There is hope for the trou­bled lo­cal tex­tile in­dus­try as wool man­u­fac­tur­ers ex­pe­ri­ence a turn for the bet­ter

CityPress - - Business - ANDILE NTINGI busi­ness@city­

For nearly 20 years, tra­di­tional beer maker United Na­tional Brew­eries has cut a for­lorn fig­ure as the only in­dus­trial in­vestor in But­ter­worth after the Eastern Cape town was de­serted by more than 40 large-scale man­u­fac­tur­ers in the mid-1990s. The town’s two-decade in­vest­ment drought came to an end in Fe­bru­ary when the once-thriv­ing in­dus­trial town wel­comed a tex­tiles man­u­fac­turer, rais­ing hopes that the in­vest­ment could help But­ter­worth re­claim its for­mer glory.

The wool pro­cess­ing fac­tory, known as Ivili Loboya, is seen as a boon for thou­sands of wool sheep and goat farm­ers in the prov­ince, who will now have a new, re­li­able cus­tomer to sell their pro­duce to.

The plant will be the first com­mer­cial cash­mere­pro­cess­ing en­ter­prise in South Africa and will also source mo­hair, silk and cot­ton from farm­ers.

It will then turn th­ese into ei­ther scoured wool or high-end fab­rics for the dé­cor, up­hol­stery, and fash­ion ap­parel mar­kets in South Africa and Europe.

There are 3 mil­lion sheep in the Eastern Cape with 19 000 small-scale wool farm­ers, who gen­er­ate in­come that sup­ports 100 000 fam­ily mem­bers.

For­mer chair­per­son of the SA Post Of­fice Vuyo Mahlati is the woman be­hind the wool pro­cess­ing fac­tory.

Mahlati and other in­vestors have in­vested R30 mil­lion in the ven­ture, which is 100% black owned. The ma­jor­ity of the shares in Ivili are held by women. The tex­tiles man­u­fac­turer has a col­lab­o­ra­tion agree­ment with the CSIR, which acts as the fac­tory’s re­search and in­cu­ba­tion part­ner that pro­vides ex­per­tise in nat­u­ral-fi­bre pro­cess­ing for new and in­no­va­tive prod­ucts.

The fac­tory of­fers wool sort­ing and scour­ing, fi­bre man­u­fac­tur­ing and hand-spun yarns, and it sup­plies in­su­la­tion and in­ner soles for safety shoes.

De­spite its strong de­vel­op­men­tal im­pact, the plant has not yet re­ceived fund­ing from gov­ern­ment’s Black In­dus­tri­al­ists Pro­gramme (BIP), al­though gov­ern­ment stated in 2015 that it would set aside R23 bil­lion to sup­port black in­dus­tri­al­ists such as Mahlati and many oth­ers with am­bi­tions to en­ter the man­u­fac­tur­ing sec­tor.

“We ap­plied im­me­di­ately after the an­nounce­ment [of the BIP] and we hope our ap­pli­ca­tion will be favourably con­sid­ered. It seems the process for eval­u­at­ing ap­pli­ca­tions is long, but we will re­main pa­tient,” says Mahlati, who is pres­i­dent of the African Farm­ers’ As­so­ci­a­tion of SA.

Mahlati points out that ca­pac­ity build­ing should be pri­ori­tised at all lev­els of the pub­lic sec­tor, par­tic­u­larly mu­nic­i­pal­i­ties and de­vel­op­ment fi­nance in­sti­tu­tions that are sup­posed to be at the fore­front of ser­vice de­liv­ery. Reg­u­la­tory headaches aside, she is ex­cited about the prospect of play­ing a role in the at­tempts to re­vive the South African cloth­ing and tex­tiles in­dus­try, which was an­ni­hi­lated by an in­flux of cheap im­ports, no­tably from China, that led to the clo­sure of fac­to­ries and thou­sands of job losses. But­ter­worth was not spared the carnage as it too lost its cloth­ing and tex­tiles fac­to­ries. The in­dus­try’s work­force de­clined to 80 000 work­ers in 2013 from around 181 000 in 2002. How­ever, the in­tro­duc­tion of the Cloth­ing and Tex­tiles Com­pet­i­tive­ness Pro­gramme, an in­cen­tive scheme of the depart­ment of trade and in­dus­try, in 2010 sig­nif­i­cantly re­duced the haem­or­rhage to a point where 25% to 30% of lo­cally sold cloth­ing is now man­u­fac­tured do­mes­ti­cally. Ivili’s lux­ury fab­rics will be sold un­der the Dedani Col­lec­tion brand. In the next five to 10 years, the in­vestors of Ivili plan to ag­gres­sively ex­pand the busi­ness while push­ing prod­uct in­no­va­tion and boost­ing the in­comes of farm­ers. “We in­tend to make [Ivili] a pub­lic com­pany on the stock ex­change where own­er­ship is broad­ened to be truly in­clu­sive,” prom­ises Mahlati. The fac­tory will not only cre­ate jobs in the ru­ral Eastern Cape, but will also help South Africa earn for­eign cur­rency as some of the pro­cessed wool and lux­ury fab­rics are go­ing to be ex­ported over­seas. Ivili has al­ready signed an agree­ment with an Ital­ian agency and re­tailer that will dis­trib­ute its fab­rics in Europe. Jeff Radebe, min­is­ter in the pres­i­dency, who de­liv­ered a key­note ad­dress at Ivili’s launch, said man­u­fac­tur­ing ven­tures such as Ivili were ideal mod­els for sus­tain­able en­trepreneur­ship. The re­vival of the lo­cal tex­tiles sec­tor has re­duced the quan­tity of South African wool that is be­ing ex­ported to over­seas mar­kets. At one point, when the lo­cal tex­tiles in­dus­try was on its back foot and very lit­tle wool value-ad­di­tion was tak­ing place in South Africa, the coun­try ex­ported 98% of its wool, com­pared with 90% cur­rently. Mahlati says But­ter­worth was cho­sen as the site for the fac­tory be­cause it is close to wool farm­ers and the lo­gis­tics in­fra­struc­ture in the area is ca­pa­ble of sup­port­ing the plant, which is about 100km from East Lon­don’s air­port and har­bour. “The size of sup­ply is de­ter­mined by the mar­ket and goes be­yond the Eastern Cape, with some wool sourced through agents. There are also di­verse breeds of wool that we source. “Black and coloured Merino wool and Karakul are in de­mand for the non-wo­ven prod­ucts. We also use white wool for our blends in tex­tile prod­ucts,” says Mahlati. Ivili Loboya has de­vel­oped an app that sources wool from farm­ers, and more than 500 goat farm­ers are us­ing the app to sup­ply the fac­tory.

– Fin­week

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