African Entrepreneurship: Weighing Adventure Travel Business Opportunities

It was June 2021 and the international tourism industry was beginning to show signs of revival after the COVID-19 global pandemic. Small business owner Tony Byarugaba was surveying the scenic grounds surrounding his tourist lodge in Uganda. Byarugaba had built his enterprise by offering international clients a superior African vacation that included Uganda and the neighbouring countries of Rwanda, Kenya, Tanzania, and the Democratic Republic of the Congo. From his beginnings as a self-taught tour operator, Byarugaba had diversified into the hotel business. His two early-stage companies, Mamaland Safaris and Woodland Lodges, had already survived very tough times—a global recession, the outbreak of Ebola, and, most recently, the pandemic.<br><br>Byarugaba now had to weigh the potential risks and rewards of a number of options for ensuring the growth and stability of his businesses. As a small entrepreneur with limited access to capital and labour, he could only afford to choose one direction to pursue. The future of his company depended on making the right choice.<br><br><p><p align="center"><b>This case was the first prize winner of the 2022 John Molson Business Ownership Case Writing Competition.<b/><p/>

This case provides the opportunity to practise concepts already covered (e.g., Porter’s Five Forces; global, demographic, political and legal, economic, socio-cultural, and technological [GDPEST]; valuable, rare, imitable, and organization [VRIO]; and generic strategy) while introducing the many factors shaping the strategic decisions around growth for an early-stage company with limited resources. After working through the case analysis and making strategic recommendations, students should be able to do the following:<br><br><ul><li>Understand the pros and cons of being a small business owner in a niche market trying to expand in an established industry.</li><li>Determine what steps companies take to gain or maintain a competitive advantage in current and new locations.</li><li>Explore how to identify market opportunity in the tourism industry using Porter’s Five Forces and global, demographic, political and legal, economic, socio-cultural, and technological (GDPEST) analysis to develop a market entry strategy.</li><li>Apply a VRIO (valuable, rate, imitable, and organization) analysis to identify competitive advantage.</li><li>Understand the impact of generic strategy on market positioning in a dynamic environment, taking into consideration the needs of the target audience to determine business viability.</li><li>Determine the options for expansion: joint venture, wholly owned, geographic saturation versus regional growth, vertical integration, and so on.</li><li>Weigh the opportunity costs and benefits to determine the optimal growth option.</li></ul>

• Business Strategy
• East Africa
• Travel and tourism