Doing business in the townships

25 Sep, 2020 - 00:09 0 Views
Doing business in the townships Harare City’s water woes have had a negative impact of lifestyles within the townships

eBusiness Weekly

Joseline Sithole

I used to think that ghetto/township (herein referred collectively known as township) folks were a bit brash, about their vibes, until I started conducting research in South African townships. Indeed, there is a certain kind of “vibe” and “energy” that is found in the townships that cannot be seen in our quiet leafy suburbs. The number of songs too, that have been sung about the ghetto, conjure feelings of nostalgia and longing into a lifestyle that most of us grew up in and sometimes long to relive.

Remember that Oliver Mtukudzi song “Ghetto Boy”. The late great Oliver Mtukudzi gushed that, “You can take me out of the ghetto. And can never take me there again, but you never take the ghetto out of me.” Then Tocky Vibes, also chipped win with “Takangodaro takazvarwa tangangodaro hatiregedze kuita hunhu hweghetto” translated to, “We were born ghetto and we will live like the ghetto people we are”

Indeed, once you have a feel of the ghetto lifestyle you are “hooked”. Conducting research in townships such as Soweto, Alexandra Park, Diepsloot and Gugulethu, exposed me to the different character and feel of the business environment there. In Zimbabwe, townships, such as Mbare, Highfield, Sakubva and Mkoba, to name just a few also exhibit a life of their own.

Places such as Mereki in Warren Park, transcend all social barriers as patrons come from all over to sample braai meat. The legendary Amai George, “braai mistress extraordinaire” is rumoured to have built a sprawling mansion in Warren Park through proceeds from “braaing meat” here. (I know that husbands gushing about Mai George’s braaing skills brought many a conflict into homes)

I have mentioned earlier that I studied a lot of township consumer back in South Africa. Among the Fortune 500 companies that I conducted research for, it was always a must that the sample study consisted of township respondents. Why was this important to these billion dollar companies? The Book, “The Fortune at the Bottom of the Pyramid” by CK Prahalad and Stuart L Hart, offer a glimpse on how entrepreneurs can start devising business models that are targeted at providing goods and services to the poorest people in the world. According to Bill Gates, this book “offers an intriguing blueprint on how to fight poverty with profitability.” A report by Human Sciences Research Council (HSRC) notes that, “There is a great deal of apparent vibrancy and diversity to township economies.

However, it should be stressed right from the start that townships, constitute a cross section of people from different economic tiers. That’s why they can offer huge opportunities for companies with different product lines and different target markets. Lately there has been renewed interest in township economies.

However, it is extremely difficult to quantify any sort of economic statistics, within townships for the simple reason that they are highly informalised. In South Africa the township economies have been estimated to be worth about R100 billion. Though this figure has been largely disputed, some critics have argued that this figure might actually reflect township “economic prowess”. According to HSRC report cited above, recent studies have portrayed townships as “potent economic spaces replete with entrepreneurial activities”

In Zimbabwe studies are even sketchier and are confined to a couple of case studies in specific study areas. However, it is widely acknowledged that Mbare Musika the oldest and largest market place in Harare, is a regional fresh produce powerhouse with very strong supply chains. A look around some of the townships reveal different economic activities. Tuck-shops, vending, bars and food are major economic businesses within our townships. So how can we ensure as entrepreneurs we take advantage of these opportunities that exist in these markets?

Innovation matters — Councillor July and Aaron Matapi Glenwood

A drive or a walk through our townships will reveal certain business activities that are quite innovative and ground-breaking, For example, if one visits Hopley farm, you are bound to encounter “sawdust entrepreneurs.” This sawdust is used as an alternative for wood fuel in an equally interesting stove contraption. Apparently a combination of this stove and this saw dust is enough to cook a whole meal.

I discovered Aron Matapi, in the sprawling dormitory town of Epworth. Aaron visits hotels, where he collects empty expensive whisky, brandy bottles. He then cuts these very strong bottles to make ordinary glass bottles you can use for drinking water. I use mine to store some loose things such as pens and seashells. However, his whisky glasses have a large following with people mainly buying them for their longevity.

