Is Ram, Choppies’ ‘Success’ Story Underrated?
DUMISANI NCUBE
Walmart, the world’s most successful retailer knocked doors on the South African market in 2011. With a total equity of just less than a trillion pula (BWP895 billion), 2.2 million employees around the world, its strategic merger with Massmart in South Africa was to define what was to be the new era for retail and FMCGs sector not just in the country of the strategic merger but across the continent.
To put this into context Massmart owns Makro, Game, Jumbo Cash and Carry, Builders Stores amongst dozens of other established brands. This was against the backdrop of Shoprite owning the crown of the African market in the FMCG space from Johannesburg to Gaborone and the rest of the mother continent. Spa, Pick n Pay and Woolworths are also domineering forces that have known nothing but leadership on the FMCG sectors.
Having some of the global leaders with expertise that is close to impossible to replicate closing deals with Africa’s market leaders for market domination and control meant a new era for the markets. What chance really would any player make and take in any part of the continent when the world’s best is playing a game of chess with great masterminds and strategists with a financial war chest which cannot be replicated?
Sam Walton (Founder of Walmart) at the end of his life is quoted saying, “If we work together, we will lower the cost of living for everyone… we will give the world an opportunity to see what it’s to save and have a better life.” Born during Great Depression his convictions were to serve the average working consumer by offering the lowest prices anytime, anywhere. His vision/strategy intent was premised on an un-ending quest to improve lives best on good competitive prices for all.
There is no business journal in the world that doesn’t celebrate the late Walton as the mastermind on matters of strategy. His model won the world over on pricing because of an enduring vision. Having his business’ presence on the continent through Massmart meant the world and markets watch in wonder and bewilderment as big boys do what they know best – dominate.
The Economist highlights that South African retailers such as Shoprite, Pick & Pay, Spar and Woolworths are highly sophisticated and offer a fine array of fresh food, at least in the big cities. Botswana saw an unlikely creation metamorphose in Lobatse in the form of Wayside. Two struggling stores meant for the local market of just under 20 000 at the time were trying to figure out a model which could rival local dominance of established brands and outcompete for the benefit of the ordinary Motswana.
An unknown accountant from Mazaars always seen analyzing figures, and as a regular at the store he was set to be the new visionary of what would be Botswana’s leading brand in its sector.
“Choppies was an exciting story because of its rapid growth and expansion as a leading FMCG player in Botswana. It’s phenomenal growth and eventual listing on the BSE was a spectacle.
Major players such as retail players like Spar and Pick n Pay upped their game in acknowledgement of Choppies’ surprise market domination,” notes an investment expert who is close to Choppies transactions and declined to be named.
“They took a dent with over concentration on the top line and rapid African expansion. Exiting Kenya, Mozambique, South Africa and other market and announcement of a measures growth strategy is what shareholders hope to see in addition to rolling out the full plan of a deputy CEO and succession,” he notes.
“WE are pleased with the re-admission on the local bourse. It is critical for a listed entity. We never compromised on investor confidence. We are exiting a few markets where growth came at the expense of Choppies Botswana. For the remaining markets Zambia is growing slowly, Namibia has a strong chance of growth and Zimbabwe is profitable despite challenges of market stability,” notes Ram Ottapathu.
Premised on finding solutions for the average shopper for basic grocery needs Choppies found a unique value frontier that established brands had left wide open. Any viable local farmer with produce knew that Choppies was good option to supply their hard-earned harvest. The intricate network of value for suppliers, countrymen alike grew thus creating numerous entrepreneurs along the way.
The Accountant turned entrepreneur had done what few have ever imagined. He created a multibillion-pula enterprise, expanded it from Lobatse to a regional thrust with a presence at home here in Botswana, in Zimbabwe, South Africa, Zambia, Tanzania and Kenya with prospects to grow beyond.
“Growth is fine but it should not be for the sake of growth. I support the exit strategy. I believe it give the current board room to regroup and use Botswana as a springboard for future ventures in the region,” the financial expert noted.
