A passion for creating jobs
With two busy seaports, a huge potential workforce and amazing possibilities for entrepreneurs, KwaZulu-Natal is open for business. Yvonne Grimbeek speaks to the Industrial Development Corporation’s Pat Moodley about their work in the province
Pat Moodley is passionate about shoes and fabric because they create jobs. Moodley is the regional manager of the Industrial Development Corporation (IDC) in KwaZulu-Natal and while footwear and fabric are among his passions, his biggest motivation is a passion for his province to succeed. The KwaZulu-Natal IDC office is one of the most successful regional offices in the country. The office is the second-busiest office in terms of transactions, beaten only by the corporation’s head office in Johannesburg.
Opportunities for entrepreneurs
KwaZulu-Natal is truly the province with all industries, and the IDC in the region tries to capitalise on this.
“This is a diversified province that comes with a number of industries, from textiles, agro-processing, tourism, chemicals to the automotive industry,” says Moodley.
One of the province’s biggest economic drivers is the Port of Durban, which is the largest in the southern hemisphere and among the top 50 busiest ports in the world.
There is also a seaport at Richards Bay, and these two ports make it attractive to potential import and export entrepreneurs.
“Also, don’t forget the weather – it’s very good,” says Moodley.
Challenges to overcome
“The IDC’s mandate is to create jobs and we need to fund more businesses that do just that.
“Clothing and footwear are two areas that have low capital expenditure, but high job creation,” said Moodley.
“My responsibility is to find these businesses so that we can fund them and increase the IDC’s footprint and to stimulate the economy.
“We proactively go out to meet with stakeholders. I look at what the opportunities are and then try to get all the stakeholders [government and industry] together to capitalise on these. We also involve other financiers because together we can make it work.”
The KwaZulu-Natal office’s success grows out of the relationships it has forged with government, private businesses and clients since its inception. One of its more valuable partners is in the South African retail space. Because of this partnership, a number of the IDC’s textile clients have become suppliers to a South African retail clothing giant.
The work the KwaZulu-Natal IDC office has put into its relationships has not gone unnoticed.
In 2013, the office received the Partnerships Award at the FNB KwaZulu-Natal Top Business Portfolio Awards. It won alongside major corporations such as Tongaat-Hulett, Mr Price and Corobrik.
We go back to shoes and textiles, because these are the projects that lie close to Moodley’s heart.
While South Africa’s textile industry has seen a significant decline since the early 2000s as a result of increasing global competition, government, in collaboration with the IDC, is trying to resuscitate this jobs-rich industry.
“Textiles, clothing and footwear are my passion. It is heartwarming to see our investment create permanent jobs.
“If one person has a job, you are feeding five to seven people per household.”
One of the reasons textiles has had a resurgence in South Africa is because imports from the East are no longer cheap.
Production costs have increased and the turnaround time for high fashion items can be anything up to three months, and local retailers want it faster.
“Local manufacturers can respond more quickly to these high fashion requirements, and their turnaround is much quicker.”
Moodley says large companies are tending to move to locally produced goods if the quality and price are right.
“If South African consumers were more conscious about buying local, it would have a major impact, we would create more jobs and the standard of living would go up.”
An example of the IDC’s commitment to the textile industry is Mahlongwa Clothing Industries (MCI).
Situated in Umkomaas, a rural area on the South Coast of KwaZulu-Natal, MCI is a family-owned business that was established in 1986.
The firm is a supplier of a full range of products, including workwear, corporate wear and personal protective wear to government departments and parastatals.
MCI approached the IDC for funding at a time when the business decided to move from a cut-make-and-trim operation to a fully fledged factory.
In 2014, MCI – through the IDC – was granted funding under the Production Incentive Programme.
This programme funds textile businesses to invest in new technologies and equipment to achieve higher efficiencies.
Eresh Bhoora, CEO of MCI, said this much-needed financial injection has opened up more business opportunities for MCI, and it has been able to use the funds for the procurement of more raw materials, trimmings, employment of new staff and the maintenance of a good cash flow.
Kwazulu-Natal is one of three provinces that account for the lion’s share of activity in South Africa’s textile industry.
The KZN Clothing and Textiles Cluster estimates that the industry accounts for between 60 000 and 80 000 jobs.
MCI is the third-biggest employer in the Umkomaas area and its surrounds.
“Before the IDC funding, we had about 130 staff members. We now employ around 180 people and hopefully, as we start growing, we will increase this number,” said Bhoora.
Agro-processing is another area of focus for the IDC in KwaZulu-Natal, and their involvement with Ethekwini Cheese – a start-up entity that was set up in 2016 by the Dixon family to manufacture value-added, innovative substitute and functional cheese products – is one of many exciting new projects for the corporation.
The shareholders of Ethekwini Cheese are Simon and Anthony Dixon and Ntombizodwa Cheryl Cagi. The company is the only one of its kind in South Africa to make this type of cheese.
The difference between natural cheese products and cheese substitutes is that vegetable oil is used for substitute products as an alternative to butter fat.
The Dixon family has extensive experience in this market, which has led to the decision of establishing a manufacturing plant.
Part of what they are passionate about is the empowerment of local workers, especially women, and Cagi, being well-versed in the cheese business, was a good fit for this partnership.
They have a proven track record for the same business model in the UK and US with Kraft Foods and Meadow Cheese, knowledge of the world market, raw material supply and prices, and knowledge of the South African market based on previous testing of the market via imports.
The company supplies its product to food manufacturers, the food service industry and pizza companies.
Ethekwini Cheese in numbers:
Jobs created: 94 30% of the company is owned by a black woman This project is reported by City Press and supported by the IDC
COAST IS CLEAR Pat Moodley, the regional manager of the Industrial Development Corporation in KwaZulu-Natal
SUCCESS The busy Sacks Packaging floor