence on state controlled companies. To do business with a state controlled company or a government department, you have to know someone who is senior. It is important to point out that in Zambia, the government is the biggest spender and almost everything revolves around the government. Businesses that do business with the government are the winners on the Zambian market. It is in your favor to be friends with the politicians and more benefiting if you can get key accounts with the government.
Poor work culture
Zambia has generally poor work culture especially in government run institutions. Workers are not usually in a hurry to do their work and meet deadlines. They get to work late and leave early. The customer service is very poor. You can walk in a store and the attendants will not pay attention to you. Instead, they will continue reading the newspaper or their conversations.
Therefore, as one pursues business in Zambia it is important to understand its people so that you can devise ways to overcome frustration. If you are going to employ people or have business partners, be sure they know what your work culture is and what your expectations will be in the relationship.
Be prepared to wait for a long long time
In Zambia, you have to be prepared to wait for everything. If you are from a western country
like the United States you will immediately notice the difference. In the west people are usually in a hurry to meet deadlines or get work out of their way. However, in Zambia people are not usually in a hurry to do work. Even when you have an appointment with someone, they will come 20 or 30 minutes late without being apologetic. Therefore, you need a lot of patience to do business here in Zambia.
Bribing–know when to do
Bribery is against the laws of Zambia. However, it is a common practice here in Zambia. It is difficult to get anything done without giving or promising an official something. This is especially applicable to big business contracts in government or private sector. Every time you have a business proposal to another institution, the official on the other side is asking, “What is there for me?” Depending how badly you want the business from that institution, sadly you will need to find ways to motivate that official.
Let me clearly state that I do not approve bribery but merely stating what the trend is here in this country. It is very difficult to play it clean in this country when most of your partners around you are playing it dirty. This is not to say, too, that there are no businesses you can work with who will not expect a bribe from you.
Zambians are formal
Zambians are generally formal people who like to be addressed
formally as Mr. John even when you use their first name. First names are rarely used in the business world. When meeting with other business partners make sure that you are dressed formally with a suit and tie. In this country, people respect someone who is “smartly” dressed as it is referred.
Know that “yes” is sometimes “no”
Finally, when a Zambian says they will be able to do it do not take
their word for granted. They will actually agree with you even when they disagree. I have personally found it helpful to tell people that it is okay for them to say no if they are not able. This will, oftentimes, open them up and be able to state clearly whether it is a real yes or real no.
These are just a few things that may be helpful as far as doing business in Zambia. Since Zambia is a young economy, investment opportunities are numerous. For Zambians living abroad, it is very important that you keep in touch with what is happening here so that you can explore the opportunities on establishing businesses as a well of helping the many Zambians here.
what???
i couldnt have agreed more with the last one “yes is sometime no”. Why cant most zambians just say “no” if they can do something. This serously irritates me
Yes Know when to bribe Tetamashimba. Don’t do it if you are not in power because he will take you to ACC. If you are the head of state its okay to bribe Teta
all this will change once am president. i have already proved that i dont tolerate laziness and incompetence. enough is enough. vote MC Sata and UPND-PF for a brighter future, more jobs,less tax and more money in your pockets.
ZAMBIA FORWARD PA BWATOOOOOOOOOOO
interesting but too long… will print…
Have not learnt anything new but still useful. Just to add on make sure you have insurance and bad debt redemption accounts , because when it comes to not paying zambian people are masters at this. Paying on time is like krytonite to zambians .
Dont worry when i will be in parliament we will do it the Germany way. One minute later, you are absent.
interesting article to read
Interesting article though i was expecting a few suggetions for areas of investment because eveything in the article is in short notes what every serious business person will take an interest in regardless of the country
Hey there are other positives that you coulod have dwelled on and not this scorn iwe Ngwenya. Makes me feel like you have a score to settle with Zed by the tone of your write up
Mr Mgwenya, with all due respect, I think you didn’t do a lot of reading around your International Business Acumen. You have made too many generalisations in your article espercially when you talk about the Zambian culture and its effects on business conduct. I sugget you get hold of a book called “Cultures and Organisations, Software of the Mind” by Gert Hofstede. It will give you a good but not absolute view of where the Zambian societal culture is and how much it influences individual and organisational behaviour, altimately the way we do business. Overall, you have made fairly good observations but they could equaly mislead your readership.
stupeed article..how do you portray zambia like its iraq u boob!
