Kudzanai Sharara in Cape Town, South Africa
Tonderai Kachecha, Founder and Director of Northlea Consulting Limited, has urged African businesses to develop sustainable, revenue-generating solutions that address real operational problems, arguing that returns on investment must be measurable on the bottom line.
Speaking on the panel “AI, Fintech, and Productivity: Transforming African Economies” at the CEO Africa Annual Roundtable in Cape Town, Mr Kachecha used agriculture to illustrate how data can drive efficiency. If a business knows that a particular region will receive light rainfall in a given year, it can distribute seed suited to those conditions.
“That helps you know cutting down the distribution cost and it also helps with cutting down on the marketing production cost, which would then mean a little bit of income goes into your bottom line,” Mr Kachecha said.
He said businesses should design offerings that encourage repeat customers while carrying a clear revenue model. “You want to come up with something that allows people to keep coming back to you, but it will carry a revenue model,” he said.
Mr Kachecha compared such solutions to a “pain killer”, saying it is easier to sell a product or service that solves a pressing problem because it is directly linked to cash. “It’s easier to sell [a solution]… because [it] is always going to be connected for business with the cash,” he said.
He gave the example of a solution that shortens a company’s collection cycle from 35 days to 31 days. That, he said, releases additional days of cash flow, reduces interest costs and improves the company’s ability to fund projects.
“That creates a real new world for a business,” Mr Kachecha said.
He added that such a solution would be sustainable because the business would see the benefit. “We were losing X amount of money, but now with this solution that we have in place, we can now see the real benefit on the bottom line,” he said.
Mr Kachecha stressed that business performance is ultimately judged by return on investment. “A lot of your job is measured by how much you return on investment,” he said.
He appeared on the panel alongside Samuelle Dimairho, Group CEO of Aura Group, and Leleti Gachago, Strategic Business Development Officer at Future Trends Group.
The panel formed part of the CEO Africa Annual Roundtable, which runs from 6 to 10 October under the theme “The Future of Africa: Innovate, Trade and Grow”.
