By Sydney Mabalayo, Strategy and Business Development Director, Southern Power Maintenance
Companies often become interested in a new market because they can see activity there. Investment is increasing, projects are being announced, and tenders are beginning to appear. In a neighbouring country or a sector close to your own, that can create the impression that the opportunity has arrived and the next step is to start pursuing work.
That is usually too late to start understanding the market.
A tender tells you that somebody is ready to procure something. It does not tell you whether enough work backs it to support a serious market-entry decision, whether your business can compete profitably, or whether you understand what it will take to deliver. Those questions should have been asked long before the tender landed on anybody’s desk.
This matters particularly in infrastructure and engineering, where entering a market carries real costs. A business may already have the technical capability to perform the work, but that is only one part of the decision. Equipment may have to move across borders. People may need permits or local registrations. Different standards may apply. Local-content requirements can affect how a project is structured. Travel, accommodation, currency movements, taxation and the availability of local suppliers can change the economics very quickly.
None of those issues makes expansion undesirable. They do, however, make it dangerous to confuse visible demand with a viable market.
One of the first things Business Development should be trying to understand is what is producing the activity. A few large projects can make a market look busy for a period without creating a dependable pipeline of work. The more useful questions sit behind the announcements. Who is investing? What is driving that investment? Is the spending likely to continue? Which organisations are responsible for the assets, and what will those assets require once the initial projects have been completed?
That last question is particularly important in infrastructure. A project has a construction phase, but the asset it creates may operate for decades. Different opportunities emerge at different stages of that life. Installation, commissioning, maintenance, refurbishment and life-extension work do not necessarily sit with the same companies or follow the same buying cycles. A business looking at market entry needs to understand where it can participate over time, rather than judging the market on the first opportunity it happens to see.
There is also a tendency to study a market from the outside for too long. Reports, investment announcements and tender portals are useful, but at some point the business needs to start speaking to people in that market. Clients, contractors, OEMs, consultants, suppliers and industry bodies often provide a much clearer picture of how work actually moves than published information does.
Those conversations can expose things that are difficult to see from Johannesburg or from a spreadsheet. A market that appears open may rely heavily on established local relationships. Procurement may be decentralised. A client may prefer contractors that can maintain a permanent local presence. An OEM may be the real route into certain projects. Capability gaps may also exist that are not obvious from the tender documents but are well understood by the people already working there.
This is where Business Development earns its place. Its job is not to wait for a tender and then decide whether the company should respond. It should build enough knowledge beforehand for management to decide whether a market deserves time, money, and resources.
That work also protects the business from pursuing every opportunity that looks attractive. Expansion can become expensive very quickly when enthusiasm runs ahead of evidence. Senior people travel. Technical teams spend time on site visits. Partnerships are discussed. Proposals are prepared. Registration processes begin. None of this is free, and the cost becomes harder to justify when the organisation has not decided what would constitute a worthwhile position in the market.
Good market development therefore includes knowing when not to enter. Some markets may have real demand, but the margins are wrong, the barriers to entry are too high, or the required investment cannot yet be justified. Some markets are also worth watching for another year before committing resources. Walking away from an opportunity because the wider market case does not hold is not a failure of Business Development. It is one of the decisions the function should help the business make.
The opposite is also true. When the groundwork has been done properly, the first real opportunity looks very different. The company already understands who matters, what the client environment looks like and what the likely delivery constraints are. It knows where it has capability and where it may need a partner. Management has already discussed the level of investment it is prepared to make and the risks it is prepared to carry.
Sales can then pursue an opportunity from a position of knowledge rather than using the opportunity itself to learn the market.
That distinction is easy to miss because tenders and contracts are visible. The work that happens before them is not. Market research, relationship building, internal debate, visits, regulatory work and early discussions may take months without producing immediate revenue. From the outside, very little appears to be happening.
But that is often where expansion is won or lost.
By the time a company sees the opportunity it wants, it should already know why it wants to be in that market.