Johannesburg – an untapped retail hub
Johannesburg – the facts
Johannesburg is the largest and fastest-growing city in South Africa, with its 500 plus suburbs stretching as far as 1,100 sq km and an average growth rate of 2.1% per year. Its population is 2.42mn making it the 126th most populous city in the world. It holds about 5% of South Africa’s total population. Johannesburg is also the legislative capital of Gauteng Province.
Johannesburg – the economy
The city is one of the key contributors to the Gauteng and South African economies. Its economic growth rate is higher than provincial and national levels, but growth predictions have dropped in recent years due to high youth unemployment. The “ease of doing business” in Johannesburg has been measured as 39th in the world and 2nd in Africa by the World Bank. The city is referred to as the “economic powerhouse” of Africa and has more than one CBD, with Sandton, Rosebank and Roodepoort centres for commerce in addition to the central district.
Mining in the city of gold
Nicknamed eGoli (city of gold), Johannesburg is South Africa’s major commercial, financial and industrial centre. It houses the South African stock exchange, leading banks, mining companies, the Chamber of Mines, and the government regulatory agency in charge of mining.
The Chamber of Mines is an employers’ organisation to serve those who work in the industry by promoting their interests. Formed in the 1800s, the organisation wants to “reposition the South African mining sector as South-Africa’s foremost industrial sector”. The Chamber is a member association of the International Council on Mining and Metals and has teams dealing with economics, employment relations, safety and sustainability, health, education, legal issues, environmental issues and public affairs. The Chamber represents companies producing around 90% in value of South Africa’s mineral production.
The mining sector contributed $1.33bn to the South African economy in 2014 and employs roughly 495,568 people.
Retail – an untapped hub?
Johannesburg is also home to 10-12,000 street traders whose operations in the CBD bring in about 50mn rand in combined annual revenue.
It is a major retail centre in southern Africa with people travelling from all over the region to shop there. The city is home to no less than 20 large shopping malls including the Carlton Centre, the Small Street Mall and the Hyde Park Mall. Added to that, street vendors, galleries, theatres and flea markets make it a popular destination for purchasing crafts, from jewellery and wood carvings to fertility dolls.
Recently Dr Tanya Zack spoke to fin24.com about the potential for the city to grow even farther in the retail sector. According to Dr. Zack, the city is a hive for “low-end globalised trade” in cheap clothing, shoes and the like. A survey found that around $793mn was spent every year in Johannesburg’s CBD by cross-border shoppers, around the 53 city blocks with more than 300 shops which make up the central district. Around 70% of total shoppers were cross-border, and spent an average of $1061 on a trip including about $258 on services like transport.
According to Zack, this shows “untapped potential” for the city as the increased demand for services and products as well as infrastructure will lead to investment and create jobs.
Standard Bank Group is the largest African banking group buy assets. As of year-ending 2016, it holds total assets of $143bn and employs 54,000 people. It has been around for over 150 years and was listed on the JSE in 1970. The bank operates in 20 countries across Africa and works across three areas: personal and business banking, corporate and investment banking, and liberty – its insurance segment.
Sasol is an international integrated chemicals and energy company which works across 33 countries employing 30,300 people. The company has a 63-year history and was listed on the JSE in 1979. Its main units include mining, exploration and production. It operates six coal mines and offers fuel for domestic and industrial use, lubricant, greases and automotive fuels.
MTN is a mobile operator which offers services to consumers and businesses. It became incorporated in 1994 and employs over 25,000 people. It also offers digital services like e-payment and apps, including MTN Football, MTN Music and MTN Play. The company has a revenue currently of $9.8bn.
5 minutes with... Janthana Kaenprakhamroy, CEO, Tapoly
Founder and CEO of award-winning insurtech firm Tapoly, Janthana Kaenprakhamroy heads up Europe’s first on-demand insurance platform for the gig economy, winning industry awards, innovating in the digital insurance space, and leading with inclusivity.
Here, Business Chief talks to Janthana about her leadership style and skills.
What do you do, in a nutshell?
I’m founder and CEO of Tapoly, a digital MGA providing a full stack of commercial lines insurance specifically for SMEs and freelancers, as well as a SaaS solution to connect insurers with their distribution partners. We build bespoke, end-to-end platforms encompassing the whole customer journey, but can also integrate our APIs within existing systems. We were proud to win Insurance Provider of the Year at the British Small Business Awards 2018 and receive silver in the Insurtech category at the Efma & Accenture Innovation in Insurance Awards 2019.
How would you describe your leadership style?
I try to be as inclusive a leader as possible. I’m committed to creating space for everyone to shine. Many of the roles at Tapoly are performed by women and I speak at industry events to encourage more people to get involved in insurance/insurtech. Similarly, I always try to maintain a growth mindset. I think it’s important to retain values to support learning and development, like reliability, working hard and punctuality.
What’s the best leadership advice you’ve received?
Build your network and seek advice. As a leader, you need smart people around you to help you grow your business. It’s not about personally being the best, but being able to find resources and get help where needed.
How do you see leadership changing in a COVID world?
I think the pandemic has proven the importance of inclusive leadership so that everyone feels supported and valued. It’s also shown the importance of being flexible as a leader. We’ve had to remain adaptable to continue delivering high levels of customer service. This flexibility has also been important when supporting employees as everyone has had individual pressures to deal with during this time. Leaders should continue to embed this flexibility within their organisations moving forward.
They say ‘from every crisis comes opportunity’, what opportunities do you see?
The past year has been challenging, but it has also proven the importance of digital transformation in insurance. When working from home was required, it was much harder for insurers to adjust who had not embedded technology within their operating processes because they did not have data stored in the cloud and it caused communication delays with concerned customers at a time when this communication should have been a priority, which ultimately impacts the level of customer satisfaction. This demonstrates the importance of what we are trying to achieve at Tapoly in driving digitalisation in insurance and making communication between insurers and distribution partners seamless.
What advice would you give to your younger self just starting out in the industry?
Start sooner, don’t be afraid to take (calculated) risks and make sure you raise enough money to get you through the initial seed stage.