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How Soccer Laduma Scores In More Than One Way

From absolutely no experience in publishing, Peter du Toit has built up the biggest single- copy-sale weekly publication in South Africa. Soccer Laduma has a turnover of R90 million, 3,4 million readers and some of the most loyal customers in the country. By following his heart, embracing his passions and getting everyone around him to do the same, Du Toit has discovered that you can have it all: Passion and great success.

Nadine Todd

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Vital stats

  • Player: Peter du Toit
  • Company: Soccer Laduma
  • Established: 1997
  • Turnover: R90 million
  • Visit: soccerladuma.co.za 

It was 1993. Peter du Toit had long hair and an earring, and he’d just made the decision that he never wanted to wear a suit again. He wanted to wear flip-flops, surf and go to work in shorts.

So far life hadn’t quite turned out the way he’d planned. He’d left South Africa in the mid-70s to play professional football overseas but his dreams were shattered when he broke his leg, and to make ends meet he started a micro-computer business. It was the 1980s, and although he knew nothing about this fledgling industry, he learnt enough to build a business that he was able to sell for a decent profit a few years later.

But now what? He was nearing his late 20s and wasn’t actually sure what he wanted do with his life. All he knew was: No suits.

And so he did what any young man in his 20s with no responsibilities would love to do. He travelled. For four years he followed football around the world, indulging his greatest passion, even if he could no longer play himself.

And along the way he stumbled across an amazing business idea. “There were only a handful of dedicated football newspapers around the world,” he says.

“And I was buying them all. I couldn’t even read most of them, but if I was in Brazil, I was buying their Portuguese football newspaper and muddling my way through it. That’s what passion for a subject does, and people can get really passionate about football.”

So… a business built around football. Could he make it work? “I knew nothing about publishing, but then, I’d known nothing about micro-computers or the stock market either, and I’d managed to build a business there.

“The first rule of business is: Don’t do something you know nothing about. But I’ve always found that rules are made to be broken. Plus, this was something I genuinely loved. The universe would teach me what I needed to know. I just needed to get started.”

For the first 18 months Du Toit lost money. A lot of money. “Because I didn’t know this industry, I’d hired experts. That just meant that we were doing what already existed. There was nothing special about us, and the business wasn’t working.”

So Du Toit made a risky decision. He replaced his industry experts with himself and readers as writers. He chose passion over skill and industry experience. And something magical happened as a result.

Related: 8 Life Lessons From Peter du Toit of Soccer Laduma You Should Apply In Business

“For the first 18 months we sold 27 000 copies a week. Within two weeks of my changes, we were up to 40 000 copies a week. It was a quantum moment for me. If you’re doing what you love, and you’re surrounded by people who are doing what they love, success is inevitable.” 

It’s all about the passion

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“From the moment we hired readers who were passionate and could write, we started to skyrocket. Hiring like-minded people was a game-changer for me. I realised that experience is irrelevant. You can learn skills, particularly if it’s around a subject you’re passionate about. You don’t even need to ask them. They’re committed to your vision. If you offer trust upfront, they’ll even redirect themselves after mistakes. If you love what you do, this comes naturally. Even mistakes don’t come from a bad place. You can find a solution together, and nine times out of ten it won’t happen again.”

Soccer Laduma’s current success lies in the fact that Du Toit has maintained this culture, even though the business has grown to 45 full-time employees.

“Those early hires were incredibly important, because they brought like-minded people into the business. As we grew and needed to hire more people, they knew exactly what we were looking for. We all wanted to maintain the same team dynamic. I’m not even needed anymore in that respect. The team understands its own make-up.”

Du Toit’s first rule is that he’s not the boss. The reader and online user is the boss. “No one works for me. They work for the reader. It’s an important mindset, because it means that everything we do is with the reader in mind. What do they need from us? What do they care about? Are we delivering on those needs?”

Even though the reader is the boss, Du Toit has implemented a system to ensure everyone works towards keeping that boss happy. It’s called the six golden rules: Planning, planning, planning, preparation, preparation, preparation.

“If a story didn’t do well we know that one of the six golden rules was missing. I’m able to ask the writer if they followed the rules, and they’ll know that somewhere they cut a corner, and the result is clear for everyone to see.

