Unions meet their match

2011-02-02 09:53

Walmart’s entry into the South African retail landscape was always expected to elicit a degree of opposition from unions.

Walmart’s historical belligerence towards unions, coupled with its arrogance, real or perceived, were sure to provide ample fodder for its local critics once news of its discussions to acquire Massmart broke.

With the Competition Commission in the final lap of its investigations, analysts are unanimous in their prediction the authorities will give the nod to the deal.

Having accepted this reality, the SA SMME Forum has moved swiftly to safeguard and advance the interests of small businesses, especially those that may be directly affected by the transaction with Massmart, providing certain assurances in this regard.

The forum has identified various opportunities presented by the transaction for small businesses and has engaged Massmart with a view to playing a meaningful role in areas of enterprise development and preferential procurement.

If Cosatu is to make good on its threat to unleash “a mother of all consumer boycotts against Massmart’s products”, then we are in for a torrid time ahead.

But the fact is that Massmart does not manufacture any products. What the company does is provide retail real estate for manufacturers and suppliers of finished goods.

Judging by the lack of interest over recent calls for consumer boycotts or public action in South Africa, it is unlikely that
Cosatu’s threats will materialise.

Common sense dictates that while public benefit organisations should always be vigilant against any possible erosion of gains made since the dawn of democracy in South Africa, we are fortunate that we have a plethora of instruments – such as the effective competition authorities, entrenched labour laws and BEE prescripts (especially on ­enterprise development), preferential ­procurement and skills development – that can be deployed to advance a myriad causes.

In a recent landmark ruling, the Competition Tribunal prescribed as part of its merger approval that Momentum and Metropolitan insurance companies be precluded from retrenching certain categories of employees, mainly blue-collar workers.

Given such a precedent, surely it should be a relatively effortless concession to ­extract from the transacting parties?

Small businesses can also sit back and ­lament the entry of a big player on the local scene with the possible competition they would now face from incumbent Walmart’s global small businesses suppliers and ­wallow their way into extinction or seize the opportunity presented by the transaction.

For the forum, the choice was clear as we have moved to safeguard the interests of ­incumbent small suppliers to Massmart and encouraged Massmart to improve its performance in areas of mutual interest.

The forum is alive to the fact that South Africa cannot on the one hand trumpet for foreign direct investment while we, on the other hand, engage in unrealistic public posturing.

It has identified possible areas of opportunistic practices by existing large multinational suppliers to both Massmart and Walmart.

Large players have, without exception, committed themselves to contributing towards BEE and, most importantly, sustainable small enterprise development. But the proof of the pudding is in the eating.

» Khaas is president of the SA SMME Forum

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