Soweto market is 'grand opening' for black capitalism
It was no way to launch a new supermarket. But when it finally took hold, the result was a triumph for black capitalism in the huge African township of Soweto.
The start was unpropitious: Money for the building was to be raised by selling shares to the public. Sales were brisk, but nowhere near enough to construct a new market.
Management decided to borrow. But lenders backed off when they discovered the supermarket did not own the land on which it wanted to build. Funds were finally raised on a complicated ''leaseback'' arrangement.
Building was completed six months late. All the while the company paid salaries with no income. A month before ''grand opening,'' the store's shelves, fully stocked, collapsed.
But after those early problems the supermarket began to buzz with activity. It provides blacks a center of retail activity in their own midst.
This matters because Blackchain represents one of the first major efforts by blacks in South Africa to do business in their own urban communities, away from the ''white'' areas they have traditionally supported as consumers.
Blackchain is big - 21 checkout counters - and completely black-owned. It also owns the shopping complex in which the supermarket trades. It is in Soweto, South Africa's largest black township, which has an estimated 1.2 million people. Blackchain calls itself the first black ''nationally owned (through shares)'' supermarket in the country.
''Blackchain is a very important development in black business involvement. Traditionally, blacks have been strictly 'mom and pop' operators,'' says Moses Maubane, general manager of the African Bank.
The way Mr. Maubane sees it, Blackchain not only provides the possible beginning of a substantial Soweto business community, but also a way for blacks to gain more skills and move into higher levels of retailing and eventually the manufacture and production of goods.
Instead of being simply a labor dormitory for the factories, offices, and shops of Johannesburg, Soweto is beginning to have a business life of its own. Some blacks no longer commute into the white areas of Johannesburg and exchange their paychecks for goods; they now do their shopping in their own community.
The spinoff of growing local business may be that more jobs and money will stay in Soweto, providing a greater sense of permanence and economic self-reliance to the community, say those urging more local commerce.
On a second-floor perch overlooking the store floor, managing director H. S. Majola concedes Blackchain has had problems. ''But there is no turning back now, '' he says, surveying the lengthening lines of weekday shoppers stocking up for the Christmas holidays.
''We will be profitable next year,'' Mr. Majola predicts. Others associated with the supermarket agree with his forecast. Profitability would be a considerable achievement, given that Blackchain is only 20 months old.
Blacks are already major consumers in South Africa's economy. And black buying power will increase more than fourfold over the next 20 years, according to an estimate from the national African Federated Chamber of Commerce.
It is not difficult to understand why. Places like Soweto are still in the process of switching to electricity. This alone will spur demand for televisions and appliances. With black incomes rising and the steady migration to the cities , blacks will become more important clients for all businesses.
Mr. Majola figures that Soweto's consumers put 80 percent of their spendable income outside the community.
As its name implies, Blackchain intends to open supermarkets in other locations. An application has already been made for another site in Soweto. But Mr. Majola points out that black businesses in South Africa are at the mercy of bureaucratic decisions over which they have no control.
The application was filed in early 1980. But in South Africa, property in black townships is administered by the government, and Blackchain has yet to be allocated any land. If it does get a site, it will not own the land - as was the case with the first Blackchain - but can be granted the right to use land on a 99-year lease.
''We must beg for a site, not bargain for one,'' says Mr. Majola.
Blackchain also is keen to open its doors in Johannesburg proper. The city is still reserved exclusively for white business trade, even though groups like the Central Business District (CBD) Association repeatedly call for opening up Johannesburg to all races.
CBD chairman S. Nigel Mandy says, ''We feel there should be no discrimination of any kind in downtown'' because more than 70 percent of the greater Johannesburg population is black, and because more than 70 percent of the labor force in the same area is black.
Rather than opening up ''white'' Johannesburg to blacks, the government has done the opposite - opened up Soweto to white capital. White employers and developers under recent legislation can now obtain leasehold rights in black urban areas.
Those supporting the change reason that white capital is needed to speed development of black areas. But black business interests oppose the move as one that will undercut efforts by blacks to develop their own business sectors.