Local licence holder for Starbucks in South Africa, Taste Holdings, has halted any plans to open more outlets of the US coffee chain as it struggles to make ends meet.
 
Taste, which also owns the jeweller Arthur Kaplan and Domino's Pizza, suffered operating losses of R87 million in the six months to end-August, with sales down 3%.
 
The group said that while the store network of twelve Starbucks outlets is profitable at a sales level, it's not producing the required return on its investment.
 
Setting up a new Starbucks store in South Africa costs between R5 million to R8 million, the group previously said. This is very expensive, says Simon Brown, founder and director of investment website JustOneLap.com. Brown estimates that the actual cost could now be higher than previously stated - perhaps even reaching R20 million. 
 
Hitesh Patel, director of new business at Starbucks competitor Vida e Caffè, says the average cost of setting up one of its stores is only around R1.5 million.
 
That is is less than a third of the minimum cost of a new Starbucks outlet.
 
Taste has a 25-year licence deal to operate Starbucks stores in SA - and have to pay royalties to the US brand, which are proving to be costly, says Michael Treherne, retail analyst at the fund manager Vestact. 
 
Due to the royalties and expensive store set-up costs, Treherne says Starbucks South Africa has had to resort to premium pricing - which is not at all good during a recession. 
 
The difference between food prices is more pronounced. We could find a muffin at a Vida e Caffe outlet in Johannesburg for under R20, while the cheapest muffin at a Starbucks was R32.
 
 
Source: News24
The drinks brand has lampooned itself in their latest advert after a rebranding blunnder. 
Coca-Cola brand Schweppes changed its branding a few months ago. It didn't go down well with customers.
 
Many people were confused by the similarity between Schweppes Soda Water and Tonic Water.
As an apology for the mess-up, Schweppes lampooned itself in an advert.
 
Drinks brand Schweppes lampooned itself in a Twitter advert this week after customers took to social media to complain about it rebranding – and the company promised to roll back a hated change to its branding.
 
 #OhSchweppes, we're so sorry that our mix-up ruined your mixing. For the record, we agree with you - our packaging blunder wasn't our brightest moment. We'll be better.
 
The Coca-Cola brand had changed the look of its Soda Water drink – which had left many to confuse it with Schweppes Tonic Water.
 
Schweppes now admits that was "not our brightest moment".
 
Schweppes senior brand manager, Mukundi Munzhelele, taking ownership for coming up with the rebranding idea. 
 
The senior brand manager, Mukundi Munzhelele, who came up with the bright idea, to marketing manager Nerisha Maharajh who signed off on it, various staffers took it on the chin and lampooned themselves for the mistake in the social media ad.
 
Marketing manager, Nerisha Maharajh after realising she was the Einstein who signed off on this "bright idea". 
 
"The complaints we received were passionate and heartfelt," Munzhelele tells News men in South Africa.
 
"It was only fair to them (customers) that the actual people who worked on the campaign not only see the responses, but respond in a manner that was fitting."
 
Roger Gauntlett, general manager of Coca-Cola Southern Africa is not laughing at the tricked people. 
 
According to Munzhelele, the team wanted to modernise the labels. But a change in colour caused a lot of confusion.
 
Schweppes changed the colour of its soda water branding on its bottles to grey, which made it look like its tonic water labels. It has now changed the labels - tonic water is yellow, and soda water has a stripe of grey.
 
"We took some time to look at our packaging with the feedback received from consumers and decided not to simply revert to the previous design," says Munzhelele.
 
The response sat well with many consumers who applauded the brand for taking responsibility.
 
 
Source: Business Insider
 
JOHANNESBURG - The rand rose for a fourth straight session on Friday to end the week nearly 3% firmer, benefiting from political chaos in Britain and a revival of risk appetite linked to a thawing of United States (US)-Sino trade tensions.
 
Stocks ended slightly lower, with British American Tobacco taking the most off the benchmark index after the United States announced sweeping restrictions on flavoured tobacco products.
 
At 1530 GMT, the rand was 1.09% firmer at 14.0300.
 
Most of the gains were posted after the dollar wobbled as two Federal Reserve officials cautioned in separate television interviews about slowing global economic growth, raising doubts about the number of future US rate increases.
 
The rally followed Thursday’s strong gains, particularly against the pound, as Prime Minister Theresa May battled to salvage a draft Brexit deal.
 
