At the start of 2010, Petersen’s – an 18-year-old South African-based wooden furniture company – was in a tight spot. It was just before the start of the football World Cup in South Africa, and business was slow as all projects were put on hold. In addition, the company’s exports to Europe also started to decline.
“We had to find new markets, and we had to find them very, very quickly,” the company’s managing director Gary Petersen last week said at a conference in Cape Town.
It all started when a Ghanaian businessman walked into the Petersen’s showroom in Cape Town to find out a bit more about the business. For the next few weeks the person called Petersen on a regular basis trying to convince him to go to Ghana.
“Eventually, I got on a plane, flew to Ghana… What resulted from that particular trip, was that we ended up doing the back office furniture for Standard Chartered bank,” Petersen explained.
A few months later Petersen again visited Ghana on a trade mission. During this visit he got wind of a four star hotel that was set to open on Ghana’s Volta River.
“So I got in a car and went up there – business card in hand and brochure. I arrived on site, and one of the main investors happened to be on site that day… He said to me he thinks everything has been procured, and that we were too late… I came home, and [later] I got a phone call saying, ‘please get on a plane, come up here, we need you to measure up the entire hotel’.”
Petersen’s is now responsible for all the indoor and outdoor furniture of the hotel. For the past year the company had a permanent team based in Ghana to work on the project.
Further growth opportunities
Petersen’s is currently in the process of setting up a regional office in Ghana’s capital Accra from which it plans to serve the entire West African region. The company is also busy with negotiations to invest in a Ghanaian business that owns a sawmill, plywood plant and joinery factory.
Petersen said there are significant expansion opportunities for his company to provide furniture and joinery work to banks, hotels and retailers in Ghana.
Despite the potential, Petersen noted that there are many difficulties to doing business in Ghana – including infrastructure constraints and the challenges associated with managing staff located abroad.
Petersen’s advice for other companies looking to expand their operations across Africa is to invest time to understand the local cultures and how things work. “Get to understand the culture. Once you understand that, you can work with people, you can understand why they do things a particular way.”