This is such a poorly written article by someone who has completely nothing to do or to say. I opened this topic looking for answers to my starting a business in zed and zilch, nada nothing! This guy hasnt even mentioned anything about pacro. This topic is a blody waste of time. Its a report bent on damning the good people of Zambia instead of addressing the core of the topic. He should tell his own relatives to stop being lazy!!!! Nsanya iwe!!!!
im sure he is a nurse
You sure tried to dicourage all from investing in Zed. Surely there is no positive out there!? True, I get irritated by most of what you have mentioned but I really want someone who will tell me that despite all that it can still be done. Please next time you write be sure to include some positive points. remember…..other potential investors are reading too.
I couldn’t agreed more
The author should add one more point , “Zambians just hate to be told facts”
investors should not come and make us slaves
Poorly done and scares investors and unfortunately the writter is biased, reading between lines one can tell.
Sounds interesting. I will comment after reading.
Ngwenya sounds like a man who has failed to find his way in the Zed. We have our own way of doing things instead of comparing us to americans all the time. Maybe Ngwenya should find time and learn the zed way of doing things. He will find out that zambians are extremely innovative and are surviving in extremely difficult times unlike americans who always cry baby whenever they have a slight discomfort in life. If you have failed to make it in zed, go back to america they have social socurity and welfare there.
The article above is pretty stimulating because the basic facts about zambian people and economy have been pointed out.I beg to differ with those guys criticizing the author of this article.Please if you have better ideas just put them in writing also.Ushumfwa pafinono napa fingipene takomfwe.The truth normally hurts.Kudos to the author of this article!!
You are good person Shimu.
I’m not a Zambian, but I beg you not to fight me here please!
Okay, dear friends, as you all know, with negative aspects nothing can be done, nothing at all.
Instead, thoughts such as Ngwenya’s, with my wireless intellect however, it’s my opinion that there is a need to appreciate the fact that he wrote though not everything, but at least something.
Many people are there just to oppose what is developed to encourage others, that’s okay with me.
But doesn’t any one out there know the importance of working together as a nation?
Hide your negativity for the country needs and is open to investors.
I don’t for once believe that the article was meant to compete for completeness and precision of fact. I thought It opens a debate out of I expect of mature learned bloggers to add their thoughts or correct any misconceptions.
Most of what has been said would be very helpful to anyone going into Zambia for the first time intending to venture into business. Its a worthy attempt.
From some of the comments coming out, it appears the message has been delivered but as usual people are in denial and have chosen not to see a bit of sense in the article. Too sad.
correction
……..opens a debate out of which I expect mature learned bloggers to…..
I was a Finance Director and then Managing Director in one of the Zambian companies and I agree with this article. For work to be done, we had daily meetings to monitor progress. We had to re-train employees on customer service. We had incentives and awards for employees who came early for work. In addition, we had an eleborate controls system as we had so many thefts of products. If I compare with other markets within Africa, Zambia is a challenging environment. The problem has been compounded by corruption which has become the norm and increases cost of running the business.
Gee Mr. Ngwenya thanks for the vote of confidence. Please do remember that you are Zambian too when you highlight things like this. How can any one else have confidence if you don’t? I would encourage people to abandon this feeling of helplessness that Mr. Ngewenya has so despairingly described. Instead of sitting back and saying we Zambians will never get it, why not try to be one of the Zambians that shows up on time or let your yes be yes and no be no. I know what you are saying are facts but you are writing to investors home and abroad use WISDOM!!
Interesting analysis. I like the point about pipo wanting to be addressed as MR. Yalikosako iyi yena mwe. Ni ine from now on, i ll insist on being callled MR POMPI
Not a very informative article I’m afraid just a lot of crap about how investing in Zambia is generally pointless. Is it? If it is then why are there so many investors at the moment? Why do they live well, eat well far more than the average Zambian. Besides I want to see some hard facts Wesley. Some financial statement from these foreign investors. truth is investors strive hard to overcome the barriers mentioned in wesley’s article. They do this because they know the return on investment is so much more.
