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FY 1999: Botswana |
[end of document]CHAPTER IV. MARKETING U.S. PRODUCTS AND SERVICES
South Africa is Botswana's major source of imports with a share ranging from 75 - 80%. Not all goods imported from South Africa are of South African origin; some goods are re-exports of South African imports while others have undergone final processing within the country. Many U.S. goods marketed in Botswana enter as re-exports through South African agents and distributors. Locally-based wholesalers and retailers are increasingly looking to establish direct links with U.S. producers to avoid mark-ups (standard U.S. consumer goods often become prohibitively expensive luxury items by the time they reach Botswana) or to diversify their supply away from dominant South African brands. U.S. companies looking for assistance in finding a Botswana agent/distributor may wish to contact BOCCIM, the Botswana Confederation of Commerce, Industry and Manpower, which represents a large portion of local businesses. The Commercial Section at the U.S. Embassy, working through the U.S. Department of Commerce, also provides a wide variety of services including the Agent/Distributor Service for U.S. firms interested in exporting goods and services to Botswana (for contact information, see Appendix E). Direct marketing is also feasible, particularly to local companies seeking to import goods to supply a government tender.
There are a number of successful South African franchises in Botswana, including fast food, automobile repair, supermarkets and department stores. U.S. franchises and licensing agreements include DHL, Federal Express, Coca-Cola, Kentucky Fried Chicken, Avis, and Best Western. There is increasing government and private sector interest in U.S. franchises, though the small market size might make the more expensive franchises not feasible.
Botswana entrepreneurs and the government's investment arm, the Botswana Development Corporation (BDC), welcome joint venture opportunities, particularly where the foreign partner will bring production expertise, product design or marketing ties.
Company formation and registration in Botswana is relatively simple. Legislation governing company formation is contained in the Companies Act of 1959, Cap 42.01, as amended, and distinguishes between external, public, and private companies, the latter being predominant. All companies are registered with the registrar of companies, who certifies that the company is incorporated. The common practice is to engage a local attorney or a company secretary to arrange for a company registration, which can be effected within two weeks. There are several locally based international accounting firms, which also provide assistance to businesses establishing offices in the country. Documents required are primarily the new company's memorandum and articles of association. The Company Act requires that accounts be maintained in Botswana, that there is a resident auditor, and that certain reporting requirements are met.
The Industrial Development Act of 1988 requires that all foreign-owned manufacturing enterprises obtain a license from the Ministry of Commerce and Industry. U.S. companies are advised to consult with the Ministry's Department of Trade and Investment Promotion to ensure that their proposal does not include one of a small number of commercial enterprises reserved for citizens of Botswana.
Prices for most consumer goods are relatively acceptable due to the favorable exchange rate between the Botswana Pula and the U.S. dollar. The current exchange rate is Pula 1 = $0.21. Service and after-sales support are often deficient. Guaranteeing parts and service may be essential to marketing unfamiliar products in Botswana.
Newspapers and radio are the most common advertising mediums (South African television broadcasts reach the major cities and can provide a venue for products marketed region-wide). A partial listing of major newspapers follows:
The Botswana Guardian (Pula Printing and Publishing (Pty) Ltd.) P.O. Box 1641 Gaborone Tel: [267] 300-302 Fax: [267] 374-381
The Botswana Gazette (News Co. Botswana (Pty) Ltd.) P.O. Box 1605 Gaborone Tel: [267] 372-283 Fax: [267] 312-774
The Midweek Sun P/Bag 00153 Gaborone Tel: [267] 300-302 Fax: [267] 374-381
The Reporter - Mmegi Bag BR 50, Broadhurst Gaborone Tel: [267] 374-784 Fax: [267] 305-508
The Daily News Department of Information and Broadcasting P/Bag 0060 Gaborone Tel: [267] 352-971 Fax: [267] 352-541
The Advertiser (Printing and Publishing Services) P/Bag 0081 Gaborone Tel: [267] 314-441 Fax: [267] 312-001
Advertisers interested in wide, local language coverage may wish to contact Radio Botswana at:
Department of Information and Broadcasting P/Bag 0060 Gaborone Tel: [267] 352-541 Fax: [267] 352-541
A few reputable marketing and advertising agencies also publish magazines which are widely circulated. These include Hello Botswana, Private Bag BR53, Gaborone, Botswana, Tel: (267) 374-134; Fax: (267) 357-433.
The Government of Botswana remains a major customer for U.S. goods and services, particularly for major infrastructure projects. A Central Tender Board (located in and controlled by the Ministry of Finance and Development Planning) consists of senior officials from such ministries as Commerce and Industry, Finance, Works, Transport and Communications, and Mineral Resources and Water Affairs. After the tenders are evaluated by a consultancy and/or a technical review board, the concerned ministry will make a recommendation to the CTB.
U.S. firms are encouraged to make contact with the relevant authorities in government ministries or parastatals, and if possible, provide input at the drafting stage of a tender for major projects and manage the account. A pre-bid trip to Botswana to speak to project officials may improve the understanding of the precise needs of the client and allow the U.S. firm to tailor its proposals to those needs. While bidding costs often escalate for U.S. firms due to transportation and logistics, the investment in a pre-bid trip can be useful. Alternatively, a U.S. company may level the field by forming a partnership with a Gaborone or Johannesburg based firm. Foreign firms, namely South African firms, often have a strong advantage over their competitors due to knowledge and name recognition. The U.S. Embassy can assist in identifying appropriate local associates and making initial business contacts.
It is also necessary for U.S. firms to study Botswana's market as well as its existing technology and standards before submitting bids for government tenders. U.S. firms often fail to undertake adequate research on acceptable and compatible technical conditions for the southern Africa region. The lowest offer, though attractive, may not be the leading criteria for awarding a tender. The U.S. Embassy has found the tendering process in Botswana to be generally fair and transparent.
The Government of Botswana addresses intellectual property rights through the Copyright Act and the recently enacted Industrial Property Act of the Laws of Botswana. The Copyright Act, which provides low penalties for violations, has been on the shelf since 1965 and is virtually out-of-date. The new Broadcast Bill, however, includes a clear provision for copyright protection of broadcast material. Parliament is expected to address the copyright law in the near future. The Industrial Property Act also requires implementation regulations to enforce the necessary procedures.
Note* International Copyright, United States Government, 1998 (or other year of first publication). All rights under foreign copyright laws are reserved. All portions of this publication are protected against any type or form of reproduction, communications to the public and the preparation of adaptations, arrangement and alterations outside the United States. U. S. copyright is not asserted under the U.S. Copyright Law, Title17, United States Code.