“I don’t like conflict, so I’ve found it’s important to all be on the same page. If the guidelines are clear you can point to them when something doesn’t have the desired effect. No arguments needed.”

The system’s working. Soccer Laduma has a 100 to one compliments/complaints ratio.

Related: 3 Become 1: The Story Of How IS SME Business, MWEB Business and IS Ignite Merged

“I believe this is because we don’t have an opinion or ego. We haven’t set ourselves up as industry experts, but instead bring readers and fans to the players and coaches. We connect those dots, and so everything is all about their opinions. We’re not telling you what to think. We’re giving you access. No one in our organisation is an expert. Experts focus on what they know. We believe that what we don’t know is far more important. That’s what we’re always pursuing.”

This attitude means that Du Toit will put anything into the paper that his readers want. “We receive reader letters and are then able to call players and tell them how much our readers want an interview with them. They’re happy, the readers are happy, and we’re living up to our values of connecting those dots.”

Soccer Laduma takes this a step further though. Readers can send in questions for specific players as well, and they’re published with the reader’s name. “We sell 310 000 copies per week, and have an even larger online user base, and we’re still managing to feel like a small community. Each of our readers feels a sense of ownership over the Soccer Laduma brand, and that fosters real loyalty.”

Clients above all else

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As the business has grown, a level of sophistication has grown alongside it. 310 000 weekly copies is a far cry from 23 000, and that growth is maintained through a level of understanding amongst Du Toit and his team of Soccer Laduma’s readers.

“What we do is only as successful as our understanding of our readers. We think of it as a relationship. The first encounter is simple: I like football. The second encounter is where we can start developing a relationship with a reader or user, and this is our job, not theirs. We need to understand them: Who they are, what they care about, what they need from us. They need to trust us as well — that we’re listening to them, understanding them, and focused on delivering to their needs. The work needs to be on our side; not theirs.

“I think it’s easy for businesses to forget this, particularly successful brands. You can easily start buying into your own hype and believing that you’re somehow doing your customers a favour. That should never be the case. They’re doing you the favour, and you need to keep earning that trust and loyalty.

“As with any relationship, real trust doesn’t come easily, and it should be cherished.”

The reality though is that as a brand, Soccer Laduma is trying to maintain a relationship with three million readers, which is no small task. In addition, advertisers are the company’s clients as well, and they have their own needs. Du Toit believes that the only way to achieve this is through authenticity.

“Once you’ve earned trust, people will accept mistakes if they know you’re authentic. We understand that people get bored. They’re growing and developing, and we need to as well. We need to reach new levels, incorporate new skills, deliver new offerings.

“Because our readers know we’re continuously striving to achieve this, they’ll accept a few stumbles along the way as well. We’re a community.

Related: ReWare Did One Crucial Thing That Most Entrepreneurs Are Too Afraid To Do

“I’ve put a score in incorrectly due to finger trouble. People noticed. I spent an hour responding to each of them individually. Almost everyone laughed and said no problem. It actually created a relationship with them. But if I’d left it, I shouldn’t be on twitter!

“It must be consciously done though. You need to have a system in place, as well as a culture that everyone believes in. Digital is of course easy to track, and we have a philosophy to always listen to our readers, which means we’re very responsive. It’s built into our DNA. Because of this, we learn so much, but it’s also clear that we’re listening, which goes a long way towards building and maintaining trust and loyalty.

“But digital and social media is also tough. It’s a different kind of content creation that evokes immediate reactions and requires quick response times. It’s emotionally more rewarding but it can also be more challenging.

“Social media is such a medium for knee jerk reactions, especially when you’re dealing with topics people are passionate about — and South Africans are passionate about football. We have to remember that they love us. That’s why they’re on our site. And they have a form of ownership over it; they’re emotionally invested. They have the right to say something. If you respect that, you won’t just react to criticisms, whether you see them as unfair or not. And if you do, then they have a right to get offended.

“We’ve found that the best way to handle online criticism is to step back and understand that it’s not directed at you. What is the person saying? Is their opinion valid? If you understand their viewpoint and the language they’re using to get that across, you can respond from a place of understanding. Something could sound bad, but they’re actually asking you for something.

“The website is the same. You need to think of it as your shop. If 100 people come in a day, your manager can’t treat them badly. You’re trained to give good service — but you get good and bad customers.

