September 2014 // Volume 2 No 8&SHOPPING

Southern Africa

shopping & retail SA // September 2014 cover

The SACSC Footprint Marketing Awards recognise exceptional shopping centre marketing, innovation and creative achievements, with economic success.

Cavendish Square stole the show by earning the popular Spectrum Award for marketing excellence for “The Exchange”, an initiative for the Organ Donor Foundation of SA. The Exchange was the world’s first pop-up fashion boutique at which money was not accepted, but fashion from SA’s top designers was exchanged by registering as an organ donor.

“The Exchange” project was selected from all the Gold Footprint Marketing winners as the overall winner in recognition of overall excellence in the industry.

Cavendish Square won five of the 12 Gold Footprint Marketing Awards which were awarded to Primedia Lifestyle, for its marketing campaigns.

In addition to The Spectrum Award, Cavendish Square’s The Exchange won a gold in the advertising category, it also received two gold awards for its Taste of Winter in the sales promotion and events category as well as the

public relations category, its advertising of Guilt & Ganache intrigued judges, and the “Introducing New Tenants” campaign won in the leasing support category.

This year’s winners were judged to a global standard and can stand proud with top shopping campaigns worldwide.

Exciting news is that for the first time this year, all SACSC Footprint Award Gold winners are automatically entered into the International Council of Shopping Centres’ Solal Awards. This global awards campaign is set to be judged in March/April 2015.

Cavendish square sCoops Marketing excellence award At the recent annual Footprint Marketing Awards, the South African Council of Shopping Centres (SACSC) awarded 12 Gold, 10 Silver and 15 Bronze awards out of the 44 awards of the evening to the Primedia Lifestyle Group.

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I’ve spent a lot of time travelling and road tripping to smaller towns in South Africa and it’s when you visit the back waters that you realise two things about retail. One is how lucky we are in the big centres to have access to such a wide range of goods and products from around the world.

But we also realise how much poorer we are in terms of unique products, cottage industries and the joy of homemade products. Hand crafted pewter jewellery made with love and care, home baked bread and rusks from a tannie’s kitchen.

In these small towns there are no franchises, no big name stores, it’s all unique and all it’s all a lucky packet voyage of discovery. Some good and some bad of course. I’m not saying it’s

better but it just reminds me of the need for balance in retail. The need for homegrown and proudly South African products that invest back into our country and don’t line the pockets of people in far off places.

You could call it a wakeup call. We need to think about the bigger picture.Not just the short term else the long term in retail is going to be bleak.

Bernadette

EditorBernadette MaguireCell: 071 607 0020

E: bernadette.ck@gmail.com

PublisherKen Nortje

E: ken@malnormags.co.za

Sales ManagerSophia Nel

E: sophia@malnormags.co.za Advertising/Sales

Yolandi GeurtseTel: 011 726 3081Fax: 011 726 5911Cell: 072 379 4924

E: yolandi@shoppingandretail.co.za

Advertising/SalesMarius Nel

Tel: 011 726 3081Fax: 011 726 5911Cell: 083 281 3099

E: marius@shoppingandretail.co.za

DispatchWillie Molefe

AccountsChrista Buys

Tel: 011 726 3081/2 Fax: 011 726 5069

E: accounts@malnormags.co.za

Subscriptions and CirculationNolene Eckersley

Tel: 011 726 3081/2Fax: 011 726 5911

E: nolene@malnormags.co.za

ProductionJohan Malherbe

Meinardt TydemanJenny van Lelyveld

Patrick Letsoela

Design and layoutCecilia Goto

editor’s note

contentsSeptember 2014 // Volume 2 No 8

PUBLISHED AND DISTRIBUTED BYMalnor (Pty) Limited

2 Hermitage Terrace, Richmond, 2092, Private Bag X20, Auckland Park, 2006

Tel: 011 726 3081/2 Fax: 011 736 3017E-mail: magazines@malnormags.co.za

www.malnormags.co .zaB-BBEE LEVEL 2

Southern Africa&SHOPPING

shopping & retail SA // September 2014 Page 1

Cavendish Square scoops marketing excellence award

Introducing the new face of Menlyn Park Shopping Centre

Pam Golding on Main in Kenilworth rapidly taking shape

Newtown Junction – preserving Joburg’s heritage and bringing new life to the city

New shopping centres: are we building too big too soon?

Refurbishment of Rustenburg Waterfall Mall

Strong women in franchising - this business is not just for men anymore

Standard Bank report confirms strong growth in Africa‘s rising middle class – and even faster future growth

Introducing Flora Centre as a potential site for your brand

Engen is the Number One petrol station brand 4 real!

Cotton On Group earmarks South Africa at the epicentre of its African growth plans

Staff will make or break new tech

Future success of commercial property security lies in technology integration, says Enforce Security Services

Local artists impress with outstanding creativity at Middelburg Mall’s annual art competition

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Cover

News

Technology

Out and About

Africa Focus

Franchise

Retail

Security

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Page 2 shopping & retail SA // September 2014

Menlyn Park Shopping Centre is undergoing a major redevelopment, including a massive expansion and refurbishment, to become one of the largest malls on the continent and in the southern hemisphere, with over 500 shops. To match its iconic status and premium shopping, fashion and entertainment attractions, it is also introducing a new brand identity.

Menlyn Park Shopping Centre is equally co-owned by Pareto Limited (Pareto) and Old Mutual Life Assurance Company (South Africa)

Limited. Together they are investing R2 billion in this forward-thinking development for the mall.

The two-phase project, which is being led by retailer demand and growing shopper support, will add approximately 50 000 m2 and 200 more stores to the centre. It will also create exciting new diverse retail and entertainment areas in the mall. Construction commenced in April 2014, with the entire project scheduled for completion in November 2016.

Menlyn Park Shopping Centre’s refreshed branding is inspired by the mall’s fashion-loving shoppers, and the many fashion brands housed

in the mall. It hosts one of the greatest fashion brand collections in Africa and has become synonymous with everything stylish and trendy.

Aligned to the redevelopment vision, Menlyn Park Shopping Centre’s new brand will change the face of this iconic mall and take it into a new era, and its new logo will reflect its heightened fashionable status.

