/ 5 August 2005

Deal with the truth, says Pick ‘n Pay CEO

“No, I would not,” Pick ‘n Pay CEO Sean Summers answered adamantly when asked whether he would have joined recent strike action if he were an average worker in his company.

When I met Summers earlier this week, he appeared friendly and approachable. He fetched me personally in the reception area, offered me something to drink and even poured it for me before the interview began.

His office was immaculate and on the wall behind his desk hung a Ferrari jacket along with other framed Ferrari memorabilia.

Summers has led his company through two major crises: the poisoning scare in 2003 and this year’s massive, 11-day strike, which cost the company R73-million.

“The fact that Pick ‘n Pay [employees] were not at work and were on strike does not mean that they supported it,” Summers said.

“I’ve had staff calling me up and telling me they found it equally humiliating and embarrassing, as we did. They didn’t want to get involved in the strike.”

He said that one of the reasons why Pick ‘n Pay can afford to pay high wages is because it does “significantly high turnovers per quarter”.

“We had R322 on the table unofficially, and that was rejected. What is the sense of an 11-day strike? Sadly, these things are not about the money.

“There’s justifiable cause for concern. We need to elevate ourselves beyond the rhetoric.”

Summers’s involvement in the company stretches as far back as 1974, when he joined Pick ‘n Pay as a trainee manager. He moved to the Hypermarkets team in 1979 and became general manager of Hypermarkets Foods in 1985. By 1993, Summers was deputy MD, and in 1998 he was appointed group MD. In 2001, he finally took over the reins from Raymond Ackerman.

Pick ‘n Pay is one of the highest-paying employers in the country, and offered its workers an increase of more than the inflation rate.

“We pay our staff significantly more than our direct competitors — a minimum of R500 a month more,” said Summers, also pointing to the company’s “increasing significant-benefits packages”.

He said many workers lost their monthly wage because of the strike.

“We have workers who have dependents, and this kind of loss [to Pick ‘n Pay] is significant to them,” he said.

He added: “I’m not quite sure what the message is that the [labour] representatives are trying to give. I do not believe that they have done an adequate job of preparing their members for a low, single-digit inflation environment — they have not worked out a strategy for this.

“That [striking for higher wages] is just a device to get away from the issue at hand. That’s just the rallying point.”

Summers thinks the strike was “actually not about the wages”.

When one looks at all the strikes that are erupting at present, such as the municipal strike, the South African Airways strike and others, “it’s like silly season”.

“It was upon us as the leadership that [the strike] was brought to an end. I think it’s doing enormous damage to the image of this country both internally and externally,” said Summers.

Last year, television investigations programme Carte Blanche looked at the retail industry, saying that even with interest rates remaining steady and inflation coming down, shoppers were still not getting more for their money.

Summers explained rising food prices by saying: “We have to look at this thing on a broader basis and not just purely on the cost of goods.”

He emphasised that one must take into account manufacturers and their costs.

“We work in a low profit margin,” he said, and joked that he would like to have the type of profit margins that M-Net has.

A statement released by the South African Commercial Catering and Allied Workers’ Union as the strike neared its end stated that its members’ rights were “being infringed, through the management and police collusion that resulted into our members being … called ‘stupid kaffirs'”.

Summers disagreed, calling the statement one of “the most bizarre piece of comments ever”.

He said the document depicts the union’s members as the “sweetest little choir boys and girls”.

“We have hours of closed-circuit footage that [will prove] that that’s an absolute lie. Lots of the staff were not in this thing with their heart.”

He was adamant that no worker was called a “stupid kaffir” by anyone.

During the strike, some Pick ‘n Pay stores were barricaded and customers were prevented from entering.

“What level of behaviour are we actually coming down to? It would be a gross injustice for like-minded, civil-minded people who love what they do, to characterise all of our people by the reprehensible acts of a small minority,” said Summers.

He added: “We are just so ashamed of this. Ninety-seven to ninety-eight percent of this company is good and great. Ultimately, the company will do what they want. We live in a free, democratic country. We are not perfect. We deal with it.”

Last year, Pick ‘n Pay was ranked second in the South African category in the Financial Times/PricewaterhouseCoopers survey of the world’s most respected companies.

Summers was named the Business Times Business Leader of the Year for 2003 as well as last year’s Moneyweb CEO of the Year. He attributed his inner strength and tactics of becoming a successful businessman to “dealing with the truth”.

“Deal with the truth and the simple facts. It may not support your argument, your prediction or your point of view. Somehow, I look past these floating distractions. I’ve met very few people in my life or on an individual basis that are not positive.”

Black economic empowerment projects that the company is currently working on include deals with “suppliers, farmers and bakeries”.

Regarding the workers, however, Summers said there is “nothing specific that we’re working on at this stage”.

“In terms of the wealth created in the company, it’s given back to the workers in terms of remunerations and benefits,” he said.

When the interview came to an end, Summers was walking me back to the foyer when we bumped into a cleaner in the corridor.

Summers stopped and engaged in a short conversation with the man. I noticed how happy and content the worker seemed, compared with those who were striking for better wages just a few days earlier.