“Through our website we’ve opened our doors to thousands of people. Are your staff trained to deal with them? Think back to a bricks and mortar store. Is service fast, efficient, with no queues at tills? Imagine a scenario where the store is flooded with people all talking at the top of their voice. That’s the reality of an interactive website. And you need to treat everyone with respect or they will destroy your shop.

“Everyone is expected to have empathy towards our users, and to focus on their section of the site. That’s how we ensure community engagement and that we’re quick and responsive. It means a lot of trust, and that the whole team needs to share the same values and have the same voice, and that means working together as a close knit team, even as we grow.”

Learning to listen

Du Toit believes that most of Soccer Laduma’s growth is as a result of listening to its customers. “We created an internal unit, Brands Laduma, whose sole purpose is determining what our readers want and think: What’s important to them, their challenges, how articles and adverts make them feel. It’s not a division designed to generate profit, but rather feeds into our editorial team and also offers valuable insights to our advertisers.

“We’re able to give them feedback on which adverts delivered the message they were aiming for, which adverts fell flat and how our readers feel about their brands.

Related: 11 Uniquely South African Business Ideas

“Brands Laduma allows us to engage with our supporters in a deeper manner, and this led directly to the formation of Educate24. While engaging with our readers, we started digging into what is most important to them, and we discovered that education is high on that list. Education is seen as a status symbol. It leads to jobs and wealth, but it’s also often out of reach.

“If we really started evaluating our readers’ pain points, this was a big one: Qualifications cost money, but we can’t make the money to pay for the qualifications without having the qualification in the first place.

In the interim, The University of Cape Town had approached Soccer Laduma because they wanted to use the business as a case study for their MBA students, particularly given the level of engagement the company has with its readers.

“Through this engagement we started asking our readers new questions: What would people like from education? What courses will give them something now? What did they see as actionable skills?

“UCT Marketing Department found the study fascinating, and of course they can provide the quality and credibility to short courses to make them valuable for job seekers who cannot afford higher qualifications.

“Next, Media24 came on board, offering their support and input. Educate24 grew from our user base. This soccer business has given birth to something incredible for the needs of the people.

“Professors from around the country are involved, and the platform has been developed for online and mobile to increase its accessibility. It’s also affordable for the people who it can help the most.

“This has been the most incredible journey for me. It’s taken two years to come together, but it’s also shown what you can achieve when like-minded people come together to solve a real need. We posted two adverts and received 13 000 enquiries, proving that the need does exist.

“We also assist with CVs and psychometric tests, which have been provided for free because the companies want the research they provide. It’s a win-win for everyone involved. I know nothing about education. I did one year of university and failed. And yet here I am, hopefully playing one tiny part in improving thousands — hundreds of thousands — of lives. For me, that’s what entrepreneurship is about, and I hope we continue to find new ways to add value long into the future.”

Nadine Todd is the Managing Editor of Entrepreneur Magazine, the How-To guide for growing businesses. Find her on Google+.

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Going The Extra Mile With Neil Robinson Of Relate Bracelets

In business, your offering is only as good as your relationships. Neil Robinson from Relate Bracelets explains how FedEx Express has helped the business grow into Africa and beyond.

FedEx

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Vital stats

  • Who? Neil Robinson
  • Company: Relate Bracelets
  • Position: Managing Director
  • Visit: relate.org.za

Neil Robinson, MD of Relate Bracelets understands the importance of business relationships. While Relate is a non-profit organisation, it is run like a business. It does not rely on donors, but instead produces and sells a product.

For each bracelet sold, one third of the income goes towards the materials and operating costs, one third supports the people who produce the bracelets, and one third goes to the charity for which that particular bracelet is branded.

In order for the business model to work and be sustainable, Relate’s partners are incredibly important. These include the retail chains that stock the product and who provide prime point-of-sale positioning, the charities who Relate works with, and most importantly, Relate’s logistics service provider, FedEx Express.

“Retail is all about visibility and availability,” explains Neil. “A brand is a living, breathing thing. People can see it, use it, and comment on it, but if they can’t access it, it’s all for naught. And so, at the point of purchase, it’s both visible and available, or it’s not.

“Logistics is key. You need to get your product to the retailer on time, 100% of the time. The expertise and focus that FedEx displays in supply chain and logistics encompasses far more than just retail, they understand our specific needs, making them a strategic partner, rather than merely a supplier.”