“The Menlyn Park shopper is fashion forward and appreciates quality design,” says Marius Muller, CEO of Pareto. “We believe they’ll appreciate the sophisticated new brand, which is aligned with the mall’s iconic status, as well as the unique and quirky imagery that evokes Pretoria and is also distinctly South African.”

While the mall will proudly wear a new badge as it steps into its bright new future, it also retains a respectful tribute to its rich past.

“For those who’ve grown up in Pretoria, Menlyn has been a part of their childhood and is the venue of many shared memories and stories,” explains Peter Levett, CEO of Old Mutual Property.

“Menlyn is not only a landmark in Pretoria, but is synonymous with the things that make us feel good and look good – entertainment and fashion. It has gained iconic status over the past 35 years and we felt it was important to pay respect to this with the new brand identity.”

The ‘M’ in the new logo will still reflect the architectural features of the mall, as the previous one did. However, they now form a unique symbol crowning the beautifully crafted, and distinct Menlyn logotype.

Besides the new logo, Menlyn has created a library of unique and distinctly Menlyn images

across a variety of themes that will be used in all artwork, replacing its former use of royalty-free stock images.

A celebration of its city, each image contains a backdrop designed from elements within the capital city, forming some unusual and highly individual patterns.

“The people in the images are all real Menlyn Park Shopping Centre fans, which makes the artwork a completely authentic reflection of our shoppers, our city and gives it a unique South African flavour,” says Muller.

Levett adds, “As we take Menlyn Park Shopping Centre on this exciting journey into the future for our shoppers and retailers, it is fitting that we also introduce a new brand identity to carry the image of this unique mall forward too.”

news

introducing the new face of Menlyn park shopping Centre

Situated in a bustling commercial node on the corner of Main and Summerley Roads and comprising a gross lettable area of 4100 m2 in total, plus 185 parking bays, the

project is well on track for final completion in May 2015, says Peter Golding, who is project managing the upmarket redevelopment on behalf of the Pam Golding Property group.

Tenants already secured include national retailer Pick n Pay, which will occupy 450 m2 on the ground floor for its new small-store offering, which will include a coffee shop and bakery, among other enticing attractions, and Pam Golding Properties, which will occupy just over 1 000 m2 - comprising the entire first floor and some retail space on the ground floor.

Says Laurie Wener, MD of Pam Golding Properties (PGP) in the Western Cape’s Cape Town Metropole: “We are looking forward to seeing our southern suburbs flagship office returning to its former ‘home’ on this high-profile, redeveloped site in mid-2015.

“Incorporated in this new space will be our extensive sales team for the area, as well as our southern suburbs residential letting department and Cape regional suite of offices and service departments supporting our Western Cape operations.

“Visitors to our brand new offices will enjoy the convenience of ample, secure underground parking with elevator access to the lobby and PGP offices, with elegant interiors for the comfort of our clients and state-of-the-art property displays,” she says.

Peter Golding says the response to the launch of Pam Golding on Main has been extremely positive: “The development has attracted considerable interest and the only retail space still available is approximately 280 m2, being allocated for a restaurant on the corner, and one adjacent shop. For the restaurant we envisage a vibey establishment spilling out on to a spacious pavement area and which will serve three meals per day, catering for office staff in the vicinity as well as local residents.

With two other restaurants, Jakes on Summerley and Borruso’s close by, our aim is to help foster an inviting ambience which will create a lively streetscape with al fresco dining after working hours.” The rental rate of the retail space is R200/m2.

Golding says the remaining office component of the building allows for up to 12 office units, ranging in size from 84 m2 to 2 100 m2 in total or approximately 1 000 m2 per floor.

“Located on the second and third floors, this is ideal for businesses seeking top quality office accommodation.”

shopping & retail SA // September 2014 Page 3

news

pam Golding on Main in Kenilworth rapidly taking shapeAlready at ground level, with all three floors of basement parking completed, construction work is progressing well on the prominent site of the new P-grade (or AAA grade) office and retail building, Pam Golding on Main in Kenilworth, Cape Town.

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The development is situated right in the middle of Newtown’s cultural district next to the Museum of Africa and the striking 1913 Edwardian building that was redeveloped into

the popular Market Theatre.

Developed by Atterbury Property, Newtown Junction signals both the growth of Johannesburg’s city centre as well as the renewal and revival of the city in a way that preserves its heritage and history.

Construction commenced in October 2012, with completion set for the end of September 2014.

Aurecon played the role of structural engineer on this landmark project, bringing to the table a wealth of knowledge around the complexities of working in the Johannesburg Central Business District environment as well as an ability to ramp up significant project resources at short notice.

The R1,3 billion development is backed by the Johannesburg Property Company (JPC) and has seen the South African Heritage Resources Agency’s (SAHRA) inputs carefully considered, due to the historic nature of the site.

“Mixed-use developments often dictate working with a complex design team. On this project, this included three architects, ie retail, commercial and heritage. It was essential that Aurecon build strong relationships across these

teams, as well as develop construction efficient solutions to expedite the tight programme,” says Stoffel Mentz, Aurecon Project Director and Structural Engineer.

He goes on to say the new development displays a very unique design. “The project team under the guidance of DHK Architects took particular care in creating a structure that connects the past, present and future with vibrant flair, making it an exciting place for people to work, shop and eat in one of South Africa’s most compelling economic hubs.”

Newtown Junction’s retail area includes a portion of the steel warehouses (potato sheds) that were originally designed in 1910 for the purpose of storing vegetables and fodder that were distributed to fresh produce markets across the country by rail.

“There are four basement parking levels, two retail levels above the parking as well as three levels dedicated to office space above the retail portion. A portion of the building was constructed under the elevated M1 highway, which required a very unique geometry in order to accommodate the highway piers,” says Mentz.

“Some sections of the structure’s roof are only 3 to 4 m below the structure of the M1 highway above. Furthermore, the floor level of the lower retail level is up to 3 m below the founding levels of the highway piers and columns. This meant the project team had to

isolate construction while building around existing highway piers and columns. What’s more, we had to design lateral support systems to protect the bridge piers, ensure that the safety of motorists was not jeopardised as well as design a roofing system that caters for storm water flooding from the highway in these areas,” explains Mentz.

