In many countries of Africa, Small and Medium Enterprises are big part of private sector which are trying to drive economies. In another hands, they are struggling to survive, taking case of Rwanda, more than 80% of established SMEs they never celebrate at least one year of existing. In Africa, digitization of service is a new concept for many, due the high rate of illiterate people, poor and sometimes absent of infrastructures moreover technology of digitization being very new at large scale make it difficult for many who have born before 90s. Going digital for SMEs including but not limited to being present and active online, using offline software to operate a specific activity, in fact it may depend on internet presence or not.
Normally, digitizing a service or an activity is when you are transforming the traditional way of performing it by introducing technology which cut off unnecessary middle operations.
In my opinion there are main three challenges which causes and accelerate the high rate of SMEs deaths, and all of them should be solved when embracing digitization. Those challenges are:
Brand means trust from the market! People buy from people they know, the ones they can trust not just from everyone selling! To build brand is a time consuming and heavy investment demand when done in another way around digital branding! For many SMEs they even die before anyone knows them or have ever heard about them! Having an official website regularly updated and being active on social Media increase the trust. Sales are supported by the size of market with the purchasing capacity of people, when looking at SMEs you realize that they only sell locally, to people who surround them. For SMEs which may not necessary need physical presence to wherever they target to sell their service or products, going digital offer them the access to new market place and introduce a discipline of professionalism than having access to finance which is critical in many cases.
Last but not least is investing in many unnecessary operations, normally traditional way of doing many things has unnecessary middle operations which cost a lot while they should be reduced or even eliminated when going digital. The risks of losing money, not meeting time when someone wanted to send money in rural area was responded effectively by mobile money which is a digital solutions which may help SMEs selling to many people from different location and not necessary having someone in between to facilitate those transaction or approve them.
For people who are wondering where to grow their money through investment, service digitization in Africa, is a granted approach.