10 August 2001

The Black Revolution

Black African people have become the most important economical force in South Africa over the past seven years. This is the most common statement you'll probably hear from business these days. Surprise!

According to a book published in 1991 by John Kane-Berman, this was already the case then:

• Wooltru food and clothing chain claimed that black shoppers are already more important than whites

• Edgars clothing and footwear chain reported an increase by 60% in black expenditure

• Four out of five beer drinkers are black

• Blacks in Gauteng (then the Witwatersrand area) buy more liquor than whites in the whole country

• In 1974 three quarters of all registered vehicles were white owned. It was estimated then that by 1994, only half will be white owned.

• Gough Cooper, a home building company claimed that 65% of their annual turnover was derived from black middle-class income housing in 1988.

• 60% of music sales can be contributed to the black market.

• One in every six bank cards is held by a black South African.

• Black radio services claimed the fastest growing advertising medium at the SABC with advertising expenditure going up 19% compared to 8% for white radio services.

• The Sowetan, a white-owned though black-read daily newspaper,is the biggest morning daily according to average daily sales.

• The 5-Star Carlton Hotel (now closed) reported 50% of weekend packages were sold to black customers.

• Old Mutual Properties reported that every second office leased during the first four months of 1998 in the Johannesburg CBD, was negotiated with a black professional practise or business.

• Insurance gaint Sanlam claimed that it's black business rose 262% over four years up to September 1989. 30% of it's life policy owners were black.

• 56% of money spent on household goods in the Orange Free State goldfields was derived from black consumers.

• In 1987 black holidaymakers to Durban grew by 20% with more choosing 3 to 5 Star accomodation compared to 1 or 2 Star. They also had more money to spend than white holidaymakers.

What does this really tell us? Regular readers will probably know by now that white expenditure and disposable income has been dropping steadily over the past couple of years. In comparison, black disposable income has increased quite dramatically.

There are a number of factors that contribute to this situation. Since independence and the obvious change of government (don't forget the abolishment of apartheid), it has become more difficult to survive (financially) for most middle-class South Africans. Rates and Taxes on property has gone up, so did services such as electricity and water, personal taxes and V.A.T. on goods and consumables (looking at the so-called sin-tax on cigarettes and alcohol specifically) have gone up. New taxes were introduced such as "luxury" taxes (for owning more than one property, etc.), tax on certain monetary funds (pension fund limits, overseas investments, etc.) and of course the basic fuel and transport taxes. Never mind the ones I don't even know about (probably because I'm not directly influenced by it).

In return, service levels are mostly non-existing. Crime is still the main reason for most South Africans (black and white) leaving the country. Prices have gone through the roof looking at the basic food stuff. Transportation including fuel prices have become the primary reason for exorbitant increases on goods in general.

Free water has become the norm to certain areas (though limited to 6000kL), clinics provide free services for certain ailments and/or conditions, houses are being built for the homeless and money is being poured into numerous "self-help" community projects. With this comes the obvious corruption and the ever present gravy train.

Now, gimme free water, drop the rates and taxes on my hard-worked-for-property (which after seven years still belongs to the bank), write off my debts and gimme money to start my own community project. Sponsor my fuel and drop my taxes. I will have such a disposable income that I'll probably be able to boost the local economy second to none!

Put that in your pipe and smoke it!