South Africans have always extended a warm welcome to our compatriots from other parts of Africa, mainly in appreciation of the role these countries played in assisting us achieve our transformation to a democracy free of domination by a minority.
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However, as the economic cycle, and other self-inflicted actions (corruption, political instability) continue to impose real hardship on the majority of the populace, this welcome appears to be wearing thin…nowhere is this more obvious than in the vocal and often violent opposition being shown to the ‘takeover’ of our township economies by foreign nationals. As Ferial Haffajee points out in her recent article in Business Times: ‘Black South Africans are being squeezed out of the only economy they truly owned’.
Business sense
While it is convenient to attribute the apparent success of these foreign owned businesses to non- compliance with labour, tax or other regulations, it is clear, as Haffajee illustrates as well, that they are bringing a superior skill set and ’smarts’ to running their enterprises. These include group purchasing power, credit extensions and superior marketing and merchandising.
The stage is set for violent confrontation if urgent and appropriate measures are not taken by all stakeholders. This is underscored by the recent ultimatum delivered by business associations in the north of Durban to foreign owned shops to cease trading with immediate effect.
Way forward
Some of the measures to be considered are:
Ways to expand the township economy to create space for new entrants without compromising existing operators
The enforcement of regulations and compliance to assure locals that foreign owned businesses are competing with them on a ‘level playing field’
Promotion of partnerships for transferring of skills between township operators
Upskilling of township business owners to meet the competition.
At the same time, local business owners have to confront the reality that the paradigm of a captive township customer base is over, and they have to up their game in terms of service, price and marketing to keep their slice of the pie.
After matriculating, Vijay Naidoo studied Economics in the UK. Upon his return, hejoined the family construction business as MD for 10 years.
He subsequently joined his sister in their furniture manufacturing business as director for quality assurance and operations. He was responsible for all quality aspects of their products, and led the project to the business achieving an ISO 9000 quality accreditation. As an export focused business, this was important for our international competitiveness.
Mr Naidoo has an abiding interest in quality management and productivity improvement, particularly in manufacturing.
More recently, he has focused a lot of his time on giving back to the community by way of mentorship of small businesses and sitting on the executive of the South Coast Chamber of Commerce. He also sits on the Board of the Ugu South Coast Development Agency.
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