UT Bank board members at the time of collapse Source: Ghana | Myjoyonline.com
The Bank of Ghana (BoG) revoked the license of UT Bank in 2017, an action has been triggered by the inability of the two banks to turn around their negative capital adequacy position which has lingered on for some time now.
They do their business from a strong point of sale and position themselves as either the “go-to” or exclusive brand. This is among other factors that makes for example Apple, the brand of choice for communication gadget. Long after its introduction on 1st April, 1976 (43years ago). This article discusses lessons from Ghanaian business models that fade out quickly, perhaps due to their “over subscription”.
Most financial giants describe Ghana as a rising economy. Provided however that there is a consistent proper application of various financial policies including suggestions by the International Monetary Fund (IMF). Governments over the years have put in places various thriving business policies coupled with a conducive environment to aid companies grow, but that alone is not the “game changer”.
Communication Services Business
Ghanaians over the years have been introduced to various business models that last only for a while. In the 1990’s when communication gadgets like mobile phones were scarce, the sudden rise of communication centers was seen all over. Every other junction had a kiosk or container where this business operated. The business required an installation of a landline telephone network used for either receiving or making calls for which income was generated.
The over saturation of this business everywhere saw most of the owners not breaking even with time. This led to most of them gradually adding internet provision services. This was popularly known as “internet café”. This business required the use of a number of computer devices connected to the internet for browsing or seeking information purposes. The internet café business was generating substantial income till it became uncompetitive again due to over subscription. Another reason that saw the internet café business dwindling was when mobile telephone was widely introduced and accepted by Ghanaians in the late 1990s.
However,in recent times, the sale of call cards seems to have taken root. Most of these telecommunications companies have individuals retailing their calls cards to customers on a daily basis. Hopefully this business will not die out since it has employed a substantial amount of people.
Food Business
The late 90s saw a sudden rise in “fast food joints or eateries”. All one needed was a small space, cooking utensils and most importantly rice. The fast food joints as a business model employed a number of young men in my neighborhood. The early practitioners of this business enjoyed the toil of their sweat because fast food was in high demand. Business started declining when again a lot of individuals ventured into the business. Now, due to the availability of options, income generation was not consistent hence the early practitioners had to venture into other models.
This saw the introduction of banku and tilapia joints. Others also ventured into pork joints, which seems to the model that is recently trending. This I believe will eventually be over subscribed looking at the success stories most of the practitioners share during interview sessions in the media.
Clothing Business
This was also one lucrative business some years ago. Almost every turn in town had a boutique shop in operation. Yes the second-hand clothing was still on but the boutique business was thriving. Just like the earlier business models shared, the boutique business quickly saw most young people getting into the trade. Apparently, most of them were stalked with cloths from second hand dealers but packaged differently. The packaging attracted the attention of most customers. However when the secret was out that the cloths were re-packaged people then decided to go directly rather to the source, for example kantamanto (home of second hand clothing).
Delivery Business
This business model arguably is still in vogue. Major delivery services known worldwide such as the DHL and United Parcel Services (UPS) are still in business. I believe it is due to best practices they adhere to and innovations introduced. Innovations such as tracking of goods, spot on delivery of services, timeliness amongst others. These delivery services have operated for over 30 years and one must say they have gathered experience hence its success.
But that is where my challenge is comparing the above international giants delivery services to the local ones dotted all over the country. Ghana over the past years has seen a lot of delivery services springing up. Prior to putting together this write-up I counted about 30 listed on the internet and am sure these are just the captured ones.
Just like the earlier discussed business models, the local delivery services are just an off shoot of already existing ones. There is little innovation from new ones that join the fold. In my quest to research into their activities I spoke to a friend who runs a delivery service and belongs to a delivery association (National Courier Association of Ghana). I noticed that it’s indeed a budding business model with challenges.
Yes, they provide a service. There are however no attempts to niche the market especially and to stand out for a particular market. Hence the industry isl be flooded with mediocrity. Most of these delivery services transport everything and anything from food, stationary, electronics, Jewelry etc. Food for example I believe should come with a particular form of handling and I find it difficult been transported by just any courier service.
Conclusion; be innovative to remain in business
Ghanaian businesses should take time in the incubation stages of business model. There is a need to stand out in today’s competitive business world rather than doing what is already in existence. Innovation must be key in the rolling out process in order to attract and keep a certain class of customers. This helps in creating loyal customers who sees you as the first point of contact. For example, knowing how well you handle bottles of perfume during delivery.
There is nothing new under the sun, however creativity does lead to a stand out brand especial in a clustered business environment as seen in Ghana.
WRITER’S BIO
Albert Agbenyegah is a writer with an eye for excellence. He has obtained formal education in the skill of writing from the Ghana Institute of Journalism. He takes time to produce well researched write ups. He believes in the power of communication and advises that, it should be done by professionals no matter which form it comes in, least it becomes destructive.
He sees usually the business side of daily human engagements and seeks to throw spot light on them with the hope that, business oriented individuals will build on it. He writes usually from an editorial perspective but he follows keenly the trends in the business world.
His philosophy in life is that, anything that is worth doing is worth doing very well.