Opportunities exist

Harare City’s water woes are legendary and this has had a negative impact of lifestyles within the townships. Queuing at a borehole takes an average of about 5 hours. But lately I have noticed that there is an influx of bucket sellers in all areas to meet the high demand of water storage. In South Africa, water shortages opened up opportunities for 32-year-old Rorisang Mpete, co-founder of Loo Afrique. The young entrepreneur has developed a range of innovative portable hand washing stations for non-reticulated settlements. The product consists of multiple wash points which is accompanied by a 10 000 litre grey water storage tank. The fresh water tank can be filled by a municipal water line while the grey water is desludged by a desludging trick service.

Brands Matter

Our township folk are also very savvy when it comes to buying or wearing brands. In South Africa the annual Kasi Star Brands, showcase the most liked brands. According to Ask Africa, a leading research company in South Africa, the overall 2017/2018 favourite township brand is Coca-Cola with KFC in second place and Koo Beans in fourth place. In Zimbabwe, though there is not much research that has been conducted on this area, but a quick perusal border goods. Big and new brands should therefore take note of this brand consciousness.

Marketing haven

It is quite easy for marketers to enter township markets with the same conventional way of thinking and doing business. But marketing in townships require completely different ways of thinking in terms of product packaging, pricing and penetration. According to Ask Africa, “Living and doing business in African market places require an ethos and connection to the informal, invisible and intangible”. The firm adds that, marketers targeting this market should have an in-depth knowledge of a continuously changing environment. It is therefore highly important to thoroughly understand the needs of the township market place and their aspirations. To achieve this though qualitative and quantitative market studies need to be conducted at a regular basis.

BWD blog post notes that “Big brands have a tendency to create marketing campaigns abroad, and simply adjust them to make sense within these township spaces.” This inevitably creates disconnections between the target markets and the brands. The Blog Post suggests several ways of marketing which include: Social interaction as a tool for marketing, targeting commuters and the tavern market to name just a few. Local talent should also be incorporated into the marketing strategies and narratives wherever possible.

Develop appropriate products

Huge populations in townships enable brands to push more products at affordable prices provided that your products are in high demand. Over and above the basic grocery necessities that are a must on all the township shopping list, there is a growing need for service related products such as healthcare and microfinance.

According to Graham Wright, MicroSave Director “bath tub product development” developed on the basis of senior management’s team experience and gut instinct should not be encouraged. Wright argues that services such as microfinance should be convenient, accessible, affordable and appropriate.

Leverage on organised groupings

The Ubuntu philosophy permeates among many African communities. Generally, Africans are very communal in the way that they do business. Stokvels are a major player in township economics. In South Africa major supermarket chains now offer discounts to these groupings provided they reach a certain threshold in buying groceries. In Glenwood, a township that is adjacent to Domboramwari, Councillor July, presides over a total of about 30 Women Savings Groupings. According to July, these women have built houses, send children to school etc. using funds from their Savings Clubs. They are thus contributing immensely to the economic activities of the township. However, they lack coordination and partners to upscale their business activities.

Township Cuisine

“Highfield Stew” is a popular dish that consists of a mixture of green vegetables such as “covo, tsunga or rape” mixed with large chunks of meat boiled over slow heat. (We will advocate for this delicacy to be included in the Oxford Dictionary.) To this end, huge opportunities exist in townships to show case African cuisine to tourists. Marcus Samuelsson is a famous Ethiopian Chef who has managed to incorporate traditional Ethiopian cuisine into award winning dishes. His highly successful restaurant Red Rooster in New York attracts patrons from all over the world.

In conclusion there are big entrepreneurial opportunities to be found in townships. I sign off with a rather peculiar quote from the late Rapper Tupac Shakur. I wonder if heaven has got a ghetto. Let’s think business let’s think ghetto.

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