… AfCFTA’s long term success linked to a change in African women buying behaviours
Female buying power has been on the increase for decades as women have come to dominate the consumer landscape as earners, buyers and influencers. Yet, little is known about the impact of women’s consumer power on long-term industrialisation and economic development in Africa.
As we move towards an Africa Beyond Aid, the inextricable link between female purchasing power and economic growth in Africa needs to become a key component of our continental developmental agenda.
Globally, women are the most powerful consumers. According to a recent Bloomberg report, women are responsible for between 70% and 80% of all purchases either through their own consumer purchases or their consumer influence.
In 2016 the Harvard Business Review coined the phrase the ‘Female Economy’ and estimated that women’s global income would increase by US$5 trillion over five years – more than twice the expected growth of China and India’s GDPs put together. This suggests that women have collectively become the single biggest economic force in the global economy.
This power of the purse has not been lost in Africa. There are approximately 350 million female consumers in Africa and according to The African Report, these women drive over 70% of consumer spend on the continent. Women are responsible for a significant percentage of buying decisions and the economic power of women as consumers and influencers is on the rise.
Recent research by Neilsen revealed that in South Africa 18 million women have the spending power in their households. This influence is set to grow, with Nielsen reporting that an estimated 21-million female consumers are expected in the local market by 2025. Through trading women wield a lot of economic power in most African countries. Ghana, Nigeria, Tanzania, Kenya are no exceptions.
Women currently represent Africa’s largest growth opportunity. This means that women play a critical role in the future economic success of nations across the continent. This role is enhanced by the multiplier effect of their purchasing power. Women are often the primary caregiver to both young and old in a family and tend to make the purchasing decisions on everyone’s behalf. As such, they represent multiple markets at the same time.
The influence that women have on the purchasing decisions of others, even if she isn’t buying something herself, also has a significant impact on the economic power of this demographic.
Although the power of the Female Economy cannot be denied, limited access to precise data related to African women’s buying practices means that little is known about the long-term impact of women’s purchasing activities on industrialisation and economic development on the continent.
Even less is known on the propensity of women to strategically source products and services.
The purchasing power of women is on the increase in Africa. Yet, little is known about whether or not women take a more strategic approach to their buying and sourcing practices or whether they take the long-term developmental implications of their spending power into account.
Sourcing behaviours have a direct impact on industrialisation and national and regional-wide development. This means that women’s participation in a more strategic form of sourcing and purchasing could lead to them becoming the main drivers of the long-term economic emancipation of Africa.
As more data on female purchasing practices is gathered over a sustained period of time more information will become available on the influence of women’s consumer power on national, regional and continental growth. Such data will also be beneficial to the understanding of female spending patterns, and how this spending could contribute to lifting families out of abject poverty.
This knowledge could be used to contribute towards the realisation of the United Nations Sustainable Development Goals on gender equality and economic growth. In addition to this, since women also play a significant role in trade in Africa, this information could empower women to leverage the full potential of the AfCFTA to enhance economic development on the continent.
Strategic consumer sourcing is the key to long-term sustainable development in Africa. Since women are in the driving seat when it comes to consumer purchases, more attention needs to be paid on the long-term impact of their purchasing choices and more focus should be placed on the power that strategic sourcing can have for widespread economic growth on the continent.
>>>The writer is an international chartered director and Africa’s first ever appointed Professor Extraordinaire for Industrialisation and Supply Chain Governance. For more information on the COVID-19 Impact Study: [email protected] | www.douglasboateng.com