Related: Zenzele Fitness’s Clever Tactics To Grow In Next To No Time

Building a relationship

The FedEx/Relate Bracelets relationship stretches back to 2009, when Relate Bracelets launched its first campaign with ‘Unite Against Malaria’ leading up to the 2010 FIFA World Cup.

“We did the first campaign in partnership with Nando’s,” says Neil. “Robbie Brozin was passionate about the cause, and he pulled in strategic partners to launch the campaign. Within two years we’d shipped hundreds of thousands of bracelets. FedEx was an incredible partner, ensuring the integrity of our product and time-sensitive deliveries, and we’ve worked with them ever since.”

As with all good B2B relationships, the FedEx and Relate Bracelets teams understand that regular strategy sessions and updates are important.

“FedEx understands the inner workings of our business,” says Neil.

“A successful campaign has multiple elements, from planning and strategy, to marketing support, pricing and distribution planning. Of these, distribution planning is the most critical. For us, the bridge between our brand and the consumer is logistics. FedEx have delivered beyond expectations. They literally and figuratively go the extra mile for us.”

Protecting a brand

FedEx has customers across different industries and each of their needs are different. In the case of Relate, who operate in the retail sector, buying patterns are important. “Retailers run a tight ship,” explains Neil.

“They have planning cycles and seasons. Besides the fact that penalty clauses are built into contracts, you can’t miss a deadline by two days, or you’re in the next cycle, and that might be two weeks later. Not only are you missing out on valuable shelf time, but this can affect an entire campaign. Lost sales can also influence the retailers’ buying decision the following season. FedEx has made it their business to understand our business, so they know what’s at stake and what’s important to us.”

Supporting growth

FedEx has also played an integral role in the overall expansion of Relate Bracelets, particularly into new markets. “As a global organisation, FedEx has been absolutely critical in supporting us to grow our business into Africa, the US, Australia, the UK, Western Europe, and now New Zealand. They play an enormous role in the delivery of our products, with sophisticated tracking systems ensuring that the quality and integrity of our products are maintained.”

Through the relationship with FedEx, Relate experiences the benefits of working with a globally recognised and credible brand. “When you work with quality, you get quality.”

Related: Entrepreneur BB Moloi’s Inspiring Story of Rise To Success Through Grit And Hard Work

The business

If you’ve ever bought a beaded bracelet that supports a cause (for example: United Against Malaria, Operation Smile SA or PinkDrive), chances are it was a Relate Bracelet. If you bought it at Woolworths, Clicks, Sorbet or Foschini, it most definitely was.

To date, Relate Bracelets has raised more than R40 million, which supports various charities and ‘gogos’, women living on government grants and supporting their grandchildren, and who desperately need the additional income Relate Bracelets provides.

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Entrepreneur Profiles

Slikour’s Moto: If You Dream It, You Can Be It

Rapper and entrepreneur Slikour believes his success is the result of one key element: The aspiration to make something of himself, and create a platform for his voice to be heard. Now he’s bringing that mindset to South Africa’s black urban youth.

Nadine Todd

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VITAL STATS

Take note

Before you can achieve great success, you have to believe in the possibility of success. This is the single greatest secret to changing your circumstances — you have to believe it’s possible.

Did music or entrepreneurship come first? Siya Metane, aka rapper Slikour, isn’t sure himself. The two have worked hand in hand for him since he started selling cassette tapes of his own music when he was 12 years old.

What has developed over time however, is an innate and deep understanding that with his success comes a responsibility to pay it forward, and help his community and kids like him see that they can be anything they put their minds to.

Related: 10 SA Entrepreneurs Who Built Their Businesses From Nothing

If they can dream it, they can be it — provided they realise they can dream it in the first place. This is his challenge, and greatest driving force.

Start small, but dream big

I bought cassette tapes on Smal Street in the CBD for R5. My best friend, Lebo and I recorded our own rap music onto them and sold them in our neighbourhood for R15. We needed the mark-up — it meant we could buy more tapes, and also that we were making a profit.

Related: Zuko Tisani Learnt These 7 Invaluable Lessons On His Path To Success

I’m not sure if we were trying to start a business or launch our rap careers, but if you’re living in a hood like Leondale you don’t always recognise that there are opportunities open to you. No one is going to do it for you — you have to have your own aspirations, and find a way to make them happen.

