Two Bits – Profits walking out the door

The Ilembe Chamber of Commerce’s new president, the affable Xolani Gumede, has set a high bar for his year as the chair of the business group. To have real meaning, he told the Chamber’s annual gala dinner at the Fairmont last week, it had to be relevant to really small businesses, including informal traders and the like.
It will be relevant in the lives of ordinary people.
Gumede is the owner of Cappenny Estate, the strawberry farm at Compensation, who together with his dynamic wife, Xoliswe, has turned what might first have appeared a slightly crackpot idea into a bustling industry.
It was his first appearance on a public stage since taking the Chamber chair, so his vision that the organisation which exists almost solely thanks to the financial support of formal business should reach out and become relevant to the little guy, is worth watching. Of course, the Entrepreneur programme has drawn its entrants almost entirely from that band of beginner businesspeople but it is fair to say that the Chamber’s name is not on everyone’s lips outside formal businesses as the go-to place for help in the workplace.
Former Mpumalanga premier and now presidential hopeful Matthews Phosa was supposed to have been the guest speaker at the dinner, but he cancelled at the last minute, citing family reasons. Chamber CEO Cobus Oelofse whistled up Durban high flyer Terry Rosenberg, who proved to be a very able replacement off the bench. Terry has sat on the boards of a whole raft of companies, including Anglo American, and is chairman of a big deal investment company Oakbrook Holdings (not to be confused with Oakbay, the one owned by the Guptas!) that is developing the R1.4 bn Umhlanga Arch. He’s also a product of Marist Brothers like so many North Coasters, so he’s a survivor!
He said to succeed in business you needed two essential ingredients: vision and preparedness to take risks. Translated, if you have a dream and are convinced it is going to work, be prepared to put everything on the line (including your house) to make it work. And be prepared to get your hands dirty.
He told an interesting story of when he was involved in running Game stores in the 80s. Game set the cat amongst the pigeons back then with its business model of high volume, low margins.
“We were operating at a 2% margin and discovered that the shrinkage was 2.5%. That was not good. So I moved my office down into the foyer of the store so that I could see everything that was going on. What I discovered was quite horrifying – and don’t think it was the usual suspects who were stealing us blind. Colour had nothing to do with it.”
One day he noticed a shopper wheeling out a luxury fridge and asked to see the paperwork. Everything checked out, but in a moment of inspiration he asked to look inside.
“Then the performance started. No, it was locked and they couldn’t find the keys, and so on. Eventually we got a locksmith to open it and what did we find? – R15 000 worth of CD equipment!”
He urged businesspeople to have confidence in their country, in spite of the political noise at the moment. “The country is 20 years old – what do you expect of an adolescent?” he asked, only half jokingly.
People should develop a filter for the bad news being punted by the media, he warned. Too much bad news encouraged people to pack for Perth. Though I’m very glad to say that he gave The Courier special mention as not being amongst the bearers of gloomy and fake news. “We all know Bruce doesn’t do that!”
Thanks Terry, you’ve done wonders for my shares!
He did give the gathering an insight into where he is putting his money these days. Apart from the Umhlanga Arch development, he said he was investing heavily in ‘fintech’, which is businesses that use new technology, like cell phones, to compete in the marketplace of traditional financial institutions. Cellphone banking, that sort of thing.
“We think it’s going to be the facilitator for small and medium enterprises to get into doing business properly, because the problem for them is that they are not bankable; they are not large enough to get support from traditional banks. We think this is going to be very big.”
The buzz and vibe of the evening was great, buoyed by the turnout of businesspeople of all races in a super friendly atmosphere. The food at Fairmont was exquisite as always but the only low point was when my table companion, Andy Horton, and I offered to buy the wine. We’re also Marist Brothers products so we know our way around a rosary – and boy did we need them to pray we had enough money in our wallets when we got the bill. R630 for two bottles of very ordinary white wine! C’mon guys, that’s not right! And to add insult to injury, a waiter whisked away Andy’s half-finished glass when he wasn’t looking!
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Two owls are playing in the final of the Owl Pool Championship. It comes down to the last frame. One of the owls is just about to play his shot, when his wing accidentally touches a ball.
“That’s two hits,” says the other owl.
“Two hits to who?” asks the first.