Coupled to this, the project site was founded above huge amounts of ground water, with excavations that plummet down to 15 m below the ground’s surface. This required the project team to remove approximately 1 500 cubic metres of water per day from the foundation levels.

“In order to streamline this task, Aurecon designed a series of subsoil drainage systems that collected water under the entire basement footprint, and then funnelled the water into sumps, before pumping the water into the municipal storm water system at ground level.”

“The same series of pumps now forms part of the permanent structure, and also functions as a mechanism of handling excess storm water resulting from the access ramps into the basements during rainstorms,” says Mentz.

He also explains that without this innovation, rainfall would create a pool of water on the access ramps and end flooding thebasement parking areas. The newly designed storm water system has eliminated this problem permanently.

Besides ongoing changes to the layout of the retail area of the mall, which is typical of any retail project, six movie theatres were also incorporated into the project a year before the project’s projected completion.

Aurecon’s project team had to redesign the internal structure of the building to accommodate these changes and make sure that deadlines were met.

“The specialised theatres required custom sound insulation solution due to their proximity to the highway. In order to muffle the sound of the neighbouring traffic, high tech insulation was installed in the theatre areas under the guidance of acoustic experts. We also fast-tracked the design of two of the theatres to ensure that they were fully functional when the mall opened,” says Mentz.

Newtown Junction is a unique and bustling hub that will bring new life to the surrounding precinct. Coupled to this, the heritage-inspired design will make it a go-to destination for the people of Johannesburg as well as tourists.

“Newtown Junction’s design successfully retains the magic of the past, blending it with the excitement of the future, and will become an important landmark in the city centre. Aurecon applauds the developers for this bold, ambitious project and is proud to be involved in this landmark development,” concludes Mentz .

Page 4 shopping & retail SA // September 2014

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Newtown Junction, located in the heart of Johannesburg’s Newtown Precinct, will see the long-neglected “potato sheds” transformed into a vibrant, mix-used development that will comprise a 36 000 m² shopping centre, 30 000 m² of office space, gymnasium and four levels of basement parking providing 2 400 bays.

newtown Junction – preserving Joburg’s heritage and bringing new life to the city

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Page 6 shopping & retail SA // September 2014

He adds that while some will quickly progress beyond these growing pains to become thriving retail successes, others may not be sustainable.

“The success of a shopping centre has as much to do with site selection as it does with execution from its developer,” explains Muller.

“Right now, the listed property sector is hungry for chunky retail development, but cannot find high quality stock in the market. So, they’re dipping into the next tier and creating demand for B-grade retail property at keener yields than found previously. Developers are aware of this demand and putting it out there.”

This is resulting in some developers delivering shopping centres that are oversized or too far ahead of market support. Muller believes this brings the long-term sustainability of some of these malls into question.

Muller explains that shopping centres are usually brought to market some degree ahead of consumer support. This model, although not without early challenges, has resulted in some of the country’s most successful malls. Muller cites Canal Walk Shopping Centre in Cape Town and Gateway Theatre of Shopping in Umhlanga, as centres which entered their markets well ahead of consumer support and at sizes that were not sustainable when they first opened. As a result, they were met with challenging trading in their early days. “But, as their markets grew, these centres were right-sized. Now, they are growing with their markets and are star performers.”

Muller believes the massive 120 000 m2 Mall of Africa, which is due to open in Waterfall City, Midrand, in 2016, may experience a similar pattern as its shopper market grows, but will ultimately be successful.

However, he is concerned that some South African malls are being brought to market way ahead of their time in terms of market support.

“There are cases where delivery to market is far too early, because there does need to be some market demand. There are malls being built

too far ahead of time and too big. In one case, a significant portion of one such development has had to be mothballed,” points out Muller. He notes that large retail developments in the Eastern Cape are of particular concern in this regard.

Muller believes that most new retail developments would be better off taking a more cautious approach in the current economic climate, starting off around the right size for the available market, and then growing in a phased approach, as market support grows. This phased development strategy has proved highly successful at a number of local malls, and mitigates the risk of early slow trading.

He adds that national retailer expansion strategies are also impacting the wave of new retail space coming to market.

“While some retailers like Shoprite have made it clear that its growth will not see it cannibalising its own stores, others are less defensive of their existing outlets. As profit margins are being squeezed, they are hoping to offset this with greater turnover. This is resulting in retailers expanding their footprints because their competitors have, or to shut out competitors, which doesn’t always make sense. More stores are not always the answer and can sometimes result in little gain,” says Muller.

Pareto owns an unmatched portfolio of regional and super-regional shopping centres. It is the full owner of Cresta Shopping Centre, Southgate Mall and Value Market, Westgate Regional Shopping Centre, all in Johannesburg, and a 50% stake in Menlyn Park Shopping Centre in the east of Pretoria. It also wholly owns The Pavilion in Durban and Mimosa Mall in Bloemfontein. In Cape Town it co-owns Tyger Valley Shopping Centre as well as a 50% stake in Cavendish Square.

Pareto also holds 25% of Sandton City and its surrounding assets including the Sandton Convention Centre and three hotels: The Sandton Sun, The InterContinental Johannesburg Sandton Towers and Sandton Garden Court.

new shopping centres: are we building too big too soon?

news

With more retail competition than ever before in South Africa and local consumers coming under mounting economic pressure, recently opened shopping centres, and those set to open soon, could experience a slow start to trading, says Marius Muller, CEO of Pareto. Marius Muller, CEO of Pareto

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shopping & retail SA // September 2014 Page 7

news

The 50 000 m2 regional shopping centre with a 10 000 m2 Value Mart is owned and managed by Growthpoint Properties. Its decision to invest in the future of the mall is

also an investment in the future of this region, which has been hard hit by the recent mining strikes.

“Waterfall Mall’s refurbishment will boost our shopping experience with sparkling new tiles in the malls and passages, fresh new bathrooms and a contemporary new design for our bulkheads,” Marlene Bouwer, Centre Manager of Waterfall Mall said.

