Travelling through most of Africa, people realize how difficult it is to find proper eating places. It is not question of lacking restaurants or food kiosks. The main problem is how much to trust local ingredients and hygiene. As many travellers experienced, even the smartest of joints may conceal unforeseen outcomes, usually very nasty bugs and stomach-aches. Things have improved much in the past years and, with a sizable improvement in the economy of many countries, local people have created a local demand for affordable and safe eating places. The idea of going out to eat is taking hold in many middle-class families.
“In Africa as a whole, and particularly sub-Saharan Africa, we’re starting to see real growth in terms of the number of households with the kind of disposable income that can support eating out,” says Michael Schaefer, head of consumer foodservice at market research group Euromonitor International. “If we look at just South Africa, Nigeria, Cameroon and Kenya, you’re now seeing about 16 million households with disposable incomes of $5,000 a year or more, which is not a great deal, but is often considered the level when people might start to eat out on a regular basis”.
As in many other cultural shifts in the continent, South Africa is ahead of the pack. Fast food and restaurant chains have been popular there for a long time. And from South Africa, many of these chains have started to occupy available markets in Africa, and beyond. It is the case of Nando’s. From the 1950s, Portuguese immigrants went to live in Rosettenville, a neighbourhood of Johannesburg. They were joined by Portuguese-Mozambicans when Mozambique became independent. With the immigrants, an array of ethnic shops were also born, among them some restaurant proposing typical Portuguese-Mozambican food. In 1987, two friends – Robert Brozin and Fernando Duarte – bought a local joint called Chikenland and started offering a new menu. The idea caught up and, rebranded as Nando’s, the restaurant started opening branches in the Rand area.
In the past 25 years, Nando’s has become the most successful food chain in Africa. Branches are opened now throughout Southern Africa, Nigeria and Mauritius. Nando’s has also opened restaurants in Europe, The USA, Australia, the Fiji Islands and in various Asian countries.
Nando’s is not the only food chain making waves. Ocean’s Basket is another South African food retailer developing fast. Ocean’s Basket serves fish dishes and it is a popular destination in South Africa. But it is increasingly popular in other southern African countries like Lesotho (a mountain kingdom with no access to the sea!) or Namibia – where fish has always been popular, but it is still ‘fishy’ to see such restaurant in the middle of the Kalahari Desert!
Africa is also becoming the new destination of American chain restaurants, like McDonalds and Kentucky Fried Chicken. These companies are opening branches in southern and eastern Africa, but also in Nigeria and Cameroon. Their presence is a clear sign that the local market is growing and offers good opportunities. In fast food growth, Africa is showing stronger growth than China or India. Already, in 2008 Africa spent $860bn on consumption goods and services, which was 35 percent more than India. Plus, in Sub Saharan Africa, chicken is considered the food of highest quality, there is demand and people are ready to spend a little more to have a good meal.
The food business realized that Africa can offer great returns, even though corruption can hamper growth even in this area. Kentucky Fried Chicken (KFC) wanted to expand its South Africa operation and eyed Angola. They sent their scouts to test the market in Luanda, and decided to open a few franchises in Angola’s capital. Two years later, no one location was working. “Nothing happens in Angola without someone of the President dos Santos’ family being involved – says Keith Warren, until recently managing director of KFC Africa – and we were progressing very nicely building our restaurant, until his daughter turned up and said she wanted half the business”. The group was at a stalemate with the regime until KFC management decided to make it clear they would not bow to corruption. The firm pointed out that if they retreated, the country would lose out on employment opportunities and skills development because of that. The dos Santos family backed down, but bureaucratic obstacles cropped up everywhere KFC turned.
The development of fast food is an opportunity for local markets. Companies need to buy fresh food from suppliers and they have stringent requirements about quality and hygiene. In turn, these become the occasion for farmers and the transformation industry to improve their quality.