News
MiX Telematics sets up East Africa office in Uganda
04 April 2011
After operating in the African market remotely for the past decade, MiX Telematics has set up an office in Uganda. While continuing to work through an established network of dealers, having eyes and ears on the ground will enable MiX Telematics better market penetration, as well as enhanced service delivery for their oil and gas customers in Africa.
Matthew Rowlinson, Africa Projects and Specialised Finance MiX Telematics, says it has been a strategic move for MiX Telematics to invest in Uganda. “The company sees Africa as a virgin market in vehicle tracking and fleet management solutions with opportunities for expansion within this sector.” MiX Telematics has achieved market presence by forging strong relationships with a network of dealers in the region. “The current dealer network will continue to be crucial in growing the business,” says Rowlinson.
So why Uganda? Rowlinson says the rationale behind the investment in Uganda, and not the traditional multinational move into Nairobi for example, lies in the recently found oil reserves in the Lake Albert region which will provide oil for a predicted period of between 40 and 50 years. The nearest port is based in Mombasa, Kenya, which is 1200 kilometres from the oilfields, and with dilapidated railroads the major transport supply will be via road.
“MiX Telematics has global supply agreements with many of the oil and gas companies in Africa and globally; and has vast experience in health and safety compliance which is very important to any oil and gas company. Uganda is central and landlocked and thus has access to many different markets in East, West and Central Africa. From a logistical point of view, Uganda is the perfect base for MiX Telematics,” adds Rowlinson.
Beside the oil and gas aspect, Uganda is also a member of The Common Market for Eastern and Southern African states (COMESA), guaranteeing the business community more than 80% tariff reduction in this regional market. Predictability is also possible because of the macro-economic stability of the country, with inflation maintained at a single digit level for over 10 years from a record high of 240% in 1988. “The country has also had an annual and fairly stable economic growth averaging 6% per annum, a result of good macro-economic policies and political stability.”
Doing business in Africa can be challenging and Rowlinson believes the most important aspect to consider when investing in the African market is to have experienced and well-educated strategic joint venture partners. “We do not know the market as well as locally-based people and we realise that success is based upon us empowering locally-based people. Greed and the ‘we know how’ attitude of many South African firms entering the market has been a major downfall. MiX Telematics and its vision of empowerment and improving the lives of many locals will be crucial to our success,” he adds.
Already a major feather in the cap for MiX Telematics is the recent fitment of its fleet management systems into the entire MTN Uganda fleet. “MTN has been a strategic partner of ours for many years in South Africa and leveraging off this relationship has proved beneficial for the Ugandan business too. We consider ourselves the leading provider of fleet management solutions in Africa, especially the East African region. The service provided, quality of the hardware and software and information that we provide to the end user is unique and advanced and we pride ourselves on this. We have our eye on other East, West and Central African countries and are excited about the prospects we see in our future,” Rowlinson concludes.