“It will also help bring a welcome boost to our local economy. Wherever possible we are using local contractors which helps create jobs in our area.” The mall’s thoughtful approach to ensuring its refurbishment results in the best benefit to its community means it has also established a charity platform to donate the fixtures it is replacing, such as wash hand basins, toilets, urinals and about 7 000 m2 of tiles, to charity and community organisations that can use them.

Bouwer added, “We’re thrilled to be undertaking this refurbishment for our shoppers, who will soon be able to enjoy their favourite shopping in a refreshed, modernised setting. We are enhancing our shopping experience and we’re excited for the future of the mall. We have great confidence in the future of Rustenburg and its surrounds, and our investment in Waterfall Mall’s refurbishment shows our commitment to the community.”

Thanks to this refurbishment, Waterfall Mall shoppers will also enjoy a new information kiosk, which will be installed near Cape Town Fish Market. In addition to receiving information about the mall, the new kiosk will also provide visitors with information about local tourism and accommodation within the greater North West region, supporting the travel and tourism industry in the area. To help shoppers easily find the stores and services inside the mall, it will also provide three new digital touchscreens with information and directions.

The refurbishment work is already underway and scheduled to be complete by December this year. Most work is taking place at night, to minimise inconvenience to shoppers and retailers, and the centre’s trading will continue as normal. At the same time as undertaking this exciting refurbishment of its interior, Waterfall Mall is also refreshing its brand and will introduce a new logo and eye-catching artwork.

Introducing welcome advantages to the local economy, Waterfall Mall first opened some 16 years ago in September 1998. Since then, it has gained strong support from its community becoming its shopping destination of choice, with between 550 000 and 650 000 shoppers visiting the mall each month.

Driving the mall’s popularity is its passion to ensure that shoppers in this region can enjoy a world-class shopping experience with all the latest brands, trends and innovations in 135 shops, anchored by Woolworths, Game, Edgars, Pick n Pay and Ster Kinekor. At the same time, it provides unique shopping tailored to local consumers’ needs.

The mall is located at the heart of a region that is strongly connected to its natural resources. As part of this community, Waterfall Mall recently installed solar panels on its roof to take best advantage of Rustenburg’s sunny climate and ensure it minimises its own dependence on the area’s energy resources.

The services of the mall’s original architect, VDO

Consulting Architects, have been retained for the refurbishments and Mont Blanc

Construction have been appointed as the contractors for the project.

The Waterfall Mall is undergoing a R33 million refurbishment which will enhance its shopping experience, ensure it is well positioned for a bright future, add new services in the mall and create welcome opportunities in the local economy.

refurbishment of rustenburg waterfall Mall

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franchise

More and more women are finding a business home in the franchise world and paving the way for other to do the same. As the country

celebrates women’ s month it is encouraging to see how many strong women are now heading successful franchises.

In fact, in the latest research conducted by Franchise Directions, we see a significant shift in the increase of women franchisees, increasing from just under 29% in the 2010 survey to almost 34% of franchisees in 2012. This result is significant as it points to female ownership in various service-based business categories.

Lindy Barbour, Franchise Directions director, says this could in part be due to pressure for additional disposable income requirements.

“Franchising offers a relatively low risk barrier to entry. The benefits of skills transfer and the ongoing support of the franchisor makes it far more attractive than pursuing an independent start up.”

Richard Mukheibir, CEO of Cash Converters, the largest second hand goods franchise in the world, says they have seen a steady increase in the number of women entering the industry with 34% of all their franchisees in South Africa now women. “Aside from the economic

argument, we believe women tend to be really strong executers and collaborators and seem to thrive in a franchising community that breeds openness and mentorship. They also have strong networking and communications skills that are so important when it comes to communicating with the franchisor, vendors, and customers,” he says.

Vera Valais, executive director of the Franchise Association of South Africa (FASA), concurs, saying that women generally are more detail oriented and set very high standards for themselves. “These are key attributes to becoming a successful franchisee and of interest, the top performers in many of the brands are notably women.”

Mukheibir agrees. “Women tend to be great organisers, can prioritise well, and have an eye for detail. Characteristics like these are a perfect match for operating a franchise. They also have the ability to think quickly, improvise, and adapt when necessary and these are definite strengths in our sector,” he says. “Female business owners also tend to be more financially conservative and willing to start small on their way to growing big. This is the kind of business approach and philosophy that is perfect for opening, operating, and growing a franchise.”

The franchise sector has shown significant resilience over the last couple of years and has

not only proved itself as a worthwhile contributor to GDP, but also as a sustained employer. The latest figures available from Franchise Directions peg the number of parties employed at almost 520 000 as of 2012 and it is estimated that the franchise sector has added more than 50 000 jobs to the economy over the last period.

“We believe moving forward that women will play an increasingly dominant role in the sector. It is ideally suited to their unique skills set and a relatively risk-free business opportunity if researched well and backed by a strong franchisor,” concludes Mukheibir.

Some hints and tips from women in franchisees

Maureen Gordon – Cash Converters Hillcrest: Women have had decades of learning to play by the rules and franchising is definitely a game with a mountain of rules. In our experience for a franchise to be successful it is essential to “work the model”.

Always thoroughly research each and every franchise before making a decision to invest in any particular one. You need to ask the hard questions and listen very carefully to the answers. Exactly what will your investment involve in terms of finance, training, time,

rules, guidance and support. Investigate the CEO, check the company ethos, where head office is situated in relation to your location, what type of support is offered, how much autonomy you have.

Never forget that although you are part of a corporate being, it is your bottom line. Don’t assume because they have designed shops before they automatically know what’s best. You have to be hands on all the way through the process, often a woman’s perspective has a far more practical approach.

Lerato Sibanyoni – Cash Converters Greenstone:Always do your research well so you know what you are getting into and remember the franchisor is important as they provide the opportunity and the guidelines to run the business.

To make a success of your venture you need to be committed, love what you do, work hard and follow the guidelines.

Laetitia Steel – Cash Converters Selcourt Towers:Go back and research the business plan and business model and ensure that this suits your personality and character.

Trust and openness with the franchisor is essential as you are almost like business partners.

strong women in franchising - this business is not just for men anymoreThe franchise business model is no longer a man’s game.

Lerato Sibanyoni Laetitia Steel Maureen Gordon and Hayley Kingaby

Page 10 shopping & retail SA // September 2014

Convert it.

