From his glass-fronted office at the exit of the Pretoria-based Kit Kat Cash & Carry store, Ahmed Gani, MD of Kit Kat Group, waves to customers and suppliers as they leave. “I want to see that nobody looks unhappy as they walk out. I want them to see me so that at least our eyes can meet and we can greet each other,” he explains. It’s a hands-on approach that has come to epitomise what this up-and-coming business is about.
Started as a corner café by Gani’s grandfather and great uncle in 1953, Kit Kat Group has grown to incorporate the Cash & Carry outlet, three retail outlets and, this year, the first of many franchise outlets. Gani describes the opening of the 20 000 m2-plus Cash & Carry outlet as a “humungous” step for the family. “Being a privately owned business, money comes in limited amounts, but we’ve always run a very tight ship with low overheads, good stock turns and quick turnovers.
“And that enabled us to build up a reasonable amount of capital in our family so that the business has always carried itself,” he says of how the growth has been funded. In spite of its growth and success, Kit Kat has managed to retain all the benefits of being family-owned. “The pros far outweigh the cons of being a family business,” says Gani, explaining that independence and the lack of corporate ‘red tape’ gives the company the flexibility to react quickly to market demands in order to stay a step ahead of its competitors.
However, the pitfalls of family-owned businesses are well-documented. All too often, they are too democratically run and lack a ‘buck-stops-here’ boss. As they grow, family members, long-used to signing off on everything, battle to relinquish control of operations, stifling future success potential. Or a wayward son or grandson with a big ego and a small business brain ruins what it took his fore fathers years to build.
The Gani family has managed to avoid such pitfalls by implementing strict systems that ensure that the way the business is run won’t fluctuate too drastically depending on who sits in the boss’s chair. “The boss is the system,” says Gani, explaining that the family has devised a proven set of systems over time to which family members, management and staff alike are expected to adhere.
On the question of delegating tasks and decisions to empowered managers, he says simply, “If you can’t share, you can’t grow.” All family members, from Gani as MD to his brother and cousin who occupy positions as financial and merchandise directors, have done their time on the shop floor.
“The advice I would give to any family-run business is that you can’t take a family member and put them at the helm of the business if they don’t understand what it is about and haven’t been through every category of the business.” Apart from internal operational challenges, Kit Kat is up against it when it comes to the size and sheer clout of their competitors. But, as Gani explains, their hands-on approach has stood them in good stead here as well: “Customers see the value of dealing with hands-on type operators. If you are not satisfied you can meet the MD of the company in a minute and we can immediately try to rectify things so that you leave here as a happy client,” he explains.
The same applies to suppliers, and Gani lists integrity and supplier relationships as key factors in the company’s success: “A lot of suppliers feel cornered by the large chain groups so they look for outlets of our type to leverage themselves and get into the market without being dictated to too much.
We build up good relationships with suppliers over time.” That’s not to say that healthy negotiations with suppliers don’t form a solid base to the business and, as Gani points out: “In order to sell competitively you’ve got to buy competitively so when we sit across a table and do a deal, we fight to get the best possible price, structures and payment terms but once we shake on it, we honour it.
If I tell a supplier he will be paid on the 15th of the month, on the 14th he’s got his money.” It’s obvious that in spite of being small by comparison, Kit Kat is making an impact in the market. In the past year, two different chain groups have attempted to buy the business out, but Gani is having none of it.
With big plans for the future, he wants to keep the business independent. The opening of at least four new Cash & Carry outlets in Gauteng, and 25 franchises over the next two to three years, are just some of the plans in the pipeline. His answer to buy-out offers were, “No thank you. We are not for sale. But look out for us within the next five years – I might be coming to buy you out.” They may prove to be prophetic words. Contact: 0861 548 528, www.kitkatgroup.com
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