One small corner of the retail market is seeing business as usual at this time of year. Wholesale markets providing goods to informal traders, spaza shops and small businesses across South Africa are booming.
Trade unions would blow a gasket if they went shopping on the outskirts of the Johannesburg CBD where developments such as China Mart, Dragon City and the African Trading Centre provide goods ”off the boat” from China. And if a Tuesday morning’s trade at Dragon City is anything to go by, assertions that traders make hundreds of thousands of rands a day do not seem so far-fetched.
Dragon City’s parking is a nightmare. Vehicles of every description cram the lot and shop assistants with trolley-loads of merchandise pack the waiting cars, bakkies and trucks with goods. Most of the product lines are in clothes, shoes and fashion accessories, but there is also fresh produce, linen and home accessories on sale.
The sprawling complex on the corner of Main Reef and Park roads in Fordsburg has mushroomed to the plot of land opposite the main depot, to what is known as its ”phase three” complex, accommodating another 130 shops. Including its older phase one and two complexes, the centre now contains nearly 400 shops.
”This is a wholesale distribution centre for all merchandise from China,” says Jensen Zhang, manager at Dragon City.
Zhang says the majority of customers are Chinese people, who buy goods for stores around Jo’burg, as well as shops across South Africa, particularly rural areas. Indians, Pakistanis, North Africans and South African formal and informal traders also make up a large portion of the clientele.
The busiest parts of Dragon City — its phase one and two complexes — are sought-after retail property spots. Stands can be rented from R100 a square metre. They are sold for about R12 000 a square metre, but Zhang says no stores are available. Many Chinese entrepreneurs have bought stands in the new development already, which they in turn lease to other traders.
The new complex, open for just a month, sports newly stocked shops or empty ones papered with ”to let” signs in their windows.
Imran Khan, a store owner in the new centre, says trade is slowly picking up. ”Let’s see about Christmas,” he says. ”This week we couldn’t get good business, but sometimes it’s busy, sometimes it’s slow.”
The retail centre also acts as a small cultural hub for many Chinese immigrants. Here they can buy Chinese groceries, from rice and tea to frozen fish, as well as a range of Chinese newspapers and magazines, such as the Hong Weekly and China News SA, published locally.
Despite the cheap price of goods, the furious movement of bulk merchandise means that the centre operates at about a R5-million turnover a year.
”But most of the business goes to the individual store owners who can make hundreds of thousands a day,” says Zhang. ”Sometimes a bedding store can sell whole containers [of stock] in a day.”
Goods bought in bulk here go for double, ”sometimes triple”, the price in larger retail outlets, says Zhang. A glance into a linen shop confirms as much. Embroidered single duvet sets go for as little as R45.
Most of the goods arrive in huge containers at Durban’s port. A single container can cost as much as $3 000 to ship and the goods are then taxed according to the stock, he says.
Zhang says that some shipments come in through Maputo, travel through Zimbabwe or Mozambique, and even go as far as Namibia, to try to avoid the ”stricter” port authorities in Durban. But, he says, a great deal is being done to combat illegal and counterfeit goods. ”You can trade anything you like here, as long as it’s legal.”
Store owners and tenants must sign contracts that include provisions preventing the sale of smuggled or fake merchandise. ”We don’t want to bring trouble in,” he says.
Keeping trouble out is something the centre battles to do. Crime is a problem. Prevention measures come in the form of armed security guards posted at every entrance to Dragon City. Guards lurk above the parking lot, using the shells of old containers as vantage points. Centre management even enlisted police reservists to help protect the premises.
”Chinese people are a target for crime,” says Zhang. With added security measures, assailants simply wait until traders leave the premises to attack them, says Zhang.
The fact that the majority of transactions are done in cash doesn’t help, but centre management is trying to encourage the use of cheque and credit facilities to try to curb temptation, says Zhang.
Still, it seems little deters ongoing trade here. Come thieves or high water, while there are willing buyers there will be willing sellers.