WOMEN IN FRANCH IS ING

retail

Flora Centre is located on the corners of Ontdekkers Road and Conrad Street in Florida North, Roodepoort.

The shopping centre enjoys excellent exposure onto Ontdekkers Road,

which is a major thoroughfare, and it is also located approximately 1,2 km from the N1.

The shopping centre is surrounded by both low and high-density residential dwellings as well

as other commercial properties and is very well supported by the local community.

The refurbishment of the property is nearing completion and has been very well received by both tenants and patrons.

The refurbishment entailed a number of cosmetic upgrades, the construction of a new parking deck and the construction of a new drive through facility for Nando’s.

Flora Centre is made up of approximately 20 000 m² retail space and approximately 3 500 m² office space spread over five levels.

The shopping centre is anchored by Pick n Pay and includes tenants such as The South African Post Office, Nedbank, Absa Bank, Truworths, Clicks, Sheet Street, Pep, Capitec Bank, Pick n Pay Liquor, Ackermans, Wimpy and PNA. We have recently secured a Health Club who will be taking up approximately 2 000 m² as well

as an Oriental Market which will be occupying approximately 3 000 m².

The Oriental Market will be made up of 32 smaller retailers offering a range of products. Both of these tenants will be occupying premises on the lower level and both are expected to be trading this year. A number of longstanding tenants have also upgraded their own premises and reopened new shops.

shopping & retail SA // September 2014 Page 11

introducing Flora Centre as a potential site for your brand

Old entrance

New entrance

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The report, entitled “Understanding Africa’s middle class”, found there are 15 million middle-class households in 11 of sub-Saharan Africa’s top economies this year, up

from 4,6 million in 2000 and 2,4 million in 1990 – an increase of 230% over 14 years. However, of the total number of households across these focal economies, 86% of them remain within the broadly “low income” band, emphasising the nascent maturation of many of the continent’s markets.

The report also found that the combined GDPs of the 11 measured economies had grown tenfold since 2000.

The study uses a proven methodology widely employed in South Africa. The report, based on the Living Standards Measure (LSM), gives investors to Africa data on which to base their investment decisions.

In the past, the conventional wisdom was that as many as 300 million Africans are categorised as “middle class”. The report points out that investors using an unquantifiable assumption might find individuals they had thought were middle class were in fact highly vulnerable to lose that status in any economic shock.

The report suggests that while the middle class may be smaller than previously thought, two factors should give investors greater comfort: by any methodology Africa’s middle class is growing strongly; and Africa’s income accumulation is far more broad-based than had previously been thought.

Standard Bank senior political economist, Simon Freemantle, author of the report, says the new report is cause for optimism among investors as it suggests even greater scope for future growth, and indeed the report forecasts acceleration in the accumulation of middle-class households in Africa.

Commenting on the lower than anticipated total number of middle-class households, Freemantle says any view “concerning the undoubted ongoing improvement in Africa’s economic performance has to be tempered with the reality that the level of this growth and the nominal size of the continent’s middle class had not until now been adequately measured”.

He argues the previous figure of 300 million “middle class” Africans was viewed as a best-estimate that has now been confirmed as to trend if not as to the total aggregate. The report cites the African Development Bank’s (AfDB) influential 2011 study, “The Middle of the Pyramid: Dynamics of the Middle Class in Africa”, which by its methodology attached middle-class status to individuals earning just US$4 to US$20 a day, and even a “floating class” of individual earning US$2 to US$4 a day, thereby categorising fully one-third of Africa’s people (over 300 million of them) as “middle class”.

“In fact, such individuals would still be exceptionally vulnerable to various economic shocks, and prone to lose their middle-income status,” explains Freemantle.

South Africa’s LSM measure as a methodology is not income-based but rather uses a wider range of analysis. The report covers 11 selected sub-Saharan African countries which combined account for half of Africa’s total GDP (75% if excluding South Africa) and half of its population. The methodology identified LSM5 and above as middle class and categorises household income into four distinct income bands: low income; lower middle class; middle class and upper middle class.

“Standard Bank has attempted to fill the knowledge gap by using comprehensive household income data and adopting our own measure of the middle class using South Africa’s LSMs as a framework in order to provide cross-quantifiable reference points for peer African economies.” The 11 focus economies are: Angola, Ethiopia, Ghana, Kenya, Mozambique, Nigeria, South Sudan, Sudan, Tanzania, Uganda and Zambia.

This methodology found there was an undeniable swelling of Africa’s middle class irrespective of which methodology was used.

“Looking ahead, an even greater elevation in income growth is anticipated in the next 15 years; between 2014 and 2030, we expect an additional 14 million middle-class households will be added across the 11 focal countries – tripling the current number. Including lower-middle-class households, the overall number swells to over 40 million households by 2030, from around 15 million today,” the report states.

Furthermore, while figures for 1990, 2000 and 2014 all contain more lower-middle class than middle-class households, by 2030 it is expected that “there will be notably more middle-class households than those in the lower-middle-class bracket (19,2 million versus 22 million)”.

Freemantle says: “The swifter pace of middle-class growth is critical in its suggestion of a more marked income ascent in the next decade and a half, compared to the period since 2000.”

As a caution, the report states: “Though there has been a meaningful individual lift in income, it is clear that a substantial majority of individuals in most countries we looked at still live on or below the poverty line (measured as those with a daily income of US$2 or less).”

Income discrepancies are vast among the 11 economies, with almost 86% of the 110 million households in the focal grouping falling within the low-income band. This is expected to fall to around 75% by 2030.

“In conclusion, while the scale of Africa’s middle class ascent has, we believe, been somewhat exaggerated in line with the at times breathless ‘Africa Rising’ narrative, there is still plenty of scope for measured optimism regarding the size of the middle class in several key SSA (sub-Saharan Africa) economies. Reliable and proven data should if anything spur more interest in the continent’s consumer potential by adding depth to what was previously conjecture,” says Freemantle.

