Here it is! How a Belarusian went to Africa to do business

Yuri Kupryashov has been doing business for more than 10 years — not just anywhere, but in South Africa. How the Minsk resident got to the hot continent, why he had to close the first business there and how much he now earns on tours in Africa — read in his story.

Before moving to South Africa, I received a higher engineering education, worked in my specialty for several years. Back then, money was very tight, so I was looking for an opportunity to work abroad.

In 2006, the opportunity arose to fly on vacation to friends in South Africa, who had settled there a few years earlier. Having traveled around the country for about a month, I decided to try to live in Cape Town, this city fell in love with me from the first time. With the help of friends, I received my first long-term visa and moved to South Africa at the end of 2006.

Jump into the last carriage

I was lucky to jump on the last car and enter the country before the tightening of visa rules. Unfortunately, it has now become much more difficult to obtain any kind of long-term visa, even a spouse visa. People from all over Africa seek to migrate to South Africa, as it is the number one country on the continent in terms of living standards and earning opportunities.

My hopes of getting a job in engineering or IT were quickly dashed as South Africa had a very specific job market.

On the one hand, there is a shortage of qualified specialists, there is even a program to attract foreign specialists with simplified obtaining a residence permit. I was not among the candidates for this program.

On the other hand, South Africa has very high unemployment (24.5%), which creates great competition for all other specialties. And thirdly, after the fall of apartheid (the political system based on the superiority of the white race existed until 1994), the country has a BEE (Black Economic Empowerment) program to support the indigenous population, which gives preference to local candidates when hiring.

In general, I had almost no chances to get a job in a local company. So I started looking for opportunities to start my own business. I talked with entrepreneurs, learned about the procedures for registering a company and maintaining accounting. But what exactly do you do?

I had a starting point — existing IT skills. In South Africa, the online shopping industry was just in its infancy, so I decided to try to open an online store. The Yellow Pages telephone directory helped me determine a short list of specializations. I sat down and pored over the entire magazine, writing out directions of interest to me, along the way studying the number of offers on the network. He settled on musical instruments, studio and concert equipment. There were few competitors, their sites were faded and inconvenient, and the market seemed large.

There are indeed a lot of musicians, bands, DJs in South Africa. Registered a company, created an online store from scratch, guided by examples of successful American stores. Negotiated with importers, conducted a marketing campaign and set up SEO work. Started selling. The first two years everything went well, sales and profits grew as planned. Turnover for the first year amounted to about 30 thousand US dollars, for the second year about 100 thousand US dollars. Profitability was at the level of 25%. However, the third year showed stagnation, and the fourth year fell into negative earnings growth.

Why did this happen. Strongly increased competition — a dozen new online stores have appeared, moreover, located geographically in Johannesburg. Namely, importers are located in Johannesburg. Most of my suppliers didn't allow direct shipping to the customer, so the closer you are geographically to the suppliers, the lower the logistics costs, and therefore the lower the final price for the customer.

As a result, my store began to lose in prices to competitors from Johannesburg and lose clientele. There were three ways out: move to Johannesburg and do business from there, hire people in Johannesburg and entrust them with logistics from suppliers' warehouses to customers, sell the business. I didn’t want to move from Cape Town at all, I also didn’t dare to entrust someone with goods worth thousands of dollars. As a result, he sold his online store to competitors. And he went to the courses of tourist guides and began to study the tourism industry.

0% income tax at the start

You can register a company with a unique name via the Internet, the process takes about a week. You can also buy an already registered company in minutes through specialized firms. But in any case, you will need to open a bank account. This requires a physical presence in the bank and a package of documents — registration for a company, passport or ID, confirmation of a physical address, a certificate from the tax office, etc. Then the bank sends documents for verification to the financial crime control authority. An important point — only a resident of the country can open a business account.

Once you open a bank account, you can start doing business. For many activities, you do not need to be certified or licensed, as is the case with us. In particular, to run a tourist business, it is enough to register a company and open a bank account. In the future, you should not forget to file a tax return once a year and pay a fee for a registered company number.

Income tax for small companies resident in South Africa, the turnover of which does not exceed 1.5 million US dollars per year, is as follows (in terms of US dollars):

• 0% for the first $6,000 of annual income
• 7% — $6,000 to $27,800 annual income
• 21% — $27,800 to $41,900 annual income
• 28% — $41,900 + annual income

The taxation system is quite transparent, declarations can be submitted electronically through the portal of the tax office.

In summer — 3-4 tours per day

Mostly clients find me through my website, TripAdvisor, various travel platforms, Instagram. A small part of sales is brought by tour operators and travel agents. Tourism — seasonal business. At the peak of the summer season, I can sell three or four tours a day, but in the winter there is one tour a week.

Prices for excursions per person vary: in Cape Town and Johannesburg — $50−$350, at Victoria Falls — $26−$265 if there are multiple people in the group — the cost is decreasing.

In addition to tourism, I help companies and businessmen from Russia, Belarus, Kazakhstan, cooperating with South African exporters. Sometimes you need to drive up and control the shipment of goods, settle some issues, and sometimes check the South African company for solvency.

It happens that the company is fake and the cargo does not really exist. There are scammers, unfortunately, but I have learned to recognize them.

Peculiarities of doing business in South Africa

South Africa is home to a multiethnic and multiracial society rich in cultural diversity. On the one hand, this facilitates the process of assimilation, since people have already developed a mentality of mutual survival and respect for other cultures over the centuries.

I have never been discriminated against because I am an immigrant or because I speak with a special accent.

On the other hand, you need to adapt to communicating with different ethnic and racial groups, as each has its own characteristics. For example, the Boers, descendants of the first settlers from Europe, are very fond of using their native language Afrikaans at least a little in communication. The descendants of immigrants from Britain speak with a beautiful accent for the ear.

The so-called Cape Coloreds (an artificial race, arose after the mixing of slaves from different regions of the world), as well as black peoples, speak with strong accents, which can be difficult to understand by ear even for South Africans themselves.

But in general, people are open to contact and will always try to understand you, which speeds up decision making.

South Africans smile a lot and prefer to joke about conflict and laugh at the situation together.

However, the implementation of agreements or tasks is sometimes delayed. I think that this is due to the special mentality and some innate laziness of Africans. Sometimes they need to be adjusted and every day to control the execution of the task.

It is easiest to work with small and medium-sized companies where it is easy to establish personal contact. If the company is large, for example, a hotel chain or a car rental company, then even the simplest issue can take several days, or sometimes weeks, to resolve. It seems that in large companies, employees shift the responsibility for making decisions to each other, since new people answer each time in one e-mail correspondence.

To do business here, you need to understand the local culture and customs in general.

A favorite activity of South Africans — it is «bri», in our — barbecues or barbecues. South Africans gather with families or a group of friends, usually on Saturdays, in nature or in someone's yard.

They discuss the news, sip beer or wine, and roast meat on coals. The person responsible for the coals and cooking the meat is called the brymaster. This is the most important person at the party, so it is considered good manners to "bribe" brymaster — regularly bring drinks, entertain with conversations. A skilled specialist is able to cook different types of meat on coals to the ordered degree of roasting, and all this for a large company and quickly enough.

South Africans are very physically active. Surfing, running, cycling, walking in the mountains. The volunteer movement is well developed. Someone helps children from low-income families, someone cooks food for the homeless, someone works as a lifeguard on the water, someone puts out natural fires.

It's very cool. From my experience in the volunteer fire brigade, I see that well-organized volunteers work very well, because they do not need to be motivated by anything. They originally came to work to do it. I am glad that many volunteer organizations appear in Belarus too.