The article is on point the people against it are the ones probably have a cloud of delusion floating around their brains. Just because you don’t like to hear something it doesn’t mean it’s not true be mature and accept criticism as a demand for quality. The hurdles mentioned in the article are commonplace in zambia unless your business is selling viwawasha, tobamutwe’s or kapenta like most of you nay sayers . Instead of complaining why not challenge mr Ngwenya on specifics and facts . Zambian people love to be sweet talked when you tell them the truth they assume the mental foetal position, this is why dull politicians always win because they know all you need to do get apporval in zambia is to tell fairytales
have respect for evely zambian
hmmm #20 santos
ati zambians are extremely innovative people….my foot!!!!!!!!!!!!!!
#29 speaks sense!
Small Market – What is being done to expand the consumer market? What is being done to raise incomes, so there is demand for business to fill?
Poor Work Culture – Why is this, and does it have anything to do with workers not getting paid, or not getting paid on time? And is it really a ‘work culture’, or just an adaptation to bad management practices?
I don’t know if all the points mentioned are unique to Zambia at all though.
#16 very true.
I agree with some of you in saying that it could have gone in a bit more detail and perhaps it is a bit pesimistic. However, it is a known fact that the majority of Zambian business is done under the table and compared to our Western and Eastern counterparts, our work ethic is pathetic. We need to realize our potential and I encourage the young minds abroad to bring home what they have learned. I am 20 years old and a year away from finishing college. I have been blessed with many opportunities and I made a promise to myself to do everything in my power to help my African brothers and sisters. I appreciate this article for what the author is trying to do. The odds are stacked against us and we have many challenges ahead of us. However, we must learn to see the opportunities.
Good article Ngwenya. To those Zambians that are complaining, how do you fix a problem without first acknowledging the problem. A problem identified is half solved.
this guys has said some truths but not all. he has kinda installed a failure recovery scenario where you won’t mourn for years should you not succeed. i agree with some of his points and some of his data is informative. on the other hand, this chap ought to have encouraged people, point out the positives, and basically overwhelm the negative therein. i don’t know what psychology he was trying to use but if there is a negative to haunt or definitely “eat” here is the fact the he takes away motivation due to his past “failures” or un-successfullnes and decides to conclude with that. otherwise for a reasoning mind, it is an article worth reading but not a recommended one for the “faint” hearted, :)).
More like calling a spade a spade.
its….okay… i didnt know that zambians like suits though
Wesley say that to a Zambian and they will tell you mwaibala shani? True but it`s normal. I like the picture under POVERTY. Was that in Mazubuka or Choma?
Wesley you should have gone deeper with your research. To me it looks like raw material which needed refining. YOu probably need to break this topic into four sessions. on the overall you were almost there
what is the story with the pictures. you mean you couldnt find pictures to relate to the subject. Okay ni pa Zed,
I don’t know how long some of you have been away from home, but this article right here could not have described Zed any better. #16 observer I agree with you, Zambians just hate to be told the facts!
BIG UP TO ALL OF YOU -GOOD CONTRIBUTIONS
NUMBALA 25 IWE KA LUKOBO! OSA NAMA ATI MANAGING DIRECTOR YABA! MANAGING DIRECTOR YA NJALA KA? HAHAHAHAHAHAHAHAHAHAHA..YABA
SORRY BREEZE.. I JUST HAD TO SPOIL THIS PAGE ASWELL
Its the likes of Mwenya who are misinforming the world. How does some one sane use the Chirundu collapsed road picture due to last rains as the basis for describing the general state of our road network. Mwenya you need to do more basic reading or get the right information from the right GRZ offices and agencies. Why our working culture may be bad as you describe that is totally unacceptable. Every gruop of pipo have their own way of doing things. You cant compare Zed working with American, that has come a long way. Please dont distort facts. If Zambians had bad working culture they would not be running Banks and other strategic institutions both local and abroad. U forgot to mention that Zambians are friendly and peaceful lot. You cant do business in unstable environment. Ours is paradise
Firstly, most of the issues discussed relate to the social aspects of business environments, which normally have no right or wrong answers. This is a fuzzy topic!
No one can claim to have the right answers to it?
Secondly, the article [whatever you call it] is under researched and lacks proper advice in its scope. For example, what does it mean that Zambia has small markets? Does that make sense? Only you know, Ngwenya, but to most of us that does not make sense.
Last, but not least your images do not correlate to the text.
I am sure from the many negative comments; this should serve as a lesson to do your background research well before publishing any article. People appreciate well-argued articles (better not write anything than produce the article you just did).