Page 12 shopping & retail SA // September 2014

Johannesburg, South Africa, 19 August, 2014 – Africa has experienced substantial growth in its middle class over the past 14 years, according to a study by Standard Bank (http://www.standardbank.com).

africa focus

Simon Freemantle

standard Bank report confirms strong growth in Africa‘s rising middle class – and even faster future growth

Service and productsEngen attributes its long reign at the top to continued investment in meeting customers’ needs. “We remain focused on providing a great forecourt and convenience service experience, and on developing products that are relevant to our customers,” says Joe Mahlo, General Manager, Engen Sales & Marketing.

Engen has delighted customers with a host of innovative convenience partnerships over the years, and pours significant investment into customer service training, with interventions including its annual Phambili Roadshow, Smile customer service programme and iPad-based distance learning programme, Engen Learn.

“We have worked very hard to deliver a unique ‘branded’ customer experience and appealing convenience package,” says Mahlo.

Rising through the ranksTasneem Sulaiman-Bray, Engen’s General Manager: Corporate Affairs, says Engen’s sustained success shows the brand has pride of place in South African motorists’ hearts and minds.

“Not only do we lead the industry in share of market, but our brand continues to be recognised and trusted. We’re honoured by motorists’ continued endorsement of our hard work.”

No accidentEngen is no stranger to accolades having once again won the people’s most popular fuel brand in the 2014 Standard Bank People’s Wheels award amassing 27% of the votes in the “Most Popular Fuel Brand” category. Engen was also the winner of this category in 2013 when it attained 26% of the votes.

Engen was named SA’s leading oil company in the 2013 Top Company Reputation Index run by Mail & Guardian, and this year was once again named the “coolest petroleum brand” for the fourth consecutive year in the Sunday Times Generation Next youth survey.

Mahlo says a Brand Tracker survey for the petroleum industry shows increasing awareness and usage of Engen brand. “It is becoming increasingly important for service station brands to offer great service in times of economic hardship,” he says.

Winning strategyMahlo says Engen is optimistic about building momentum for the brand as recessionary pressures continue.

* Sunday Times Top Brands Awards is commissioned by Avusa Media and conducted by TNS Research Survey

shopping & retail SA // September 2014 Page 13

retail

engen is the number one petrol station brand 4 real!Engen, South Africa’s most popular fuel and retail convenience brand, has again strengthened its brand leadership. The company has won the Sunday Times Top Brands award for a record fourth time running, beating competitors including BP, Shell and Total in the petrol station category. After rising to joint first place with BP in 2010, Engen won the award outright in 2011 for the first time.

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Page 14 shopping & retail SA // September 2014

retail

The Group also officially celebrated its 100th store opening in South Africa, and cemented the region as the fastest growing of all 17 countries in which the

Group operates.

“Johannesburg is our first regional office outside our headquarters in Australia and has now paved the way for the opening of our regional offices in the USA and Singapore,” says Michael Hardwick, Cotton On Group Chief Financial Officer.

“South Africa plays a critical role in the ongoing success of our business, and is a key contributor to the 30% growth we have achieved globally for the past three years. In 2013 the Group opened 27 stores in 27 days in the lead up to Christmas, surpassing R1 billion in sales.”

What started as one store and a workforce of 15 people in South Africa has expanded, within three short years, to seven-and-a-half million customers, 25 million units sold, all driven by a workforce of 1 300 people here in South Africa. With no plans to slow down, the Group intends for its 100 stores to become 300 in the region, and the team of 1 300 people to grow to 3 000 within five years.

“South Africa is rich with talented, innovative, and forward thinking individuals. Our team here play a crucial role in shaping why South Africa is set to become a driving force in cementing our plans for future growth, both within Africa and beyond,” says Johan van Wyk, Cotton On Group South African Country Manager.

“For the Cotton On Group, the successful expansion of our operations is underpinned by the guiding principles: invest in people, ideas, leadership and resources, and do this in countries like South Africa that are led by

people who share the same like-minded principles,” adds van Wyk.

The Cotton On FoundationFocusing on building a progressive future, the Group’s philanthropic arm, the Cotton On Foundation, has funded projects to the value of R250 million in a unique partnership with its customers and employees. The Foundation provides opportunities in education, healthcare, infrastructure and sustainability, all with the aim of ending global poverty. Its mission: to empower youth to lead the way through education and opportunity, by educating 20 000 people in southern Uganda by 2020.

Their recent partnership with the Nelson Mandela Foundation is indicative of its commitment to the South African community, where it will generate funds with the aim of reaching 5 000 children through the sale of Foundation productsin Cotton On stores nationwide.

Investing in people: Cotton On Group Uni Highlighting the value of education, the Cotton On Group has launched its multimillion rand educational platform, Cotton On Group Uni in partnership with Deakin University, an opportunity that has just reached our shores. The programme consists of two key modules; firstly a “pathways to leadership” programme, which has been orchestrated to develop a high performing team of senior leaders within South

Africa. Secondly, a Learning and Development Academy has been established, which consists of 24 module syllabuses, providing graduates with an internationally accredited Diploma of Management.

Launching South African E-CommerceAs a part of its global growth plan and focus on connectivity with customers, the Cotton On Group is launching its first, state-of-the-art South African E-Commerce platform in the imminent months.

“We have appointed some of the best E-Commerce talent to help guide us in reshaping our global platform for effective online customer engagement, on a local level. Market insights play a huge role in defining brand direction; therefore it’s crucial that we

have the ability to connect with our customers in different ways, through different channels,” says van Wyk.

Not only outward focused, the company goes to great lengths to ensure that it has a strong core. It takes great pride in its team, who the Group continuously aims to assist in their personal and professional development, hoping to encourage long-term employees. It nurtures health and wellbeing through a variety of activities, and promotes skills development by encouraging members to attend its university. The Cotton On Group believes that by being an employer of choice, this will extend to drive value through to its customers. With an exciting journey already travelled, the future holds many bright plans for this innovative group.

Cotton on Group earmarks south africa at the epicentre of its african growth plansNow considered one of the fastest growing retail groups in the world, the Cotton On Group officially launched its regional headquarters in South Africa, cementing the Group’s commitment to South Africa as the cornerstone of its operations in the region.

