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“Challenges have not changed much in Africa” says Africa’s biggest shopkeeper, South Africa’s Whitey Basson

September 15, 2013

Whitey Basson asks for either green tea or rooibos in his office in Brackenfell, just beyond Bellville and Parow in the Cape. He’s trying to make healthier food choices with all the travelling he does. At the age of 67, Basson still travels at an extraordinary rate at the helm of Africa’s largest retailer, Shoprite Holdings.

This month it’s Johannesburg a couple of times, Ghana and London.

Comfortably now past retirement age, there have been murmurs for years that sooner or later, Basson must surely hang up his hat.

And once the man who dragged Shoprite to the top of the retail flagpole is out the way, analysts believed, it would be open season in the retail space, with the way open for Pick n Pay to mount a renewed challenge.

But Basson says he’s not going anywhere any time soon, despite more than three decades in the job.

When asked whether he’d still be at Shoprite in five years – he’ll be in his 70s then – Basson is unequivocal.

“Yes, but not in the same job. I’ll stay on as the CEO but I’ll pass more things over. I’ve already passed off two or three of my big areas like property.

”I used to sign off every property in Shoprite. I said to my team I can achieve more by going to a new country and helping there.

”I still have a few departments such as marketing and foreign countries reporting to me, and then Carel Goosen still does finances. But if I left tomorrow, things will run the same.”

Basson says there are several in line for the job, but he won’t comment on names – 2018 is a long way away – but the group has 1800 graduates working throughout its different levels. “We have firm succession plans but we’re not at the stage where we nominate people.”

It’s this relentless drive that, a few weeks ago, made Shoprite – a home-grown retailer – the second-largest retailer in the world after America’s Walmart, surpassing even the French-owned Carrefour.

Shoprite is now worth R96.9-billion, making it the 18th-biggest company on the JSE.

The stock is worth R167 a share. Which means that if you’d put R100 000 into Shoprite shares back in April 1994 when South Africa entered a democratic era and the share was at R1, that stock would now be worth R16.7-million.

This is a consequence of Basson’s theory that his team and inner circle are like that of boxers in a ring, competing for excellence. No excuses or mediocrity are tolerated.

“I am told when I miss shots and so are they. It is tough but the reality is that we need to be sharp to survive. Blood flows and we all take it on the chin but in the end it is all worth it.

”And I will know when I go down too many times that it is time to go.”

You won’t spot any blood on the floor in his office, though. The office feels more homely than many other executive suites. An entire wall is plastered with photographs gathered over decades, many of them of family. He has four children and a few grandchildren. There are photos of Nelson Mandela with Basson and his family.

Basson sits on the sofa and while he talks, the photos shift on the digital photo frame, mainly of his grandchildren, dressed in pink. The image of a proud grandfather contrasts starkly with that of a steely executive.

But the question is, where will Shoprite go during the next decade? What will be the driver of its next R100-billion?

The answer lies in the rest of the continent.

Basson was the first retailer to see big possibilities in Africa. Though initially it was more a case of testing himself against bigger competitors and international players outside of South Africa, it was also to see if they really were a good team. “Africa was really the only place where we could take the money out to play.”

Challenges have not changed much in Africa, but they have become more moderate, he says. “The biggest challenge is still Africa trying to do business with Africa … [if] there’s a Brics conference and then people say we have to sort out visas – for the past 10 years I’ve been trying to sort out visas with the help of the president and it’s still not sorted out yet. Silly things like that. I can’t even get a work permit to get someone to train people in another country,” he says.

“Then you have these fantastic politicians like the one I just saw in Turkey. I asked how the hell did you manage to change things in 10 years because the last time I was there, I was travelling behind goats. He says for instance, Turkish airlines now flies to the most destinations, it’s the cheapest airline. Because his motto is: ‘we take the people to the rest of the world so they can do business, and we’ll bring the tourists here’. That’s 31.5million tourists a year in a 75million country.”

Another challenge is the inability to get products inexpensively into Africa. Basson says a basket of goods in Luanda costs 3.01 times more than in South Africa.

“A lettuce costs R75 in Luanda, it costs R140 for a pocket of potatoes. Why should the people of the breadbasket of Africa – Angola – pay three times more?

“Those are the practical things that people never expose themselves to. So you have these conferences where people spend their governments’ money, they have 150 bodyguards and I say come with me to the shop, let me show you what it’s like. And that’s Africa.

“It’s getting better but we’re never going to catch up with the world.”

Luckily for Shoprite, Basson does not see much competition from global retailers in Africa yet. He says Walmart has other challenges such as corporate governance accusations affecting the group.

Carrefour recently said it was moving into North Africa, but Basson says it is battling. Its new CEO has a lot on his plate.

Shoprite has fewer labour disputes than many peers. Some would say it’s about the iron management and steely executive team. Basson says money is not the only driver behind working for a company, and that the group has a policy of employing employees’ children , so long as they meet the criteria.

He says Shoprite does not have senior managers hired from elsewhere; its own people are built up over the years.

And with that he’s off to other challenges and meetings before he flies off to Johannesburg the next day.

Within the week a crisis emerges in Mozambique. Five Shoprite stores are closed there. The group said this action stemmed from the dismissal of an employee found selling expired margarine through the back door. The Mozambican government’s National Inspectorate of Economic Activities closed down the stores in Maputo, Boane and Chimoio for selling old food.

Big risk, big reward.

Story by Adele Shevel, courtesy of Times Media

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From → Africa, Retail

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