Are there better days ahead? Having done the unthinkable -conquering the perceived African giants in the Botswana backyard. Choppies has a chance to rekindle its flame. We have heard the story too many time what we need to hear now is how best can we return to the Choppies glory days? “When we stop funding loss making entities the value will go back to the shareholder,” concludes Ram.
*Dumisani Ncube is Digital Executive at Pr Practise
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Nigerians, Zimbabweans apply for Chema Chema Fund
Fronting activities, where locals are used as a front for foreign-owned businesses, have been a long-standing issue in Botswana. These activities not only undermine the government’s efforts to promote local businesses but also deprive Batswana of opportunities for economic empowerment, officials say. The Ministry of Trade and Industry has warned of heavy penalties for those involved in fronting activities especially in relation to the latest popular government initiative dubbed Chema Chema.
According to the Ministry, the Industrial Development Act of 2019 clearly outlines the consequences of engaging in fronting activities. The fines of up to P50,000 for first-time offenders and P20,000 plus a two-year jail term for repeat offenders send a strong message that the government is serious about cracking down on this illegal practice. These penalties are meant to deter individuals from participating in fronting activities and to protect the integrity of local industries.
“It is disheartening to hear reports of collaboration between foreigners and locals to exploit government initiatives such as the Chema Chema Fund. This fund, administered by CEDA and LEA, is meant to support informal traders and low-income earners in Botswana. However, when fronting activities come into play, the intended beneficiaries are sidelined, and the funds are misused for personal gain.” It has been discovered that foreign nationals predominantly of Zimbabwean and Nigerian origin use unsuspecting Batswana to attempt to access the Chema Chema Fund. It is understood that they approach these Batswana under the guise of drafting business plans for them or simply coming up with ‘bankable business ideas that qualify for Chema Chema.’
Observers say the Chema Chema Fund has the potential to uplift the lives of many Batswana who are struggling to make ends meet. They argue that it is crucial that these funds are used for their intended purpose and not siphoned off through illegal activities such as fronting. The Ministry says the warning it issued serves as a reminder to all stakeholders involved in the administration of these funds to ensure transparency and accountability in their disbursement.
One local commentator said it is important to highlight the impact of fronting activities on the local economy and the livelihoods of Batswana. He said by using locals as a front for foreign-owned businesses, opportunities for local entrepreneurs are stifled, and the economic empowerment of Batswana is hindered. The Ministry’s warning of heavy penalties is a call to action for all stakeholders to work together to eliminate fronting activities and promote a level playing field for local businesses.
Meanwhile, the Ministry of Trade and Industry’s warning of heavy penalties for fronting activities is a necessary step to protect the integrity of local industries and promote economic empowerment for Batswana. “It is imperative that all stakeholders comply with regulations and work towards a transparent and accountable business environment. By upholding the law and cracking down on illegal activities, we can ensure a fair and prosperous future for all Batswana.”
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Merck Foundation and African First Ladies mark World Health Day 2024
Merck Foundation, the philanthropic arm of Merck KGaA Germany marks “World Health Day” 2024 together with Africa’s First Ladies who are also Ambassadors of MerckFoundation “More Than a Mother” Campaign through their Scholarship and Capacity Building Program. Senator, Dr. Rasha Kelej, CEO of Merck Foundation emphasized, “At Merck Foundation, we mark World Health Day every single day of the year over the past 12 years, by building healthcare capacity and transforming patient care across Africa, Asia and beyond.
I am proud to share that Merck Foundation has provided over 1740 scholarships to aspiring young doctors from 52 countries, in 44 critical and underserved medical specialties such as Oncology, Diabetes, Preventative Cardiovascular Medicine, Endocrinology, Sexual and Reproductive Medicine, Acute Medicine, Respiratory Medicine, Embryology & Fertility specialty, Gastroenterology, Dermatology, Psychiatry, Emergency and Resuscitation Medicine, Critical Care, Pediatric Emergency Medicine, Neonatal Medicine, Advanced Surgical Practice, Pain Management, General Surgery, Clinical Microbiology and infectious diseases, Internal Medicine, Trauma & Orthopedics, Neurosurgery, Neurology, Cardiology, Stroke Medicine, Care of the Older Person, Family Medicine, Pediatrics and Child Health, Obesity & Weight Management, Women’s Health, Biotechnology in ART and many more”.
