Exploring Africa’s Education Market Potential
Sommersemester 2019 - FESTO
The purpose of this project is to identify Africa’s education market potential by selecting the most attractive markets and estimating the sales potential for Festo Didactic.
Selection Process and Market Analysis
Festo Didactic proposed to focus on 20 African countries for a market analysis. These 20 countries were divided into four geographic regions (North Africa, Southern Africa, West Africa and East Africa), ranked by their Human Development Index (HDI) and selected accordingly so the number narrowed down to 10 markets. These 10 countries are subject of a first analysis. This analysis is done using the PESTED framework. To the PEST Framework (Political, Economic, Social and Technological Factors) the educational situation (E-Education) and the country’s development status (D-Development) are added. Derived from our PESTED analysis it is possible to conclude that countries differ very clearly in terms of their external environment like corruption or political stability, determining the conditions under which the company will operate. Indeed, the analyzed countries had different levels of economic and social development. The selection of the five markets with the greatest potential for Festo Didactic is based on an index consisting of various indicators that reflect the development of each country. For the five identified top countries (Morocco, Tunisia, South Africa, Kenia and Ghana), a detailed market analysis is conducted to determine their market attractiveness. The education market of these five countries is divided into three segments: Business to Business (B2B), Business to Government (B2G) and Business to Development (B2D). Each of these segments is examined in terms of its business opportunities.
In order to determine a revenue estimate for the five African countries, a benchmark analysis with Colombia, a market where Festo Didactic is already well established, is carried out. As part of this analysis the five selected countries are compared to the benchmark country on the PESTED aspects as well as the three above mentioned business segments. Finally, an estimation of the potential turnover for the project partner in the African markets is made. For the estimation of the potential turnover in the African countries, the company’s current revenue in Colombia is used. Additionally, country specific circumstances are considered by adapting the turnover estimations according to the outcomes from the index compromising the PESTED indicators and the national gross domestic product. From the five selected markets the two countries with the highest potential are South Africa with a revenue estimation of up to 6.4 Mio. € and Morocco with up to 2.4 Mio. € of possible turnover.
Festo Didactic GmbH & Co. KG
Dr. Ing Nader Imani
Linn Kretzschmar, M.Sc.
Tuong Vi Sophie Quach, MA