Growing bets that the South African Reserve Bank (Sarb) may raise rates at its policy meeting on Thursday supported the already attractive carry yield offered by the rand.
 
It outpaced most other emerging currencies against the dollar on the day.
 
In a Reuters poll taken this week, 16 of 26 economists said the SARB would keep its repo rate at 6.50% while the rest forecast a 25 basis-point hike.
 
Bonds also rose, with the yield on the benchmark 2026 paper down 4.5 basis points at 9.115%.
 
On the bourse, the benchmark Top-40 index was down 0.17% at 45,851 and the broader All-share index lost 0.1% to 52,095.
 
BAT slumped 6% to R495.67, tracking falls in its London-listed shares. On Thursday the US Food and Drug Administration announced restrictions on flavoured tobacco products, including electronic cigarettes, in an effort to prevent a new generation of nicotine addicts.
 
Investment house Reinet Investment was also under pressure, falling 6.7% to R215.58 after the company reported a drop in net asset value, a key profitability measure for investment companies.
 
 
Source: The Routers

Thousands of Cadbury chocolates have been sold to the public despite being past their best.

The chocolate, some of it months beyond its best-before date, was sold at a major KwaZulu-Natal South Coast wholesaler, which supplies spaza shops and trading stores, including in rural Eastern Cape areas.

And tens of thousands of rands worth of short-dated chocolate was dispatched to wholesaler clients hidden among newer stock.

These claims were made in the labour court in Durban last week.

 

It was alleged that ambitious sales targets led to massive overstocking in wholesalers.

Most resulted in multimillion-rand returns across KwaZulu-Natal of popular Cadbury brands, including Dairy Milk slabs and Lunch Bars.

A food health expert emphasised there was no risk in eating chocolate past its best-by date.

But a legal expert questioned the ethics of selling such products without clearly informing consumers.

The matter came to light when a sacked sales representative, Hans van Tonder, took his former employer, Diplomat Distributors, to court, claiming he had been victimised and that his dismissal was “automatically unfair”.

Mondelez SA, owners of Cadbury, contracts Diplomat, a logistics company, to distribute its products to wholesalers.

Diplomat fired Van Tonder in April 2016 for gross dereliction of duty after a company hearing found an instance where he failed to timeously report that chocolate at a Port Shepstone client was nearing its best-by date.

But Van Tonder produced emails that show Diplomat had been told by the client that it had been receiving stock with “mixed expiry dates”, which he argued was outside his control.

“It is a major concern as the inner stock on the pallet is short-dated,” wrote a buyer for the wholesaler, who asked what would be done to eradicate the problem.

Van Tonder, who had represented Cadbury products for 16 years, produced a dossier in court, including national stock return figures, emails and other documents which allegedly pointed to widespread problems with overstocking and short-dated stock.

Van Tonder was fired over a R21 835 loss to Diplomat at the Port Shepstone wholesaler.

This was the value of chocolate that had to be removed from the wholesaler in early 2016 after it had past its best-by dates, as well as money spent discounting and promoting the chocolate in a late bid to sell it.

A witness for Van Tonder told the court the R21 835 was “like chalk and cheese” compared with returns of hundreds of thousands of rands of Cadbury chocolate from many other wholesalers across the country.

Shadrach Chinniah, who resigned as a Diplomat rep in October 2016, said: “I thought it was absolutely ludicrous he was dismissed for R21 000 and my store had [old stock worth] R310 000 … why didn’t they dismiss me?”

He told the court a Diplomat manager “cleared” the R310 000 in minibars from a major Durban wholesaler “after it expired”.

The court heard the minibars failed in the marketplace nationally and the line was discontinued.

Chinniah alleged there were:

. Cover-ups by management;

. A lack of support for markdowns to move short-dated stock; and that

. Short-dated stock was hidden among newer stock before delivery, making it hard for merchandisers and reps to keep tabs on best-by dates.

Placed before the court were photographs that were said to show pallet loads of chocolates, all of which were beyond their best-by dates, “being sold on special” at the same Port Shepstone wholesaler, months after Van Tonder’s dismissal.

The pictures, apparently taken in June, show marked-down PS chocolates that had expired on May 25 2016 and Lunch Bars that had expired on April 25 2016.

However, these claims were not examined.