If this is for local Zambian consumption then it is ok. But if this is for foreigners then it is tantamount to betrayal. Please note that in the west no matter how bad things are, everyone takes it upon themselves to promote the interest of their country. In UK. the leader of the opposition went to India and China to promote UK interests. When war is declared they all rally behind the government of the day, BUT for you Zambians, day in and day out you denigrate your country, just because you don’t like the people in power. What Wesley has described here is multiplied a million times more in India. Some of these things I have experienced in France and the USA as well. Come on people, pick yourselves up and move on!
As if a foreign investor decides on investing based on what they read on blogs, Theres investments reports and business intelligence reports( check Lulu dot com) for that. Any sane investor can use these things you are complaining about as tools to make themselves richer. For example the political influence can easily be translated to having politicians on your payroll or can ifluence the small market into a large market share. For yur own information investors salivate at problems like this because they know their deep pockets can grease a lot of palms to do what they want. The most corrup regimes in africa are the biggest investors favourites so go figure . It’s not about how it makes you feel it’s about how the situation can line your pockets with money for the investor
It would be helpful if the writer identified investment objects that people could get involved in.
What is the price of farmland? What markets do exist domestically (what is expensive, where do people have money to buy what you would produce, etc.)?
I think the government could do a lot, implementing only those policies which raise people’s incomes.
1) Scrap all school and healthcare fees. This would leave people with more money to spend on consumer goods. 2) Institute works projects, building infrastructure, and pay people for it (say, $5,- per day plus food). 3) Give cheap credit to local companies.
The cost of doing business goes down if there is a working infrastructure in place, which means that in theory, consumer prices go down and people can buy more.
Slumdog Shalapungu,
You’re absolutely right. There is a need for an attitude of nationalism by local businesses and consumers alike. If Zambians were encouraged to buy what is nationally or locally produced, consumer spending would directly translate into jobs for local people.
What is most damaging is the attitude among government that it does not matter who owns the economy. Why would shoprite provide retail services, when we can stimulate local markets instead? Why would shoprite even be allowed to import what is being locally produced?
We cannot leave that to the markets, there have to be strong government policies in place to demand procurment of local products, to safeguard quality control for local producers, etc.
Reading this article would make you not want to invest in Zambia. Is that what the author wanted to happen?
Kwena wabufi uyu umu boyz !!!
That Article touches the button.Zambia is lagging in many spheres.The government the drive lacks priorities.instead of improving infrastructure they have gone on to buy hearses,
Nice try, but please try to use British English as opposed to American English for sense is not complete in most sentences and there are a lot of spelling errors I believe.
_
Matthew 6:33 But seek ye first the kingdom of God, and his righteousness; and all these things shall be added unto you.
please write your own article Maestro Hakucincha we say the English and spelllings nigga..don’t be a fault finder…engourage your brother.
Good article. Touches the real Zambia, including the massive corruption tendencies hahhha!!!
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What audience is this article meant for? For people that grew up in Zambia, this states the obvious. If I am a person from the west ( your words), you just helped me not to invest in a poverty stricken country with poor infrastructure and poor work ethic.
As a person who has invested in Zambia, I found this article lacking in detailed research. Just ask your self, why are so many investors pumping there money into Zambia(Chinese, Arabs and Westerners). Zambia is an investment paradise, it is true, we don’t have top class infrastructure but there is money to be made in Zambia,lots of it. Mining, agriculture, tourism, services, etc. Work ethnics all depend on the company and people you are dealing with, I find that most companies I deal with are fast and have excellent customer care. Personally, I’m just finishing my masters degree then I’m back in the land of endless opportunities! I thank God every time I can for making me Zambian, for the opportunities that he has led for us. God is great, Amen, God bless Zambia untl the end of time!!!
$250.000 US. is too much to expect anyone risk loosing in a poor corrupt country.
The difference between been wealthy (not rich) and poor is knowledge. As they say, knowledge is power! Zambia is the place to be. I know a lot of people in the west who would do anything to be Zambian, to have access to the endless opportunities that can be found in Zambia and the surrounding countries. The author wrote the article as though Zambia is an Island when we are surrounded by potentially some of the riched countries in Africa right now and for a long time to come. If you can’t see the opportunities then you will end up working for me one day!!
whatever!…. which just essentially shows how mean and self serving zambians are while trying to portray themselves as good, friendly people
#60 i agree with you. This ngwenya guy never did his research. It’s like making a report about Chadiza whilest you’ve never been to Chadiza.
