Africa business relationships and legalities

When you do business in Africa, there are two instruments you shouldn’t play with. These are “relationships” and “legalities.”

Relationships in African business is like the oil that keeps the engine going. When managed well, relationships can add enormous value to your business and its growth. What you shouldn’t do though: do not recruit family members or friends as employees. From experience, no matter how good these people may be, when it comes to taking decisions concerning them it’s like pulling your teeth. For example, if they do something and you’re to fire them, you’ll have your entire extended family to deal with. Your best bit is to help them to find their own path. If they are to take over the entire business operations, then put check and balance systems in place and step back.
If they are friends, you’ll be on your way to damage a friendship. Rather partner than employee. When they are Partners, it’s equal or shared responsibility. One of the ways to protect partnerships is a good legal instrument. This leads us to the second vital instrument, legalities.

Right from the start of business and through the life and death of a business in Africa, legal documents are very important. In the past, Africans had done business based solely on community of trust. These days, the word “trust” within communities has been broken to the point where the only option to keep trust going are legal documents such as agreements, MOUs (memorandum of understanding) and other related documents.
The above legal documents come in handy when disagreement arises. It also sets the tone for how relationships within business should be managed and serviced. This gives each party in the business the peace of mind and room to “trust” the process.
So, as you do business in Africa or looking to start your business, do your best to get a lawyer to draft a legal document for you or find a good legal document template to use.

Let’s discuss. Share your experiences.

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