As per the available data, Africa has only 34.6% of the required doctors, nurses, and midwives. It is projected that by 2030, Africa would need additional 6.1 million doctors, nurses, and midwives*. “For Example, before the start of the Merck Foundation programs in 2012; there was not a single Oncologist, Fertility or Reproductive care specialists, Diabetologist, Respiratory or ICU specialist in many countries such as The Gambia, Liberia, Sierra Leone, Central African Republic, Guinea, Burundi, Niger, Chad, Ethiopia, Namibia among others. We are certainly creating historic legacy in Africa, and also beyond. Together with our partners like Africa’s First Ladies, Ministries of Health, Gender, Education and Communication, we are impacting the lives of people in the most disadvantaged communities in Africa and beyond.”, added Senator Dr. Kelej. Merck Foundation works closely with their Ambassadors, the African First Ladies and local partners such as; Ministries of Health, Education, Information & Communication, Gender, Academia, Research Institutions, Media and Art in building healthcare capacity and addressing health, social & economic challenges in developing countries and under-served communities. “I strongly believe that training healthcare providers and building professional healthcare capacity is the right strategy to improve access to equitable and quality at health care in Africa.
Therefore, I am happy to announce the Call for Applications for 2024 Scholarships for young doctors with special focus on female doctors for our online one-year diploma and two year master degree in 44 critical and underserved medical specialties, which includes both Online Diploma programs and On-Site Fellowship and clinical training programs. The applications are invited through the Office of our Ambassadors and long-term partners, The First Ladies of Africa and Ministry of Health of each country.” shared Dr . Kelej. “Our aim is to improve the overall health and wellbeing of people by building healthcare capacity across Africa, Asia and other developing countries. We are strongly committed to transforming patientcare landscape through our scholarships program”, concluded Senator Kelej.
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Interpol fugitive escapes from Botswana
John Isaak Ndovi, a Tanzanian national embroiled in controversy and pursued under a red notice by the International Criminal Police Organization (Interpol), has mysteriously vanished, bypassing a scheduled bail hearing at the Extension 2 Magistrate Court in Gaborone. Previously apprehended by Botswana law enforcement at the Tlokweng border post several months earlier, his escape has ignited serious concerns.
Accused of pilfering assets worth in excess of P1 million, an amount translating to roughly 30,000 Omani Riyals, Ndovi has become a figure of paramount interest, especially to the authorities in the Sultanate of Oman, nestled in the far reaches of Asia.
The unsettling news of his disappearance surfaced following his failure to present himself at the Extension 2 Magistrate Court the preceding week. Speculation abounds that Ndovi may have sought refuge in South Africa in a bid to elude capture, prompting a widespread mobilization of law enforcement agencies to ascertain his current location.
In an official communiqué, Detective Senior Assistant Police Commissioner Selebatso Mokgosi of Interpol Gaborone disclosed Ndovi’s apprehension last September at the Tlokweng border, a capture made possible through the vigilant issuance of the Interpol red notice.
At 36, Ndovi is implicated in a case of alleged home invasion in Oman. Despite the non-existence of an extradition treaty between Botswana and Oman, Nomsa Moatswi, the Director of the Directorate of Public Prosecution (DPP), emphasized that the lack of formal extradition agreements does not hinder her office’s ability to entertain extradition requests. She highlighted the adoption of international cooperation norms, advocating for collaboration through the lenses of international comity and reciprocity.
Moatswi disclosed the intensified effort by law enforcement to locate Ndovi following his no-show in court, and pointed to Botswana’s track record of extraditing two international fugitives from France and Zimbabwe in the previous year as evidence of the country’s relentless pursuit of legal integrity.
When probed about the potential implications of Ndovi’s case on Botswana’s forthcoming evaluation by the Financial Action Task Force (FATF), Moatswi reserved her speculations. She acknowledged the criticality of steering clear of blacklisting, suggesting that this singular case is unlikely to feature prominently in the FATF’s assessment criteria.