Local producers should capitalise on ZimTrade export market intelligence

One of the key strategies to revamp Zimbabwe’s economy is to ensure adequate value-added export earnings so as to boost foreign currency generation and retain high-value jobs.

The weakening of domestic production in the past years and subsequent drop in exports have undoubtedly affected other sectors of the economy in general, along with the unavailability of locally-produced essential commodities and services, which have stoked persistent trade deficits.

There is a need to urgently synergise public and private sector efforts in coming up with appropriate steps towards improving the country’s exports as a sustainable path to attaining real economic stability and growing the economy towards the envisaged upper middle-income status by 2030.

While the National Development Strategy (NDS1:2021-2025) sets the tone for jump-starting productive capacity in key sectors such as agriculture, mining and manufacturing, economic experts have called for speedy diversification to the exportation of value-added goods and services as opposed to reliance on exportation of primary commodities. Higher value addition and import substitution are at the heart of the NDS1 re-industrialisation focus.

However, in a world that is undergoing a shift from typical industrial to information-based economies, developing robust export market intelligence has become a game changer. Big corporates and governments invest more in this thrust so as to attain reliable export data, which forms the bedrock of business management decisions.

Competition in the export market is ruthless and Zimbabwe has to be aggressive in order to make it. Local producers, thus, need to be assisted to build adequate export capacity and be trained to analyse real-time market intelligence and information aligned to their specific target markets in terms of buyers’ profile and competition, among others.

This means that as local businesses ponder on increasing their output and expanding geographical market coverage beyond the borders, they should utilise available market intelligence to appreciate diverse consumer choices, attitudes, styles and other attributes, which should inform their use of branding, product differentiation, advertising and sales promotion.

According to Katherine Arline (2019), at the core of market intelligence is the use of multiple sources of information to create a broad picture of a company’s existing market, customers, problems, competition, and growth potential for new products and services.

The British Journal of Marketing Studies (2014) Vol.2 views market intelligence as a strategic tool for competitive edge. It notes “the impact of competition in the business environment has compelled many organisations to turn around and start scanning the environment for information so as to have competitive edge over other similar organisations within the industry”.

The country’s export and trade development agency, ZimTrade, has been very instrumental in generating periodic export market intelligence survey reports to assist local companies to grow their businesses. In the past few years ZimTrade has done several export market surveys focusing on Botswana, Zambia, Namibia, Democratic Republic of Congo, Angola and Mozambique. Also covered have been key markets outside southern Africa such as South Sudan and Kenya. Last year the trade promotion agency did a market scanning exercise in Rwanda.

At the moment ZimTrade is conducting a market survey in Tanzania while another pre-mission assessment of DRC market is underway.

The market survey in Tanzania is focusing on processed foods, building and construction, horticulture, agriculture inputs and implements sectors.

Given favourable competencies in mining and agriculture, the mainstay of the country’s economy, regional markets provide a soft landing for Zimbabwean products as they are easy to access and do not have strict requirements. Zimbabwe and its southern region peers are also signatories to the Southern Africa Development Community (Sadc) Trade Protocol, which stimulates and encourages trade by giving one another preferential treatment in the reduction or elimination of customs duties.

Already, preliminary surveys have shown that fast-moving consumer goods manufactured in Zimbabwe such as peanut butter, honey, sugar, cooking oil, bathing soap, and washing soap, are highly sought after in the region. The appetite also extends to manufactured electrical machinery, furniture, processed food, horticultural produce, pharmaceutical products, animal or vegetable fat, cereals and tobacco.

The DRC, for instance, presents a huge export opportunity for Zimbabwe-produced mining supplies such as protective clothing and consumables such as rollers, belts, crushers and valves among others. There are also opportunities for agriculture inputs and supplements, focusing on smallholder farmers as well as established commercial farmers.

While most of the surveys are focused on the African region, exporters have been implored to also leverage on the Government’s engagement and re-engagement policy to explore and re-ignite markets in all parts of the world such as China, Russia, Britain and wider Europe, among others.

The key survey findings have been shared with businesses reflecting the competitive advantages that Zimbabwean producers should take advantage of in order to grow export earnings.

“Having access to market intelligence is one part of the journey a successful export venture requires. Through our market intelligence service we conduct surveys in strategic markets on behalf of potential and existing exporters and the findings are available for companies that are developing market penetration strategies,” says ZimTrade chief executive officer, Mr Allan Majuru.

He said before venturing into export markets, it is important for local companies to know, among other things, specific requirements and expectations of the market, competition, pricing models, distribution channels, documentation and other statutory requirements.

“We go beyond providing product or service specific insights as we connect local exports with buyers. The market surveys are also intended to develop strong linkages between Zimbabwean exporters and buyers from across the world,” said Mr Majuru.

In order to achieve inclusivity towards sustainable development and in line with the National Export Strategy and the Zimbabwe National Trade Policy (2019-2023), the culture of producing for export needs to be inculcated among all producers, particularly small to medium enterprises (SMEs).

The Journal of Small Business and Enterprise Development (2020) similarly stresses the importance of small businesses acknowledging the practical benefits of market intelligence and harnessing these advantages accordingly. It further notes that these have proved to be crucial in the implementation of more formalised marketing strategies that allow small businesses to create value for customers and improve their performance.

It is in this context that the Government policy proposes an exports roadmap that will realise US$7 billion worth of exports by 2023 and US$14 billion in export value by 2030. The specific objectives of the National Trade Policy and the National Export Strategy are to promote free and fair trade; to promote export-led production and industrialisation; promote the diversification of export products and markets to increase the national export of goods by at least 10 percent annually from US$4,5 billion in 2018 to US$7 billion in 2023.

Growing exports is also expected to improve the balance of trade position by at least 10 percent annually, and to improve Zimbabwe’s ranking on the World Bank’s Trading Across Borders Distance to Frontiers Index from 54,34 percentage points in 2018 to 65 percentage points in 2023 and 75 percentage points in 2030.

This means that women and youth owned businesses across the country must come on board and embrace the available export market intelligence to innovate and increase wider export capacity. In this regard, adequate product innovation coupled with adequate market intelligence is a powerful tool for SMEs internationalisation.

This is crucial for Zimbabwe at a time when the country seeks to fully exploit the growing impetus towards regional integration as well as the opportunities that arise from the African Continental Free Trade Area (AfCFTA), which came into force in January this year.-chronice.cl.zw