Keep dreaming big, no matter what

That was one of the biggest and earliest lessons I recall growing up: The ability to dream big can be stifled out of you. I lived in a hood where there were no aspirations past our neighbourhood — the neighbourhood and its opportunities were everything. If 90% of the people you know are suffering, who are you to not suffer?

It’s a very limiting mindset, and one that does a lot of damage to our youth. I knew kids who had incredible potential, but could only look at their immediate environments for opportunities. So a budding young scientist doesn’t find a way to change the world — he finds a new way to make drugs.

Those are the limiting aspirations I was surrounded by. I call it the Trap, and it’s the driving force behind everything I do today. I want South Africa’s urban youth to recognise the Trap, and understand that they should have aspirations beyond it, because they have the abilities and potential necessary to break free.

Work hard, be determined and believe in yourself

I was lucky, I wasn’t a victim of the Trap. What so many people don’t understand is that I could have been. Hard work, drive and discipline aren’t enough to break free of the Trap. You need to believe you can break free — to look beyond your current circumstances. In my experience, that seemingly simple mindset shift is the biggest hurdle to overcome. It’s more complicated and pervasive than you can imagine.

Two things showed me a different way. First, my mom got me bursaries at Holy Rosary Convent and then St Benedict’s College. I was surrounded by rich white kids, full of privilege, and it struck me that here were the same talents and opportunities, but with a wealth of aspiration in the mix.

Related: Self-Made Millionaire At 24 Marnus Broodryk On How To Build A R1 Billion Business

That was the real difference — not ability, but recognising that ability and having the aspiration to do something with it. It was eye-opening. The second was meeting my best friend, Lebo Mothibe. Lebo, or Shugasmakx, as he’d later be known in the music world, had one foot in the privileged world, and one foot in our world.

His mom lived in the hood, his dad was a wealthy entrepreneur who lived in Illovo. And Lebo straddled both worlds effortlessly, and with humility. But he looked beyond the limiting beliefs held by many of his neighbourhood peers.

Find people to inspire you to reach success

His dad was also the first self-made, wealthy black man I met. But when I heard his story, I realised that it wasn’t overnight success. He’d slept on Lebo’s mom’s couch while he slowly but steadily built his business. It gave me an understanding that success is earned. You need to work at it, and push on against adversity. This had a huge impact on me.

Lebo was the ying to my yang. Even though we didn’t think of each other as business partners, that’s what we were, from the age of 12. We formed Skwatta Kamp, we hustled and shook up the music industry together, and changed the face of rap music in South Africa.

I was the dreamer, the visionary, and Lebo was the executor. He found a way to make my crazy schemes and ideas come to life. This is exactly what a partnership should be — helping each other grow, and complementing diverse skill sets.

Build your success, one step at a time

We built our success, brick by brick. I entered a TV show competition, Jam Alley, and won. I used the cash and Dions vouchers to buy recording equipment. Lebo’s dad helped with speakers and a keyboard. My brother, who was studying IT, downloaded software and helped us with our recording quality. Everyone pitched in with what they could. 

Be your own biggest cheerleader

We tried the recording contract route for a while, but realised that the only people who cared about our success were us. And so we hit the streets — hard. We had street crews, we sold our own CDs and negotiated with music stores to carry our albums.

Recording studios kept saying they’d sign us, but they never had a studio available. They just didn’t see the value in rap and hip hop. They didn’t believe there was money in it in South Africa. We needed to prove there was.

Gallo finally approached us and signed us after we won at the South African Music Awards (SAMAs) as an independent act. We used real guerrilla tactics to get our name out there — on stage, with that platform, we told our fans that if a music store didn’t carry our album, to burn it down. We wanted the attention — that’s how you build a name.

Related: Entrepreneurial Powerhouse TBO Touch On How Success Is Built From Small Acts

Our first album went gold, and we used that to push the idea of rap into mainstream media. If 20 000 people bought the album, another 200 000 had bootlegged it. There was money here; and slowly brands and advertisers started realising we were right.

Drive a movement with your business

We were musicians, but first and foremost we were driving a movement, and that meant we needed to be businessmen as well. We hosted end of year parties, and got brands on board, realising we had a captive audience that aligned with their target market demographics. We started our own label, Buttabing Entertainment.

