Lucrative export window for textile industry
Pauline Dikuelo | Friday February 24, 2017 17:09
The workshop followed the last November’s Ministry of Investment, Trade and Industry engagement with them and other retailers to start giving preference to local suppliers.
This was a condition set by government as a way of ‘arm twisting’ foreign retailers operating in reserved businesses to empower Batswana. The Ministry says it have reached a mutual satisfactory agreement with the South African retailer consenting to capacitate local suppliers as well as giving a part of their in-store floor space to local suppliers in the next two years.
As part of the agreement, Edcon will avail 10% of its floor space to local suppliers in the two years leading to December 2018. The exemption would allow them to trade in the clothing retail space reserved for citizens, with Edcon agreeing to facilitate and run supplier development workshops in Botswana on agreed dates.
These are intended to educate and build capacity for local producers on product costing, product inspection, quality requirements and retailer fitting rooms. The aim is to bring local producers to the level of quality that will enable them to supply the readily available market for retailers.
Through last week’s workshop, Edcon shared expectations on the quality of products they require in order to penetrate the group’s market. According to the general manager of Edcon Group quality, Noel Paulson the local industry has got the potential to penetrate other markets as they produce quality products that can compete with the already existing ones. Paulson says despite this, she has realised that most of the local producers limit themselves to the local market despite the potential they have.
“I was impressed with the feedback that we got from the participants. I see there is interest in the local market as they are ready to penetrate the retail market. However, these suppliers prefer to produce for the local market, despite the potential they have,” she says.
In addition, Paulson encouraged the local producers not to be intimidated by the already existing manufacturers urging them to rather do collaborations where possible to produce products that will go beyond the border noting that most of their suppliers in South Africa are SMMEs.
She expressed hope in local producers advising them that they need to start producing for other markets in order for them to grow. She notes that when they select a supplier that is one of the things they consider.
Currently Edcon is working with two local suppliers, Nortex Botswana and B&M Garments.
Botswana Textile and Clothing Association president, Banusi Mbaakanyi shares the same sentiments as Paulson noting that the textile and clothing industry needs to organise itself well both at the internal environment of the firm and its outside supply linkages as well as to be able to respond well to the market availability of the Edcon Group.
“The industry should be capacitated through local procurement upskilling on all the sectional areas with the form with appropriate skills sets, accessibility to funding, raw material acquisition and accessories as well as the latest machinery and technology needed by the sector,” she says.
Mbaakanyi says the industry came up with a few tangible resolutions that would require engagement with the Ministry which will require the association working together with government facilitators to develop a list on capacity development issues and determine those that could be done by the association. She says they expect Edcon to give them the same preference they are giving South African manufacturers.
Acting permanent secretary in the Ministry of Investment, Trade and Industry, Nelly Segonelo says through training, participants would attain lifelong skills that will make a positive impact on their businesses going forward. “This forum is important as it provides a platform for stakeholders to exchange information, share experiences and learn from each other. The purpose of this meeting therefore is for Edcon, which is a multinational retailer, to share with you their expectations with regards to the kind of products they sell.” In addition, she says as a responsible Ministry, they are mandated to create a conducive environment for the development of sustainable industries and trade with a view to diversifying and growing the economy in order to create wealth and employment.
“As a Ministry we have been engaging with non-citizen retail business owners who trade in the reserved business space. The Ministry’s engagement was to endure that there is citizen empowerment especially that the activities are reserved,” she says.
She says their expectation in other retailers is to demonstrate how they will empower Batswana such as through sourcing of local products as a way of driving the Citizen Economic Empowerment. Segonelo notes that the engagement has gone well so far as most of the retailers have been submitting proposals detailing their citizen empowerment plans. Last year, the local chamber of commerce, Business Botswana (BB) also called on locally-based South African retailers to support and empower local entrepreneurs, especially the Small and Medium-sized Enterprises (SMEs). The call was made at a workshop held by BB and retailers from the neighbouring country operating in Botswana on trade regulatory issues affecting local entrepreneurs.
BB chief executive officer, Racious Moatshe says they decided to engage the South African Business Forum after it emerged through their consultations with local retailers that most of their South African counterparts do not empower local entrepreneurs.
“Many business operations locally are from South Africa, and we have gathered that most of them do not give preferential treatment to local products hence we decided to engage them. Retailers have raised a lot of issues that we will be discussing in this consultation,” he says. Moatshe further states that the aim of the consultation is to come up with solutions that would ensure that both parties from South Africa and local retailers play a significant role towards the development of the private sector.