Black business hit hard
ALCOHOL BAN: BREWER SAYS SUPPLIERS WILL HAVE TO LAY OFF STAFF
Of 35 000 taverns in SA supporting black entrepreneurs, 54% are owned by women.
Black-owned businesses were some of the hardest hit by the reinstatement of the ban on alcohol sales. Vice-president of corporate affairs at SA Breweries (SAB) Zoleka Lisa said the suspension of alcohol sales has placed “an immense burden” on black-owned businesses across SAB.
Of the 35 000 taverns supporting black entrepreneurs, 54% of those are owned by women.
The tavern industry is worth between R40 and R60 billion, but 15% of township liquor outlets could not reopen, as they lacked the finances due to the initial alcohol ban on 26 March, which was brought back on 12 July.
In the logistics sector of SAB, three suppliers that employ hundreds of workers have lost millions of rands in revenue – with 40% of the contracted South African T1 transport grid 80% to 100% reliant on SAB.
The ban has led to suppliers needing to restructure their businesses and possibly lay off staff.
Lisa emphasised that the one month of alcohol trade in June was not sufficient for businesses to recover from the revenue lost in the previous nine weeks, where no sales were permitted.
SAB has 5 700 direct employees. It has 250 000 supplier and retail employees, 1 300 farmers – 800 of them emerging – and supports more than 10 000 retail businesses that sell alcohol for off-site consumption, as well as more than 22 500 labour-intensive businesses that sell alcohol for on-site consumption.
The alcohol industry lost R18 billion due to the last ban, costing government R3.4 billion in excise tax. Considering that SAB pays approximately R1.2 billion in excise tax contributions per month, with a total of R14.4 billion in excise tax contribution in 2019 alone, the sector is one of the largest tax contributors in the country, Lisa said.
In addition, CEO of Consol Mike Arnold and iSanti Glass CEO Shakes Matiwaza recently provided their figures to the department of trade, industry and competition.
Between the two glass packagers, more than 26 000 direct and indirect employment is created, the income from which supports an estimated 50 000 people.
The alcohol industry accounts for over 85% of Consol and iSanti Glass’ production and sales.
They warned that “the closure of the glass industry and permanent failure of suppliers in the value chain would deindustrialise the economy by R20 billion, and the country would have to become a net importer of glass packaging and other related products”.
This deindustrialisation would take the sector “a decade or more to recover”, they warned.
The Food Allied Workers Union (Fawu), which represents the majority of workers in the liquor industry, said they were “outraged” by government’s decision to reinstate the alcohol ban.
Fawu said the decision “degrade[s] them as human beings with families who should have been given an opportunity to prepare before complying with the regulations”.
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