The theme that emerged from all the speakers on the panel was that sustainability of any new business venture set up to take advantage of the football world cup is crucial. The four weeks of the event itself should be viewed as nothing more than the platform to get a business off the ground; before and after the event are actually more significant than the event itself.
There is a great risk that many people will invest large sums in businesses that focus purely on the event itself – they could end up losing all they've invested, if they don't plan for how the business can keep going in the future. As Brian Joffe, chief executive of Bidvest, put it, “The games themselves will be very expensive and highly competitive for business people, so it won't be easy to make money around the games.”
Having said this, prospects for entrepreneurs abound, but one must have a wider view than the event itself. At this stage, planning is core, and part of the planning involves building relationships and setting up partnerships that will help your business to keep going beyond 2010.
The Don Hotel Group, for instance, has been actively working on relationships with international tour operators after it opened a specific department two years ago to make contact with these businesses. The importance accorded to this department by the company is evidenced by the growing size of the department – recently, French- and Portuguese-speaking staff were added to the staff complement to approach tourism operators in French-speaking Africa, Canada, France and Angola, as well as Mozambique and Portugal.
Relationships can also be built with potential business partners who have nothing to do with the 2010 FIFA World Cup event. South African businesses exporting to countries in Africa should use the event to meet up with counterparts from potential new markets on the continent.
Gary Bailey, former Manchester United goalkeeper, suggested that local business people invite business leaders from countries such as Cote d'Ivore – a country we may not yet be trading with but one which may be an attractive option. “The love of the game of football will bring these people to the event, and it creates a great opportunity for you to meet them and start doing business,” Bailey explained.
Entrepreneurs should also look for suitable existing businesses they can partner with. An existing transport business can share knowledge about routes, for instance, and the existing business will benefit from the capital equipment that a new player may bring to the partnership. In crunch times, such as during the 2010 event, access to extra resources will help both parties deliver.
Sean Temlett of the Wits Business School gave a practical example of this: Netflorist failed to deliver properly one Valentine's Day, after having been inundated with more orders than it could cope with. Learning a lesson from this, it subsequently partnered with florists all round South Africa. While its revenue per sale went down, access to the market throughout the country via a comprehensive network of florists expanded its business. It also improved its ability to deliver successfully.
Identifying a suitable business opportunity is an important factor in achieving success. According to Temlett, one should not go for the obvious things, such as offering a taxi service or providing extra security guards for the duration of the event. “Rather consider adjacent industries, where the barriers to entry may be higher but then the competition will be correspondingly less severe. Examples of this would be to look at the transport industry from the point of view of providing outlets for the servicing of vehicles, training additional drivers and investing in vacant land to provide parking.”
Ultimately, the 2010 FIFA World Cup provides numerous opportunities for businesses in South Africa. The long-term benefits for the country are substantial and are part of the planning by FIFA and its authorised representatives. This is clear from the fact that large numbers of the 3.2-million tickets for the games will be bundled with other travel services to be sold by foreign tour operators.
“This is an important move in creating sustainable foreign tourism to the country,” explained Jaime Byrom, the CEO of Match, which has been appointed as the official body to handle accommodation and ticket distribution for the event. Joffe, too, is upbeat about South Africa's future and sees the 2010 event as part of the positive future we have here.
