One of South Africa’s best kept secrets is the big and small five game reserve of Mapungubwe which, 1,000 years ago, was the home to a sophisticated African kingdom which traded with Arabia, China and India and where the ancient golden rhino was uncovered. On an early morning game drive, we had the extraordinary experience of seeing a bushbuck giving birth and witnessed a bask of crocodiles at a waterhole, seemingly oblivious to the ready-made meals all around them. The drive ended at a picnic site complete with a gas ‘skottel’ on which we cooked breakfast at the confluence of the Shashe and Limpopo rivers with magnificent views of neighbouring countries Botswana and Zimbabwe. This is a good choice of a vacation destination, and South Africa has an abundance of such treasures. Once South Africans get back into a holiday mood after this global pandemic, there is likely to be a demand for ‘physical distancing’ destinations and tour packages. According to the WOW report on Travel and Tourism outbound tourism accounted for R61bn in 2018, of which 71.1% was spent on personal travel and 28.9% on business and professional travel. With the possibility of physical distance restrictions on seat configurations on flights with the inevitable spike in ticket prices and the sliding rand exchange rate, the challenge to the tourism industry is to channel a chunk of that money into the local market. While the growth of online travel agents and aggregators such Skyscanner and Booking.com has disrupted the travel value chain by offering consumers direct booking capability, there is likely to be resurgence of the use of travel agents offering specialised physical distancing packages. After all, there is no better holiday advice than from an agent who has visited the destination they are recommending. SA Tourism has invited the financial services sector to create financial products such as travel “stokvels” that will enable South Africans to save for travel and to make available travel packages more affordable for lower to middle income earners. According to the WOW report on the Car Rental Industry, established companies such as Avis, Hertz, Bidvest, Europcar, First Car Rental and Thrifty all have established networks in Southern Africa which allows renters to cross into neighbouring countries and leave the vehicle there and fly home. Another holiday destination which is good for distancing is the 700 caravan parks and campsites in South Africa, and according to the WOW report on the Accommodation Industry (currently being updated) their revenue grew 7.7% in 2017/18 compared with a 1% decline in hotel revenue for the same period. Many of these destinations are well managed and maintained, safe and provide excellent facilities, but many have allowed quality to slide. Owners need to quickly implement upgrades to meet the potential market demand. International travel and tourism numbers are expected to fall substantially in the first half of 2020 due to coronavirus and the subsequent travel restrictions imposed by most countries. This will negatively affect the car rental industry, which should consider expanding its fleets of camper vans and off-road camping-equipped vehicles. South African holiday makers should shift their holidays destinations from skiing in Italy to limited human contact destinations such as the Drakensberg,
Gareth Anderson, a 24-year-old school friend of one of my sons, studied brand building and management at Vega and started a business in 2018. He describes his frozen fish home delivery business, called Caught Online, as an e-tailing fishmonger. Since lockdown his daily order book matches his previous monthly totals and Gareth is confident the business will continue to grow after lockdown as shopping habits change. This trend is confirmed by the food retail and wholesale which showed that Pick n Pay’s online shopping service served over two million customers in 2019, a growth of 24% on the previous year, and Woolworths achieved online sales growth of 22.3%. Home deliveries have since soared further as South Africa went into lockdown. This trend may eventually deepen many of the structural challenges facing the industry. Caught Online currently employs seven people in Cape Town and has plans to expand to Johannesburg and Durban. My son completed his business science degree at UCT and his CFA1 last year, but his efforts to find employment in the asset management industry ground to a halt, and he has been employed as Gareth’s despatch manager, taking the head count to eight. The cargo handling report states that only companies in the logistics supply line that are essential to the production and transportation of food, basic goods and medical supplies will remain open, but a possible spike in the sector will come after lockdown as retailers replenish stocks. The tourism and leisure sectors have been among the worst hit by the lockdown and the health and beauty spa report states that as the industry comes into direct close contact with the public, it is experiencing significant losses which may persist after the virus is contained as customers may continue to exercise social distancing. In a similar boat is the events management sector. Amanda Kotze-Nhlapo, chief convention bureau officer of the South African National Conventions Bureau, said South Africa hosts approximately 211,000 regional, national and international meetings, conferences and exhibitions annually and that this number is reasonably stable year-on-year. Until now. The paper and packing sector is less affected as its products are used to package essential goods and a number of its own products are essential and have been hoarded, such as toilet paper. This sector can look forward to the long term trend created by the anti-plastic lobby, which is rapidly gaining momentum, with rising demand for paper bags, paper beverage cartons, straws and paper-based packaging. The national gambling report last published in December 2019 has been re-published this month with an update of the effect of the covid19 virus on the industry. We are about to introduce a free upgrade to WOWEB, with a Woweb4me dashboard to enable users to create a customised dashboard to have selected data ‘pushed’ at them. I will provide detail on that with my next communication.
These are trying times, but hopefully, once the pandemic has exhausted itself, we will be living in a wiser world. The lockdown presents an opportunity to research new business and new markets to pursue when it lifts. To assist South African businesses in these difficult times, Who Owns Whom is offering a 50% discount on all industry reports purchased during this period. While it is a moving target, recently published industry reports cover the potential impact of the coronavirus on that industry and this will be the case for all newly published reports for the rest of the year. We have already prioritised those reports in our production line where industries may be most vulnerable to measures being taken to flatten the contagion curve. These include: Cargo Handling, Storage and Warehousing in South Africa Freight Forwarders in South Africa Manufacture of Electric Lamps and Lighting Equipment in South Africa Operation of Toll Roads Renting of Construction Equipment with or without Operator in South Africa Real Estate Activities in South Africa Retail trade in Second-hand Goods in Stores The Car Rental Industry Travel & Tourism: Travel Agencies, Tour Operators and Related Services The Textile Industry Stay safe The Who Owns Whom Team
Who Owns Whom (WOW) was established in 1980 when my late father, Robin McGregor, published the first book. While it will continue to be published in a digital format, the 40th edition, to be published next month, will be the last printed one. WOW has re-invented itself a number of times, and while ownership research remains a cornerstone, in the last 15 years we have built a substantial file on industries and companies in those industries with a primary focus on unlisted companies. In 2012 we did our first report outside South Africa – Telecoms in Kenya – and we now cover 70 industries in 46 countries on the continent outside of South Africa and have researched profiles on more than 4,000 companies operating in these countries. The Report Generator feature was introduced in 2016 and our latest offering via WOWEB is access to the Companies and Intellectual Property Commission (CIPC) file of all South African registered companies. We are currently in final testing phase of a Dashboard which will run on WOWEB and allow users to customise research to be ‘pushed’ at them. Later in the year we will release Disclosure, a visualisation of linkages between people, companies and shareholders which is designed primarily as a risk and business development tool. The South African Construction Industry was the most viewed report in 2019 moving up from 4th place in 2018. Christo Wiese, the most viewed director in 2018, was only the fourth viewed last year. ABSA was the most viewed company last year after not featuring in the top 10 in 2018 and EOH moved from first in 2018 to second place last year.