Organizations of today are increasingly resorting to sourcing activities for lowering their costs of production. Marketers of today are leaving no stone unturned to gain a competitive edge in the global perfectly competitive markets of today. South Africa is catching the eye of organizations when it comes to conducting sourcing activities. With South Africa sourcing activities, marketers are able to reduce the production costs by a significant margin.
What are the Factors that are Contributing to Sourcing in South Africa?
No other country in the world has mineral and natural resources like this African giant. South Africa is rich in valuable minerals, namely, diamond, platinum, and gold. The ever-growing domestic market is further intriguing marketers of all sorts. The factors that are contributing to sourcing in South Africa are discussed as follows:
- Expansion of Domestic Markets: This is one of the prime reasons, why marketers are going with South Africa for conducting sourcing activities. The middle-income group is increasingly preferring this African country for its rapid economic development in recent times.
- Healthier Economies: South Africa boasts of having a strong economy, unlike most other African nations. There are lower inflation rates, minimal foreign debt and curtailed budget deficit in South Africa, which are proving a boon to the marketers for conducting sourcing activities. Companies are preferring South Africa procurement as it is enabling them to get the best quality of products and services at a low cost.
- Diversification of Products: In traditional times, it was two or three products that dominated the sourcing scenario of South Africa. The products and services are more diversified nowadays while giving a plethora of options to the marketers. This African country has witnessed steady economic growth from the past few years. The expansion of consumer markets has instilled a fresh lease of life into the South African economy.
- Highly Developed Infrastructure: South Africa takes pride in having a highly developed infrastructure. The superior transport systems of South Africa are capable of reducing supply time by a significant margin. The highly developed infrastructure and superior transport systems are catering to South Africa sourcing in more ways than one.
- Favorable Political Climate: Favorable political climate is another factor, which is accelerating the sourcing scenario of South Africa. There are low tariff barriers for companies while operating in the South African context.
- The Growth of Financial Institutions: There are financial institutions in the form of International Finance Corporation, the African Development Bank, and the African Export-Import Bank that is facilitating trade in South Africa in the best possible way.
- Improved Payment Systems: South African workforce is aware of the latest trends in technologies while implementing these into the production process in an effective manner. The South African payment system is embedded in modern-day technologies and thereby, giving relief to the organizations in times of engaging with new market segments.
In the forthcoming days, South Africa procurement is likely to gain more attraction from the part of organizations. If you are thinking about sourcing your key business functions, South Africa can be your ultimate choice.
