JOHANNESBURG – Last week we joined Anheuser-Busch InBev (AB InBev)/(SAB Breweries) on a trip to the Free State to celebrate and visit one of the companies that has come through its Enterprise and Supplier Development programme and entered its supply chain.
Kevali Chemicals, manufacturer of waste-water treatment solutions, sanitation, cleansing and detergent products as well as adhesives, is located in Harrismith.
The company's success comes as a result of a combination of commercial decisions and economic conditions that conspired to put them on a significant growth path, enabling them to employ more than 80 people and change lives in the process.
The contributing factors to Kevali’s perfect storm include AB InBev/SAB’s commitment to local procurement (Kevali supplies them with the adhesive for all their labelling), their choice of location for their manufacturing plant in one of the country’s Special Economic Zones (SEZs), Maluti a Phofong and the government's commitment to the establishment and growth of these SEZs, with all the incentives and benefits they bring their tenants.
On the back of ABInBev/SAB’s “off-take” or guaranteed business, Kevali was also able to access funding through the Department of Trade and Industry's Black Industrialist Programme.
Without an off-take agreement in place, it would have been difficult to obtain this funding, proving that market support for local companies contributes significantly to our industrialisation efforts.
We wrote last year about our visit to Dube Tradeport, one of the SEZs located in KwaZulu-Natal, and how impressed we were with the range of activity from agricultural projects to 4IR investment, and with the vast number of companies that were attracted to the entire precinct.
The day before our trip to Harrismith we re-visited both Dube Tradeport itself and a number of the companies that are located there and had a most illuminating and fruitful visit.
Watch this space for news of exciting new members as a result of our engagements.
Operational investment in the country's seven SEZs is reported to be around R19 billion, with much larger amounts signed, but which have not yet entered the pipeline.
Job creation has risen in one year across the SEZs from 13 466 to 15 737 and when the additional investors are operational, this number will rise significantly again.
But back to Kevali and Maluti a Phofong. Two of the co-founders of the business, Bongumusa Kunene and Funeka Khumalo, who were both at our factory visit last week, had some inspirational stories to share with us about how SAB’s support, the incentives the SEZ affords them (including tax incentives, building allowances and employment incentives) and the Black Industrialists Programme funding have allowed them to change ordinary lives.
One such example is 25 year-old Itumeleng Motseki from Thaba Nchu. A graduate of the University of the Free State, where he majored in both chemistry and physics, graduating with a BSc, Itumeleng moved up to Gauteng where he felt job prospects in his field might be brighter than in his home province, where he couldn't secure employment.
Through the family that employed his aunt as a domestic worker, he was introduced to one of the Panarotti’s restaurants, where he found work as a trainee and then as a waiter. Not the career path he had hoped for.
Then he applied successfully for a position at Kevali when they began recruiting for their Harrismith plant. They took a chance on him, despite his lack of related work experience and two years ago he began working there as a plant process operator, a position he still holds.
Now, he is also the supervisor of interns in the laboratory. In his spare time, he is committed to volunteering in the research and development of the company's new products. And what a difference this company has made to this young man's life and that of his family.
Another inspirational human success story is that of Kevali’s head of security. From working as a guard at a Gauteng residential estate, this man befriended Kevali chief executive Bongumusa Kunene, who lives there.
The guard shared his ambitions to own his own company with Bongumusa and in pursuit of the fulfilment of his dream, registered his company, acquiring all the necessary qualifications and clearances. Taking a chance, he presented these to Bongumusa, who was hesitant to mention the opportunity that existed at their plant, due to its location in Harrismith, but he made the offer anyway.
Seizing the opportunity with both hands, the former employee now employs eight people of his own, changing all of those families’ lives in the process.
These are just two real life examples of how, through localisation we can make the re-industrialisation of South Africa a reality, creating many much-needed jobs, contributing to the growth of the economy and ending the poverty of many of our people.
With the assistance of government grants, funding and incentives, as well as the commitment by the private sector to increase their levels of local procurement, we can create many more Kevali Chemicals and give more people like Itumeleng and the security guard a decent future.
It all starts with the decision to support a local manufacturer, to create life-changing joy in the lives of ordinary South Africans.
Black Motion sang Joy Joy. Come and see them belt out their Proudly SA tunes at this weekend's DStv Delicious International Food & Music Festival.
Eustace Mashimbye is the chief executive of Proudly South African.