Early on the second day of the hearing, Bongani Khanyile, attorney for Diplomat, applied for the matter to be sent to the Commission for Conciliation, Mediation and Arbitration (CCMA).

He argued Van Tonder was seeking relief for an “automatically unfair” dismissal but had not made a case for this.

Judge Benita Whitcher agreed it was an “ordinary unfair dismissal case” rather than one that involved arbitrary discrimination and ruled her court would not sit on the matter.

An emotional Van Tonder stormed out of the courtroom.

“Three years of this,” he shouted. “They have been lying. I am going to go outside and break down.”

Whitcher later gave a written order directing the CCMA to expedite the matter.

No order was made for costs.

Yinon Ben Anat, chief executive of Diplomat SA said: “Diplomat’s policy is clear in that we do not purchase or sell expired stock [beyond its best-by date].”

He did not comment on claims of overstocking and declined to give details on Diplomat’s contractual relationship with Mondalez.

City Press sent Mondalez a list of questions on overstocking and its policy on the sale of best-by goods. The company declined to comment, saying the matter was before the courts.

“Mondelez SA abides by local legislation and we are focused on bringing the highest-quality products to our consumers,” it said.

 

Source: CityExpress

South African researchers say they have made bricks using human urine in a natural process involving colonies of bacteria, which could one day help reduce global warming emissions by finding a productive use for the ultimate waste product.
 
Although make from urine, the bricks do not have any foul smell.
 
The grey bricks are produced in a lab over eight days using urine, calcium, sand and bacteria. Fertilizers are also produced during the processes.
 
The bricks are made using urea — a chemical found naturally in urine and also synthesized around the world to make fertilizer. The process of growing bricks from urea has been tested in the United States with synthetic solutions, but the new brick uses real human urine for the first time, the researchers said.
 
“We literally pee this away every day and flush it through the sewer networks,” said Dyllon Randall, a senior lecturer at the University of Cape Town’s civil engineering department who is part of the team that developed the brick. “Why not recover this instead and make multiple products?”
 
One obstacle preventing mass production: the bricks use huge amounts of pee. To make a single brick requires about 20 liters of urine – a couple of weeks’ worth of wee for a typical adult.
 
“So, I get it from the boys bathroom opposite the laboratory. I put a little sign up and all the university boys contribute to my research,” said Suzanne Lambert, who proved the concept for the research by making the first brick.
 
“I definitely see commercialization in the next decade or two, but there is still a lot of lab work to be done,” she said.
 
 
Source: News24
Durban just added an impressive architectural and engineering marvel to its portfolio of landmarks. The Mount Edgecombe highway interchange was officially opened by transport minister Blade Nzimande and the South African National Roads Agency (Sanral) on Wednesday.
 
The Mount Edgecombe Interchange linking the N2 and M41 highways.
The interchange boasts a first for Africa, according to Sanral CEO Skhumbuzo Macozoma in an interview with the state broadcaster. He says it features the continent’s longest flyover ramp that stretches for one kilometre, linking the M41 eastbound with the N2 southbound, connecting surrounding areas like Phoenix and Umhlanga with Durban.
 
The Mt Edgecombe Interchange's flyover ramp stretches for about 1km and is dubbed Africa's longest.
 
The agency undertook major upgrades to the interchange from April 2013 to ease "chronic congestion of traffic" in the area, notorious for long waiting times, especially during the festive season, when South Africans flock to the coastal region.
 
The agency intends cutting travel time between the areas the interchange links from 25 minutes to one minute on average. The old interchange had traffic lights increasing waiting time; it has now been converted to a completely free-flowing system with limited stops, says Henk Kaal, resident engineer on the project.
 
 
Source: Business Insider
JOHANNESBURG - President Cyril Ramaphosa says the money pledged at the Investment Conference will translate directly to more jobs in the sectors that contributed.
 
President Cyril Ramaphosa declared the conference an overwhelming success that will yield thousands of jobs for the people of South Africa.
 
At the end of the conference on Friday, Ramaphosa announced a combined amount of R290 billion in investments In South Africa.
 
Over 1,000 local and international investors attended the conference at the Sandton Convention Centre.
 
Anglo American, the Brics Development Bank and automotive traders were the big contributors, investing R71 billion, R29 billion and R40 billion, respectively. Vodacom announced R50 billion in investment.
 
