Gutsche looks back on stellar career, giving tips on succeeding in business
Bottling company boss later changed his focus to guiding investments
Coca-Cola’s ingredients might be a closely guarded secret but when it comes to the success blueprint of Gutsche Family Investments (GFI), its chairperson, 84-year-old Philipp Gutsche, does not hold his cards close to his chest.
The bottler of the iconic brand and other well-known beverages that has made the Gutsche dynasty a household name in Gqeberha, SA, Africa and across the globe, told a PROBUS audience at the River & Ski Boat Club recently that the empire had been built on a determination to succeed and a hard work ethic.
GFI is a family company originating from the old SA Bottling Company, with a long established history in Gqeberha, which has passed the acid test to establish an indelible footprint in SA, Africa and abroad.
Gutsche said his family had made a business decision some years ago to change their focus from being operators to investors, hence the transition into GFI. There is only one exception though when it comes to that arrangement, Woodlands Dairy, started by his father in Humansdorp many years ago in his retirement years. It still runs as an entity under the GFI stable.
“My brother joined him in the business and the dairy has become the biggest supplier of UHT milk in South Africa.”
Gutsche who has five children, is known for indulging in one of his favourite pastimes, sailing, with his yacht, Warrior, having competed in Cape to Rio races since the mid-1990s.
Gutsche, said the first Gutsche arrived on the beach in Algoa Bay in 1867 with his wife Mary Lange. Carl Hugo Gutsche was a pastor who answered a call for a German Missionary pastor in the border region of the Eastern Cape.
“My father [Carl Hugo’s son] started off from nothing and was able to develop as a Coca-Cola bottler and today we have ended up as the seventh-biggest Coke bottler in the world and the biggest in Africa,” said Gutsche.
Gutsche comes across as an unassuming businessperson with a friendly, cordial demeanour, but there’s no doubting his sharp business acumen, wise counsel and hard work ethic that has seen the family’s bottling company cement itself as a global player in the soft drink industry.
His father, Phillip Snr, joined the company after the wool broking business where he worked as a manager in then-Port Elizabeth after being transferred from East London, closed its doors.
“My father got this [wool broker] job just after he matriculated thanks to my grandfather who paid the employer one pound a month to put him into a job,” he said with a grin.
“Prior to that, he tried very hard to get a job but just couldn’t.”
Following that experience, his father joined SA Bottling company as a route driver salesperson in October 1940 “and at that stage he had one son and a pregnant wife”.
Phillip Snr was transferred to Brakpan, “which was then a thriving town” in April 1941 as manager of a new acquisition.
“Dad worked hard for an American family in Brakpan and they had three franchises at that stage factories in Brakpan serving the East Rand and the head office in Port Elizabeth.”
The transition in which his father became sole owner of the company in 1960, occurred after 16 years of service, mostly in Brakpan and being thrust into the role of managing director and acquiring a portion of the company’s shares.
Gutsche joined the business as manager in PE after matriculating in East London, in the early 1960s. “I had earlier worked as a driver salesperson during my holidays as a university student at UCT.
“After 18 months of work, I received a call from the head of the company who asked me to report at 8am the next morning. They then offered me a job in Port Elizabeth as manager, which turned out to be a promotion.
“They put me through an intensive training course at their Pretoria factory, where I worked under an Afrikaans-speaking manager who showed me how to develop into a manager.
“I took lots of notes, made copies of all the documentation and then I went to Port Elizabeth and made every mistake a man can make in business,” Gutsche said to laughter from the audience.
Gutsche points out among all the important business rules there are to know about running a business, one important aspect stands out. “Control the cash flow, it doesn’t matter what size your business is. Businesses come unstuck when the CEO doesn’t watch the cash flow. If you don’t, the business will come unstuck.”
Gutsche said soon after arriving in Port Elizabeth to manage the business in the ‘60s, his father bought another small bottling franchise on the south coast on Natal, “for a very small price”.
“A year later he built a bigger factory for that area. Dad had a lot of confidence in the south coast of Natal. In 1964, he bought a franchise that linked PE-Bloemfontein and Middelburg he vascillated between retirement and working hard
and I actually realised he had a problem because he often went to the south coast to relax but in fact he never did.”
Phil Gutsche was appointed managing director by his father in 1974 and “I must say I initially battled around issues of being involved with a family business.
“I then realised another important facet of business the importance of scale. You have to have scale if you want to grow a business. I bought the Pietersburg operations (now Polokwane) and it became the biggest factory producing Coke in Africa.”
With a yearning to become an even bigger bottler, the company acquired smaller factories in the country. My focus on scaling of the business did elicit anger from certain sections of the family, especially after my father passed away, so I can tell you it gets very rough. However it does take a lot of patience.”
Gutsche said a great opportunity arrived for the company when it was able to acquire the franchise for Mozambique. “We built a factory there in record time, with South Africans and really grew the company from there.”
In 1994, the company was offered the anchor “bottler ship” for the East Africa region and grabbed the opportunity with both hands.
“We went into this project with passion and enthusiasm and I moved a lot of competent South Africans to East Africa to lead and grow the business.
“With Coca-Cola you have got to give service and you got to be much more capable than anybody else. It’s all a straight honest type of business. The last thing you want to do is take short-cuts,” he warned.
Gutsche, who says he will probably hand over chairmanship reins next year, is still passionate about sailing and various other roles as philanthropist.