Big firms killing small township businesses

BHEKISISA Ngcobo’s situation reflects the plight of small businesses forced to close when supermarkets opened in townships and rural areas.

This week, the Competition Commission brought its inquiry into grocery retail stores to Kwazulu-natal.

It concluded its work on Friday and the report will be released later this year.

While some said this was a step in the right direction, Ngcobo, a once respected and influential businessman in umlazi and surrounding townships, believes the commission was a futile exercise “that is not going to yield results”.

Ngcobo, a father of six, said he was one of many victims of big retailers.

“The commission must visit townships and places like Chatsworth to see how big businesses have killed ours. I used to own a chain of stores in umlazi. Now all that is gone. It was not sustainable as I was no longer making a profit.”

Ngcobo, who started his business in the early 1980s, was forced to shut down in 2009 after several malls were built in the township.

Ngcobo also blamed his business collapse on foreigners opening spaza shops.

Once a wealthy man, now he battles to make ends meets and relies on an old age grant to support his family.

umlazi has three malls with big retailers: Mega City in V section, Kwamnyandu Mall in D section and Philani Mall. There is also a string of large supermarkets.

Among the big grocery stores at the malls are Spar, Pick n Pay and Shoprite.

Noddy Govender, who still owns a supermarket in Chatsworth, said it was hard to keep his doors open. He admitted he has struggled since Shoprite opened a store in the nearby shopping centre.

To survive, Govender said his store stayed open late so that people could shop there when Shoprite was closed.

“Staying up late led to my health deteriorating,” said the 60 year old.

Mandla Zuke, from Kwamashu, said: “My business took a big cash flow knock with the introduction of Bridge City Shopping Centre.”

Zuke said he has had to dust off his CV and was looking for a job, “something I never thought I would have to do”.

“These malls in townships are built under the guise of creating opportunities for small business owners. That never happens. Instead, they lead to the demise of our businesses.”

The issue of foreign nationals owning outlets in townships and rural areas also came under fire, with some saying they were “killing” local businesses because they did not conform to regulations.

One of the big retailers, Spar was the only one that appeared before the commission on Friday.

Spar told the commission it took pride in the progress the company had made in uplifting black entrepreneurs.

Nizzie Nkwelo of the Eastern Cape owned three Spar supermarkets, while Dan Maluleke of Gauteng independently owned 12. They told the commission they had to join forces with big retailers like Spar because their businesses were on the brink of collapsing when big supermarkets opened in the townships and rural areas where they operated.

Of the 823 Spar stores in the country, 100 are black-owned and independently run.

Lulama Mtanga, a competition law expert who was one of the chairpersons, said it was worrying that some big retailers did not want to appear before the commission willingly.