Mobile transacting simplified

by Howard Moodycliffe, head of marketing and international, wiGroup

technology

shopping & retail SA // September 2014 Page 15

The recent slew of mobile payment apps is but one part of this. A number of large retailers now offer mobile transacting solutions that give customers discounts, rewards,

loyalty benefits and additional services such as money transfers, all integrated to the point of sale. This means that customers can now make a range of transaction types at the till point, regardless of whether they use a smartphone or a feature phone.

While these new mobile transacting services add immense value to the customer’s purchasing experience, boosting customer loyalty and increasing foot traffic to stores, there’s an obstacle to their broader success.

The number one reason that mobile transacting campaigns and services fail is because the cashier at the till point doesn’t understand the tech well enough, or has not been properly trained to explain it to the

customer and enable them to make their transaction successfully.

A recent client survey of key South African retailers revealed that there are some basic fundamentals that need to be adhered to for mobile transacting to be truly successful; the number one reason being staff training.

The most successful mobile transacting campaigns in the country today are driven by retailers that make sure that each and every staff member understands how to accept and process mobile transactions at the till and how to show a customer what they need to do. Knowing how to redeem a mobile coupon, or how to accept a mobile payment, is not just a nice-to-have for staff members: it’s a fundamental prerequisite for them to even work there.

It is challenging, particularly considering the sky-high staff turnover rates at most retailers.

From an operational perspective, ensuring all staff are up to speed with new mobile transacting technology at the till point is a potential headache. But the customer’s interaction at the till point will make or break the success of your chosen solution. Get this right, and most of the rest will slot into place. Fail to up skill and educate your staff, and your customer will quickly get fed up.

Some retailers already have the best brand ambassadors, and early adopters they can ever ask for in their till staff. If you’re a retailer serving middle to lower income customers, remember that your staff is your target market. Consumers in the lower LSMs are very comfortable and sophisticated with their use of mobile phones. Don’t make the mistake of assuming they’re not knowledgeable just because they don’t have smartphones. Train your staff properly, invest the time and effort to make sure they understand the tech and how it can work for them.

Customers today are faced with so much choice and so many options, that to make your solution or offering stand out requires consistency of the highest order. The tech has to work first time, every time. Your customers will only ever give you the one chance before they discard your offering and move on to something else.

However, the barrier to entry for most people looking to adopt new technology is not technical - it’s trust. Use your staff as the perfect test audience. When they understand the real value of your mobile transacting solution, they’ll go home and tell their friends and family.

For the new generation of mobile transacting solutions to live up to their potential, retailers need to be ready to explain things to customers very clearly. And your best avenue to do so is still your till staff. Invest in them as you invest in your tech, and you’ll quickly see the positive results.

staff will make or break new techSouth Africa’s near-total mobile phone penetration has unlocked huge opportunities for retailers to reach their customers in new ways and to offer them new services that add value to their lives.

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Page 16 shopping & retail SA // September 2014

“This is one of the key trends we have highlighted and adopted at properties where we provide security services,

and we have a very capable technology business unit which has undertaken numerous extremely high value and sophisticated electronic security installations. While many commercial sites may have CCTV and access control systems, they lack full integration, which is crucial to successful implementation. Going forward, we believe it will be essential for companies that offer multiple security disciplines be able to effectively bridge the gap between technology and manned security. Many commercial property owners are not yet taking full advantage of the technology currently available, despite the fact that this is becoming more affordable and is cost-effective in the long run.

“With recent global events having made us very aware of the importance of security in shopping centres and other highly patronised commercial spaces, we see the trend moving from a relatively inconspicuous to a far more visible security presence. A major challenge in the security sector is to try to identify the criminal element among legitimate visitors and control access – while still ensuring free flow of both pedestrian and vehicular traffic. And,

although shopping centres are private property, visitors need to be treated as if they are on public property, especially when the centre offers public facilities, such as post offices, for example,” says Phipps.

Enforce Security Services currently has approximately 630 000 m2 of retail property space under its protection nationally, including Gateway Theatre of Shopping and Durban’s Point Waterfront. Leading hospitality facilities where security is provided by Enforce include the Cape Grace Hotel and Holiday Inn Waterfront in Cape Town, Beverly Hills in uMhlanga in KwaZulu-Natal, Southern Sun’s Hotels Durban and Gallagher Estate in Midrand, Gauteng, which is one of Africa’s largest conference and exhibition venues. Enforce is also responsible for security in strategic sites such as Koeberg Power Station and Dube Tradeport, with all their security guards National Key Point-registered.

Phipps says with global trends undoubtedly driving towards achieving a reduction in operating costs – including security, this should not in any way be to the detriment of capability and efficiency. “In fact, the objective is to provide the same or better service for less. This is achieved by the genuine integration of technology with fewer, but in some cases slightly more qualified and more competent

personnel, and needs to be coupled with multi-skilling. As a result there is a shift towards offering not just a single service but a range of integrated soft services under one roof, such as parking, cleaning and facilities management, thereby achieving cost efficiencies.”

He says off-site monitoring is one of the ways in which increased efficiency is achieved via the use of technology. “Off-site monitoring enables landlords to shut down a specific area or zone within a centre that is not used after a certain period of the day, and then manage access control to that area by exception. This allows for a reduction of manned security in that area and a more effective deployment of resources. It can also be used to monitor and control areas that have very low traffic flow, but which still need a degree of access control. Video and voice integration allows an operator to interact with a visitor and then grant or deny access or egress – again translating into greater efficiencies and lower costs.”

He comments that here in South Africa and from a technological standpoint, while we have access to the same high international security standards, there is still under-utilisation of technology in the local industry. “Just as necessity is the mother of invention, crime trends drive innovation in security. South Africa has a very well established electronic security

industry and in many cases, such as intruder detection and armed response, where demand has dictated development, can be regarded as being a global leader. We utilise CCTV systems, biometric access control, voice evacuation systems and remote video verification. In some instances development of systems was delayed due to poor infrastructure, for example, an historic lack of a stable broadband network inhibited the development of remote video surveillance.

“While difficult to accurately estimate, security has both tangible and intangible value and is increasingly important. It is also about perception, as today’s tenants are undoubtedly placing a higher priority on security than previously. It makes sense that it is far better to have security and peace of mind for landlords and tenants, with preventative measures in place, than to wait for an incident to occur or reoccur. Unfortunately, security is an area where some property owners first start to cut costs. However, there is a broader cost attached to this. As soon as there is an incident or a loss has been incurred at the premises, one’s perspective changes.