Our goal was to find and nurture young musicians from the hood to get them established in the industry, and show other kids in the Trap that it could be done: Anyone can create their own destiny. One of the things I’m proudest of is discovering a kid in Katlehong, Senzo Mfundo Vilakazi, who would develop into Kwesta.

He’s doing phenomenally well, and recently appeared on Sway in the Morning, one of the biggest hip hop shows in the US. Our success spilt over into Kwesta, and now his meteoric rise will hopefully inspire a whole new generation to dream bigger than they ever thought possible.

Pivoting to further growth

All success has its pinnacle. By 2010 we had achieved so much as Skwatta Kamp. We’d brought rap music into the mainstream and opened opportunities for countless kids, as music labels actively sought rap and hip hop acts. I realised that I’d hit a ceiling. I needed to step back, regroup and figure out what to do next.

What I did was something I’ve only ever associated with privilege. I moved home, spent a lot of time lying on the couch, and wrote. I wrote my life, my lessons, my dreams, my ideas. I don’t know how I reached a point where I was able to do that, but I’m grateful. I started collecting my thoughts and understanding my purpose.

During that time I was approached to join a few marketing agencies. I had no formal marketing training, but we’d worked with big brands at our parties and activations.

Sprite was the first to recognise that they had an opportunity to authentically connect with the black urban youth through us, and so we partnered up. I learnt above-the-line marketing in a Coca-Cola boardroom, and built onto what we’d learnt on the streets about below-the-line marketing.

Take a step back, and rediscover your purpose

That experience had drawn attention, and so for a while I joined an agency. But its mandate was sponsorships, and my heart was with the black urban youth. I’d discovered my purpose, even if I’d subconsciously been living that purpose for almost 20 years.

I wanted to create a platform that gives young black artists a voice; established artists a way to reach out to the youth that other platforms don’t offer; and brands a way to authentically connect with that audience — not just to sell products, but to show black urban youth that their culture is important, that it holds value, and that they, in turn, hold value.

Related: Shark Tank’s Romeo Kumalo Weighs In On High-Impact Entrepreneurial Businesses

Adidas’s support of Run DMC in the US showed that kids from the ghetto had a message worth listening to. Big brands have the power to connect the unheard and voiceless to the mainstream, if it’s done correctly. I had the marketing experience to understand the ROI that brands need, as well as what I could do with that to support black urban youth.

All I had were dreams and a URL, but that was enough. I quit my job and launched my website, Slikouronlife.

Reveal opportunities and create aspirations with your message

This is my politics and CSI. If we can get marketing to marry culture, and change the positioning and perception of young black South Africans, we can show there are opportunities out there, and create aspirations.

But we need to put culture first and tap into the authenticity of who we are as South Africans. We need to recognise and acknowledge the mental traps that exist in our neighbourhoods, and that we are victims of limiting beliefs, and then show that there is another way.

Everyone told me I was nuts. That black people don’t go online. I did it anyway. With Skwatta Kamp we had created a market for our music. Kids supported us; my name added value — and then brands came on board. We now average between 200 000 and 250 000 unique visitors a month, which is impressive for a mainstream website, let alone a niche music site.

Ten months ago we were a team of three operating from my house with one desk. Today we’re a team of ten with one focus: To make a real difference on the ground. To give the voiceless a voice. To prove that if we can drive the aspirations of South Africa’s urban youth, the sky will be the limit.


Related: Watch List: 50 Top SA Small Businesses To Watch

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Entrepreneur Profiles

Edward Moshole Founder Of Chem-Fresh Started With R68 And Turned It Into A R25 Million Business

Edward Moshole started a business in 1999 with just R68 in his pocket. Today he has a company that not only has a turnover upwards of R25 million, but is also on the cusp of expanding to the next level. Here’s how he’s turning clients into partners.

GG van Rooyen

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Vital Stats

In 1999, Edward Moshole was a cleaner with just R68 in his pocket, but he noticed a business opportunity.

Good quality detergents and disinfectants could make a tough cleaning job much easier, so he started buying quality products in bulk and selling them to his fellow cleaners. He wasn’t satisfied, though. He wanted a business that made and sold its own products. So, he tackled the long and arduous process of creating cleaners and detergents that could pass strict regulations and compete with the best products on the market.

