In Sierra Leone, goods are distributed from the manufacturer through wholesalers to retailers, though some manufacturers do sell directly to retailers and some wholesalers sell directly to consumers. Generally, wholesalers import goods in bulk from the manufacturers, clear them through customs, and transport them to their stores or storage facilities, from which they distribute to the retail market. Some wholesalers operate both as wholesale and retail, with chains of small shops serving as retail outlets, including supermarkets.  There are some local and national distribution and courier companies which provide delivery and logistics services.

The main seaport, Queen Elizabeth II Quay, is the country’s most important gateway for trade and commerce.  The Freetown International Airport also has several direct flights to and from countries in Europe, the Middle East, and Africa. The official public road network totals about 11,000km.  

Using an Agent or Distributor

Caution must be exercised when hiring the services of a local business to serve as a partner, agent, or distributor in selling U.S. goods or providing U.S. services to local retailers or consumers. A legal representative is recommended to observe the country’s legal and regulatory requirements and to ensure the partner, agent, or distributor is reliable and has the resources to perform the service. U.S. Embassy Freetown is a Partner Post providing fee-based services to help U.S. companies identify and evaluate suitable partners, agents, or distributors in the country. The Gold Key Service or International Partner Search can assist U.S. businesses in identifying legitimate prospects to serve as local partners, agents, or distributors.

Establishing an Office

All formal business entities require a legal registration and a business license to operate in the country. Businesses can register as sole proprietorships, partnerships, or limited liability companies. Sole proprietorships and partnerships register with the Office of the Administrator and Registrar General (OARG), while limited liability companies register with the Corporate Affairs Directorate (CAD) of the National Investment Board; both entities provide online registration on their websites. The procedures for registering a business have been reduced to five steps and the time to an average of eight working days, including submission of the company registration form, a check on the uniqueness of the company name, registration of the company with OARG or CAD, issuance of the certificates of incorporation and registration, a taxpayer identification number (TIN), National and Social Security Insurance Trust (NASSIT) certificate, and a municipal business license, and finally the creation of a company seal. The business must later register the company’s employees with NASSIT by completing an application form at the NASSIT office. Foreign companies are not required to open an office in Sierra Leone but must formally register their business and indicate a local address.  

For the latest Investment Climate Statement (ICS) which includes information on investment and business environments in foreign economies pertinent to establishing and operating an office and to hiring employees, visit the U.S. Department of Department of State’s Investment Climate Statements website.

Franchising

Franchising is not a common business practice in Sierra Leone. U.S. Embassy Freetown is unaware of any U.S. firm franchise arrangements in the country. However, the Government of Sierra Leone has indicated that it would welcome U.S. franchises in the country, especially well-known fast-food franchises.

Direct Marketing

Direct marketing is an uncommon business practice in Sierra Leone. The lack of the necessary infrastructure, such as an effective transportation system, good road networks, a reliable postal service, sufficient internet penetration and access to reliable electricity, in combination with low literacy rates, makes the practice challenging. However, radio, television, newspaper advertisements, and billboards are commonly used methods.

Joint Ventures/Licensing

To promote technology and knowledge transfer and improve local content, the government of Sierra Leone promotes joint ventures between foreign and local businesses where foreign businesses are encouraged to extend 20 percent of holdings to indigenous businesses. Foreign businesses that partner with Sierra Leonean businesses are offered a preferential margin in government and private procurements, and joint ventures can also facilitate access to land which can be a challenge for foreign investors. The Office for Public-Private Partnership manages joint ventures between the government and foreign investors. Licensing agreements are rare in Sierra Leone.

Due Diligence

U.S. businesses interested in doing business in Sierra Leone are advised to perform appropriate due diligence on prospective partners, agents, and distributors and to hire the services of an attorney or accounting firm. U.S. Embassy Freetown does provide fee-based commercial services, including International Partner Searches and International Company Profiles to provide additional background information on prospective partners.