As I sat pondering what I would share this week in Dataweek, I wondered if I should share my frustrations with regards to the yet again pointless, demotivating and destructive Numsa strike in July, or share the negative impact it had on so many South African companies and the resultant short time and further job losses.
I considered elaborating on the impact that the mining strike has had on our small electronics industry and how it has damaged so many of our mining supply customers and therefore affected most of the country’s small to medium contract manufacturers (CM).
Should I again highlight the complete and total illogical implementation of the BEE codes in our industry? This is especially topical considering that the new codes are introduced next year, making it virtually impossible for a white entrepreneurial owner to continue operating his business . . . no, actually this was an easy subject to avoid as I believe it will now carry a five-year jail sentence for opposing or even speaking out against the new BEE codes.
I was wondering if I should join the voices of my fellow manufactures at UEC, Anyview and Vektronix and speak out against the ‘genius’ in our government who came up with the clever idea of assisting and subsidising a billion dollar mega-company like Samsung to enter the South African market in a low-tax economic zone – in direct opposition to local manufacturers.
Not only has this caused instant job losses and lower work demand in these factories but has also jeopardised hundreds of jobs in the future. Rumour has it that the new Samsung factory is a real state-of-the-art facility including a host of robots to move products around the factory at very low cost . . . yes wait for it . . . so they don’t have to employ so many people!
But as the old cliché goes, you only see the tip of the iceberg, and I was wondering if anyone thought about the second tier TV brands who are manufacturing and assembling TVs and related products in SA and who are following all the rules and regulations by importing complete knockdown kits and loyally supporting companies like Microtronix, CZ and a few other CMs to do their assembly and PCB manufacturing.
I came to the conclusion that, no, nobody thought about this at all! So all I can conclude is that the plan seems to be to give a global giant (who already has good market share and a billion dollar bank account) an advantage over small to medium CMs operating in the local market, then offer them an additional tax incentive to allow them to whack the other brands even harder, thereby damaging the even smaller CMs like ourselves. Please can I meet this clever person one day and make sure I have got this right?
So when choosing a topic to discuss this week, I have decided to avoid all these negative factors that we face every day and share the wonderful experience I had on my last trip to China. I was indeed most privileged and honoured to be allowed into two world class Chinese manufacturing facilities.
I should rephrase this and say I was allowed to enter two Chinese war machines. And folks, let me tell you, these guys mean business! I watched in awe as complete products fell of production lines at a rate of 11 seconds per product and products were spewed out across thousands and thousands of square metres of factory space.
I felt privileged to witness the ingenious little tricks and techniques used by the Chinese to get things going faster and more efficiently. I was amazed at the discipline and work ethic displayed by the workers and grew dizzy watching the pace at which the Chinese workers were able to execute the tasks before them.
My brain was filled with so many good ideas as I stood there I could see production lines, people, employment, The most amazing Proudly South African factory looming up on the Johannesburg skyline. But on my flight home I realised yet again that I belong to the dying breed of grumpy white fifty-year-olds boldly holding the manufacturing fort in SA, and that I am fighting against the odds.
I realised that it is in fact me who is wrong and the government holds the master plan for our country, so I came back home and decided to embrace the new BEE codes and enter into a deal with great black partners. We will, like our government, now embrace the Chinese way and bring in Chinese workers to South Africa and prove to the South African youth that it is possible to toil daily in a factory on minimum wage and produce TVs and decoders at rates previously unheard of.
We will make use of the IDC and DTI funds now available to our company and, together with my new partners and the Chinese, we will be able to provide luxury goods for the market so cheap that even the unemployed sitting at home will be able to afford them. When selecting the Chinese workers destined to come and work in our factory in the next few months I asked the Chinese supervisor how he would negotiate with ‘Ivan Jim’. “IWIN-whhoo,” he asked.
I therefore conclude on a positive note that our government has in fact been correct all along: the Chinese and Koreans do hold the key to a richer (or poorer) South Africa.
Watch this space …