It wasn’t easy, but he kept at it. In fact, he only got his first real breakthrough in 2006 when a supermarket agreed to start stocking his products. Today, his Chem-Fresh products can be found all over Africa, and he counts Pick n Pay as one of his main clients. How did Moshole manage to turn R68 into an empire?

Here are his rules for building a large and sustainable operation.

1. Find the right clients

“Very early on, I identified Pick n Pay as a must-have client. I could see that the company was changing its strategy — it was starting to move into townships and rural areas, places where it hadn’t been operating until then — and I thought it would be the perfect place to sell Chem-Fresh products,” says Moshole. But getting in wasn’t easy.

“As a small business, you don’t get to sit down with decision- makers. Becoming a supplier to a large retailer is a difficult process. It took me years to get a foot in the door, but I didn’t give up. I just knew that Pick n Pay was the right company to do business with, so I kept at it.

I refused to take no for an answer. Today, Pick n Pay operates more like a partner than a client.

Related: Attention Black Entrepreneurs: Start-Up Funding From Government Grants & Funds

Thanks to my partnership with Pick n Pay, I’ve been able to scale Chem-Fresh quickly and access a distribution channel that allows Chem-Fresh products to be sold all over the continent. Once you have the right clients, you gain instant clout and reliability.”

2. Own the manufacturing process

chem-fresh-products

PC: risingafrica.org

When starting out, entrepreneurs often have little choice but to buy other companies’ products and resell them. It’s not necessarily a bad thing — it can be a successful strategy. However, it can eventually limit your growth.

Firstly, buying and reselling products places a cap on your margins. When you own the manufacturing process, you can increase your margins, since making and selling products tends to offer wider margins than merely buying and reselling.

That said, you have to keep in mind that this is only true when you operate at a certain scale. Making and selling something in small quantities can often be more expensive and time consuming than simply buying it from a supplier. You need to crunch the numbers and make sure that the expense of a manufacturing facility is actually worth it in the long run.

Secondly, it allows you to keep control of the quality of your product. “The secret to any great brand is consistency,” says Moshole.

“People should know what they can expect from the brand, and one of the best ways to ensure this is to have total control of your product. If you make it yourself, you’re in charge of the quality.”

3. Be willing to diversify

Some companies can grow while sticking to a very specific niche, but most have no other option but to diversify. Although Chem-Fresh started out selling just one or two products, Moshole soon started to expand the range. The company now has more than 100 products.

“Generally speaking, you can only capture so much of a market. Sometimes it makes sense to actively try to grow your market share, but it’s also a good idea to diversify. Not only does this open more revenue streams, but it also protects the business against market changes. So, if the sales of one product slows down, another speeds up and everything evens out,” says Moshole.

Related: Sibongiseni Mbatha’s Top Collaboration Techniques To Grow Your Business

But the important thing is not to stray too far from your comfort zone. Chem-Fresh now has a large product range, but it has stuck to an industry that it is knowledgeable about. The company has built a name for itself within a specific industry.

4. Build a strong foundation

“Don’t wait too long to start thinking about the long-term life of your business,” advises Moshole. “The stronger the foundation of the business, the easier it is to grow it, so you need to implement the right systems and processes early on. If you don’t, the business will fall apart without you.

“You will always be very involved at an operational level. You’ll be so busy with the daily grind, that you’ll never be able to take a strategic view and focus on building the company.

So, you need the right systems and the right people. You need to know that the business can keep going without you. If you do this, you will be able to grow the company while others deal with the operational demands.”


Key Insights

There’s no substitute for perseverance

It took Edward years to get his product onto Pick n Pay’s shelves, but he wouldn’t take no for an answer. Today, the relationship is more like a partnership.

Own the process

In the right quantities, producing and selling your own product can significantly increase your margins over selling someone else’s products.

Strategically increase revenue streams

Diversifying your product range within your niche allows you to offer the same clients a greater range, tap into new markets, and protect the business against market changes.


TAKE NOTE

Take a long-term view when contemplating the growth of your company. It’s never too soon to prepare a business for growth. Implementing the right systems and processes right now can make it much easier to scale the operation down the line.


Related: 6 Of The Most Profitable Small Businesses In South Africa

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