Ciroc #34. I admire you positive outlook, i think your views are very admirable and, dare i say, you sound quite mature for your age. I think our country would benefit if we had more “youths” with a similar mindset.
Zambia is very poor and everything in this article is true
Zambia will never attract true investments as long as the rule of law for everybody if not followed and enforced. This applies to corruption as well as the lack of knowledge about Zambias own laws, by local police, immigration, government officers etc. This makes it impossible for any investor, Zambian or foreigner, to operate and develop a sustainable bussinees. Therefore no investments and true development untill this problem is solved.
This was a good refresher. Looking forward to getting through the tough culture adjustments. Thats our country for you!!
If any of you beach us chimbwis have any input, go ahead and say something! At least this chap is laying it out! If theres an expert willing to elaborate in detail about the pros and cons of starting up a business in Zed, please do so!
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this really helped me on my research on doing business in zambia
Let me start by thanking Mr Ngwenya for the honest article, Its a good 1 that’s y its still here. This is as far as i am concerned the best write up i have ever read about a country. If nations were this truthful, we would not be having issues of corruption -wasted investments because investors will be aware of complexities before delving into investing huge amounts. Besides, a problem shared, we know, is half solved. Baring our problems like that gives us a wider range of solution providers whereas hiding them only misconstrues the perception of others on the short run & creates more problems on the long run. What will be your impact if you are only interested in investing in a perfect society? What’s your CSR? Any prospective investor that reads this & retreats is not ready for…
Whatever characteristics the author has mentioned is probably true for any country – and surely for most countries in Asia and Africa.
It would be a great help if there had been some specific the author would recommend to go for or shy away from.
For example, I am currently thinking of setting up IT education initiatives in several African countries – which would also need blessings from the Govt. authorities translated into infrastructure. we are a group of professional of high repute and vast experience of doing international business in IT, but not enough fund to pay upfront accommodation money.
I do not get much of fact supporting or denying whether Zambia would be a good candidate. Can the prospective Presidents and Minister who have introduced themselves in this thread,…
After living in Europe for some time now, I have realised that doing business in Africa especially Zambia needs a lot of patience. I was trying to connect with other business, and it took me a week to speak to the department manager because he has been in and out of the office and mostly in meetings.
When I finally spoke to him, he said no one notified him of my attempts to reach him.
Even the one of the biggest Telecoms company doesn’t have proper customer services.
I called one of the Radio company for advertisement, because of my accent, they gave me a hug quotation to advertise on their radio. I called my friend in Zambia to contact them, the price was reasonable. – Wha the f**k?
what a great article mr ngwenya, well u r spot on when it comes to us zambians. We don’t want to be told the truth and the majority of us are always negative.. We should change our mind set coz Zambia should be far much better as compared to other African countries.. The guy has pointed out on investment opportunties available in Zambia but it’s a shame coz you guys are focusing on the negative like you always do instead of opportunities metioned here… Thanks man again coz us investors we always have a eye for opportunities.. I can’t wait to put my Money were my mouth is..God bless you! Proudly Zambian.. Am a chokwe by tribe.
Surely this is ridiculous, the image you are painting of our country is totally unacceptable and its unfortunate that some Zambians are Agreeing to what has been written in this article. Corruption is there in every Country but that doesn’t mean we entertain it here in Zambia. Am sorry but this article is totally unacceptable and disrespectfull.
This article is a reflection of what goes on in business within developing countries and not limited to developed countries. The same level of intolerable business practices outlined, from work culture to corruption also apply in major countries in Africa…The most corrupt know themselves, talk about oil…………. If this article is written by a Zambian, I really pity the ***** for washing his dirty linen in public. As of today, Zambia boasts a very favorable investment environment, attracting the likes of Dangote. Lets this …. address the topic”What you need to know before coming to do business in Zambia.” – tax exemptions, the peaceful environment, good listening culture and ability to follow strict instructions.. the cons have been highlighted but however been exaggerated…
Your article about Zambia reflect the true African habits,almost 90% of what you says about its happens African countries,this image is not only Zambians is African image.Its unfortunate that we Africans are not good in accepting criticisms that would address our problems. I have interest to invest in Zambian,thia article have giving me an insight about Zambia to prepare for the challenges. There is Corruption every Country in the world but differs, but that doesn’t mean zambia cant develop.Thank you for article, i respect your courage.