Imagine you’re a retailer who wants to know the precise earnings potential of a new store in the Rosebank Mall in Johannesburg. Now imagine someone could tell you that you could expect to rake in R1,1m/day on average in sales. That level of accuracy sounds impossible, but it isn’t.
By combining census and municipal data, other historical data, and aerial photography and mapping tools, Johannesburg-based research and consulting company Fernridge is able to provide exactly this sort of information.
“We play in the retail and commercial property development sectors,” says MD Sybrand Strauss. “We assist clients in limiting their risk and help them make good business decisions based on good information.”
Fernridge, Strauss says, is not in the business of recreating the census but instead focuses on where development is happening. Its clients include most of South Africa’s large retailers and property developers. Two of its oldest customers are Spar and McDonald’s.
“We offer information about the potential of a catchment area and assess site access and other factors. This way we can tell whether or not a proposed site is a good one and what sort of income clients can expect to earn.”
Previously, this sort of information would require a dedicated report with costs starting at around R5 000. Last week, Fernridge launched a website to allow anyone to get access to data on a specific area at a lower cost.
“We’ve developed a new portal to lower the barrier of entry for this kind of data so that entrepreneurs and other independent businesspeople can get access to it,” says Strauss.
The new portal, called Africa Eye, allows users to locate the desired site, select the intended target market using retail categories, and get a comprehensive report using either census data or Fernridge’s own data. The former costs R100 and the latter R1 000, with each category type — grocery stores or electronics stores, say — costing an additional R80 each.
Strauss says Fernridge intends expanding the service to cover a wide range of African cities in coming months. “There are lots of sectors that could find this information useful beyond retail and property development. I’m sure there are some we haven’t even thought of yet ourselves.”
Fernridge is also moving into the business of vending data. Data centre GM Ilse van der Merwe says it’s selling raw data in geographic information system formats. “Some companies have their own internal research departments and want to buy the raw data,” she says.
Fernridge claims it is able to get accuracy in terms of predicting client income to within a 5% to 10% range. “We’d rather be 10% under than 5% over in our estimates,” says Strauss. “We provide a bankable document that people make big decisions on, so you don’t want to overestimate.”
Of course, Fernridge’s data only offers information on demographic potential and Van der Merwe says other factors, like parking or product availability can also influence the success of a business.
“We had an instance where the operator of a business had a criminal record and the community boycotted him,” says Strauss. “Those are things we can’t predict.”
Although Fernridge is based in South Africa, it is venturing into other African countries. The company now has data for 65 African cities and roughly 7m households beyond South Africa’s borders. — (c) 2012 NewsCentral Media