In addition, legislators are starting to understand the link between Health and Safety and security and are starting to link them together. It is no use having health and safety

security

Future success of commercial property security lies in technology integration, says enforce Security ServicesGlobally, the future of commercial property security lies in a greater integration with technology, says Clinton Phipps, CEO of Enforce Security Services, a member of Excellerate Property Services group.

security

shopping & retail SA // September 2014 Page 17

compliance in regard to a property and not paying due attention to security risks, or utilising a non-compliant operator which will impact the site’s health and safety position. It is also worth noting that there is ultimately an additional cost to utilising a non-compliant security services provider versus a compliant operator,” says Phipps.

Security also has a huge role to play in regard to the management and marketability of commercial property. More and more employers today are looking to provide a secure and pleasing environment for their staff, so that employees can focus their full attention on their core function and be productive, instead of being concerned about their safety – for example, when working late and then leaving the office, or in regard to the security

of their vehicles (secure parking). Phipps makes the point that making people feel safe is also a state of mind. He also says while there are no minimum requirements for security in terms of law, most often there are minimum requirements in terms of the insurance of a property.

“Astute property owners perceive security as a means of adding value to a property. Our advice to owners of high traffic properties such as shopping centres, particularly those with a tourism element, is that planning is essential. They need to understand season and event-driven trends and adjust accordingly.

Forewarned is certainly, as they say, forearmed. Shopping centres and tourist destinations require an intelligence gathering capability as in many cases criminal threats (such as armed

robberies) are almost impossible to prevent without prior knowledge.

“Enforce has one of the largest special events divisions in the country which has provided security for most major sporting and musical events in South Africa, and also has a well established investigations division with an extensive informer network. Incident management is also crucial as reputational damage caused by poor incident management can have a greater impact than the crime itself. It is critical that evacuation and incident management plans are in place and that all personnel are trained to respond appropriately.”

Phipps adds that if the reality is that costs need to be reduced, there is a way to achieve certain objectives without compromising oneself or

unduly exposing the property to security risks. One needs to find a solution-driven, quality compliant, professional operator to work with in order to source a higher value proposition and achieve the required objectives.

All security companies in South Africa are required to be registered with the Private Security Industry Regulatory Authority (PSIRA) in order to provide security services.

There are also various voluntary industry bodies that work on improving the standards of the industry.

Enforce Security Services is a Gold Class member of the Security Association of South Africa (SASA) and is actively involved in driving compliance within the industry.

Middleburg Mall’s annual “My Middelburg, My Region Art” competition has once again showcased some of Mpumalanga’s brightest and

best artists with more than 50 entries received for this year’s competition which ran during the month of June.

Giving youngsters an opportunity to shine, two children-focused categories were added with a new 0 to 12 age group and a 13 to 18 age group. The youngsters and the adult artists contributed to some beautiful work, which created a vibrant public exhibit in the Woolworths Court at Middelburg Mall.

Fantastic prizes were up for grabs and the winners were elated to be invited to the prize giving on 8 August 2014.

“Middelburg Mall has presented this competition for three consecutive years, and we’re overjoyed with the high quality this year’s entrants have delivered. We are truly privileged to be surrounded by so many talented artists, though it did making judging an almost impossible task,” says Middelburg Mall General Manager, Mike Tammadge.

In the 0 to 12 age group, 12-year-old-Hanro Fraser snapped up first prize for his painting titled “The Boat”, followed by Minette Herbst (six) and Mathine Bester (six) in second and third place. Named “Young up and coming Artist” was four-year-old Eduard Nunes.

The drawing category was won by Samantha van der Vyver, also 12 years old, taking first place for her topical work of art “Save the Rhino”. Following in second place was Izabella Usher (four).

Suretha Prinsloo (18) clinched first place in the 13 to 18 age group with her painting, “Dungeon Entry” with Jeanelle van der Westhuizen (17) taking second place.

Jeanelle again shone in the drawing competition, this time taking first place with her drawing “Peaceful tiger”. Taking second place was Tania do Poco (16) with Thulani Nkambule (17) coming in third.

In the adult competition, Coster Mkoki once again scooped first prize for his sculpture, “A Friend in Need – Rhino”. This is the third year this remarkable artist has entered the competition.

Philmon Talane claimed the winning prize in the painting category with his artwork “Steve Tshwete offices”, followed by Madelene Schoeman in second place. Estelle Usher and Hanlie Coetzee took third and four place respectively.

Baloyi Dick T won the drawing category with “Buildings” and Bronwyn Katzke again snapped up the photography category with her entry titled “Hands holding charcoal”.

The “anything goes” category winner is Lettie van der Schyff for her remarkable piece titled “Witkerk on tile”.

“It has been wonderful to see the local talent and share in the beauty around us,” says Tammadge. “Middelburg Mall has enjoyed celebrating our region’s splendour and the amazing talent on our doorstep with our community; we can’t wait to do it all again next year.”

This year’s Middelburg Mall annual “My Middelburg, My Region Art” competition winners. Back from left: Philmon Talane (1st place – painting adults); Coster Mkoki (1st place – sculpture adults); Hanlie Coetzee (4th place – painting adults); Madelene Schoeman (2nd place – painting adults); Estelle Usher (3rd place – painting adults); Izabella Usher (2nd place – drawing 0 – 12 years); Lettie van der Schyff (1st place – Anything Goes–adults); Anneliza Erwee (Middleburg Mall marketing manager). Front from left: Tania do Poco (2nd place – drawing 13 – 18 years); Samantha van der Vyver (1st place – drawing 0 – 12 years); Eduard Nunes (Young and Upcoming artist); Jeanelle van der Westhuizen (1st place drawing/2nd place painting 13 – 18 years); Hanro Fraser (1st place – painting 0 – 12 years); Minette Herbst (2nd place – painting 0 – 12 years) and Mathiné Bester (3rd place – painting 0 – 12 years)

Local artists impress with outstanding creativity at Middelburg Mall’s annual art competition

out and about

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