/ 6 November 2014

Spazas: Talking shop is good for business

Service delivery protests in Roodepoort has left one person dead after an altercation with the police.
Service delivery protests in Roodepoort has left one person dead after an altercation with the police.

You have said several times that South African spaza shop owners should learn from their foreign counterparts. Why?
Let me tell you why they [foreign spaza shop owners] are better at running shops than the local owners – they have a great network system. And also that’s how they live. From the moment they are born, they are introduced to trade. Their mothers, uncles – everyone trades. They start at an early age.

The system of apartheid killed us black people. Those guys you were talking to say it was better during apartheid. That’s because there was no competition. There could only be a number of spazas in a section – that killed us. We were told not to trade and only a few would be allowed to do it. They didn’t learn the skill. There was no reason to be innovative, to learn different trading methods, to be cost-effective. You ran a spaza and people bought from you because they were forced to, not out of choice. 

They must ask themselves how can they [foreigners] be successful in the same communities [where] others [locals] claim they can’t succeed. I’m not talking about illegal immigrants or foreigners who trade without proper licences; I’m talking about legitimate foreign traders. How are they able to make it when our people can’t? It is because they know business. It is in their blood.

What do foreign spaza shop owners do differently?
These guys [foreign owners] come here and they network with other small business owners. They buy in bulk and support each other. Individuals don’t bulk buy; they come together, buy in bulk, get discounts and divide the goods among each other.

Two, they don’t sleep. They work hard and understand why they must work hard. They tighten their belts [and] they don’t spend the money. Everything goes back into the business.

Unfortunately for us, the impact of the apartheid regime will take a long time to undo, not just 20 years.

What advice would you give to South African spaza shop owners or informal traders?
Our people need to learn what other people are doing. They must ask themselves: How are they able to be successful in a space where we fail?

Then they must look, learn and do the same. They must do it; the government can’t, the ministry can’t. We can’t just give money away. We have no money to give.

We are not talking about people who are trading illegally, but the space on which I am focusing is “why are they successful and why are we not successful?”

We can bury our heads in the sand and not want to learn. We can say, “but they don’t pay taxes, they are here illegally, they must go back to their countries”, but, when they are here legally and are being successful, you must ask yourself why and how. This is a global world and South Africa is no longer cut off from it.

Do you have examples of what you have seen first-hand?
In Uganda, for instance, they have marketplaces where people share small stalls to save money. Go to Zim [Zimbabwe] and you will see informal traders coming together to bulk- buy and pay for one stand.

In the entire African continent, small business people come together to find a means to save.

Let us wake up to the reality of today to say how the wide world is operating. You have foreigners – how are they more successful when they operate in the same communities in which we fail?

In 2012, before the Mangaung conference, some ANC provinces proposed a policy that said foreigners should not be allowed to own spaza shops because their local counterparts were unable to compete. What are your thoughts on this?
I think we need a conversation as South Africans around that issue.

What are you going to do with the ones that are already here [legally]? Throw them in camps and say don’t make a living? They must make a living. The more they make a living, the more they contribute to the economy. They pay taxes and are active participants in the economy.

By allowing them to be immigrants you have given them a right to make a living. It’s a human right.

You have been in office for only five months but your department was able to ensure R400-million was paid to small and medium-sized businesses by defaulting government departments. How were you able to achieve that?
That money was always there and sitting in different government departments. We are looking at implementing sanctions on government departments that don’t pay small businesses timeously. They must be held accountable. As a ministry we need to make sure we implement this. We must teach government employees about the impact nonpayments have on the economy. We must give this a human face and say, when you don’t pay a small business, that employer can’t pay their employee and that employee can’t buy food, pay for school clothes or for transport.

I was brought up by a mother who was a domestic worker and she later became a trader. If she wasn’t paid, she would have never taken me and my siblings to school, she would not have paid for food, school uniforms and books and I wouldn’t be here. This is what I told Parliament. They need to understand the impact late payments have on people.

What about the perception that the department of small business development is a waste of government resources?
The ANC government took the decision to have the ministry because it was needed. They must understand the impact of SMEs [small and medium enterprises] over time.

If we can’t deliver, then we can’t be sustained. We must deliver, otherwise you can close down this ministry. The ministry was needed because of the weakness in the system.

How will your department deal with small-scale corruption?
Corruption is a disease that has plagued South Africa forever. It did not just come with democracy – it is just that now we can expose it.

Communities need to come together and fight [it].

We must engage at local level with the local government and change some of the regulations. Most of it was written during apartheid and the police sometimes use these old laws to take goods sold by hawkers, so we need to look at legislation.