President Ramaphosa says prominent among these announcements are the themes of beneficiation, innovation and entrepreneurship.
 
“The number of new jobs and people who will be employed is going to be phenomenal and unprecedented in the history of our country.”
 
He says the country has battled with bringing in investment to generate growth.
 
 
Source: News24
Amazon will open additional data centres in South Africa at the start of 2020, it announced on Thursday.
The data centres will reduce latency and costs for local corporate clients.
They will also ensure that Amazon adheres to upcoming legislation to prevent personal info from being moved out of the country without consent. 
E-commerce giant Amazon will open additional data centres in South Africa at the start of 2020 to speed up cloud services for its local corporate clients and reduce costs, the multinational announced on Thursday.
 
This will add to the Amazon Web Services (AWS) data servers already built in South Africa, and will make Sub-Saharan Africa Amazon’s first infrastructure region in Africa.
 
The data centres will bring AWS in line with South Africa’s upcoming Protection of Personal Information Act, which will ensure that data is not moved out of the country without an individual's consent.
 
Andy Jassy, AWS CEO, said the new infrastructure region promises to reduce costs for corporate clients, improve security, and decrease downtime.
 
“Having built the original version of Amazon EC2 (the foundation of AWS) in our Cape Town development centre 14 years ago, and with thousands of African companies using AWS for years, we’ve been able to witness first-hand the technical talent and potential in Africa,” Jassy said in a statement.
 
“Technology has the opportunity to transform lives and economies across Africa and we’re excited about AWS and the Cloud being a meaningful part of that transformation.”
 
Pick n Pay, which employs over 80,000 staff across 1,560 stores, said it plans to move its eCommerce and data analytics systems to AWS.
 
“By moving our eCommerce and mobile customer application to AWS, from our previous managed services model, we estimate we have saved significantly on our total cost of ownership over the past year,” Chris Shortt, Pick n Pay’s general manager of information services, said.
 
Absa Bank’s Chief Information Officer Andy Baker said Amazon’s new infrastructure region will allow the bank to stop deploying hardware or other high-cost database solutions.
 
“Instead, our new tech stack utilizes low cost, fully automated, logically partitioned, open source software, with real-time security and application monitoring,” Baker said.
 
Amazon opened its first development centre in Cape Town in 2004 where it developed the early version of AWS.
 
In 2015, AWS opened an office in Johannesburg, and in 2017 brought the Amazon Global Network to Africa through AWS Direct Connect.
 
In May of 2018, AWS continued its investment in South Africa, launching infrastructure points of presence in Cape Town and Johannesburg, bringing Amazon CloudFront, Amazon Route 53, AWS Shield, and AWS WAF services to the continent.
 
 
Source: News24
New data from the Central Energy Fund of South Africa shows that the petrol price is set to drop by 3c in November. 
The possible decrease is attributed to a strengthening rand and a decrease in Brent crude oil prices. 
South Africa’s petrol price jumped to a record-breaking R17.08 in October; this would be the first decrease in eight months.
The South African petrol price is set to drop by 3c per litre in November, the first drop in eight months, new data from the Central Energy Fund (CEF) shows.
 
But the news is not all good: the diesel price is set for a massive 35c per litre hike. 
 
The possible decrease in the petrol price is attributed to a strengthening rand, and the global decrease in Brent crude oil prices, data from the CEF released on Wednesday shows. 
 
The CEF is a state-owned entity mandated to manage PetroSA and Strategic Fuel Fund (SFF) to secure South Africa’s national energy security. 
 
Hugo Pienaar, senior economist at the Bureau for Economic Research at Stellenbosch University, said things are looking increasingly promising for consumers in South Africa. 
 
“It is not only that the rand, on average, performed stronger against the US dollar, but the oil price also fell sharply from around $86 a barrel in early October, to around $76 today,” Pienaar told Business Insider South Africa. 
 
He said the petrol price may decrease slightly or remain the same as October prices when a formal determination is made.
 
The local petrol price jumped to a record-breaking R17.08 inland in October, and R16.49 at the cost. 
 
“I think the most important point is that the price [of petrol] will stay roughly the same, which in itself is positive after the sharp increases,” said Pienaar. 
 
President Cyril Ramaphosa set up an inter-ministerial committee in July to investigate possible interventions the state can make to lessen the effect of petrol price hikes on South Africans. 
 
The initial report was set to be completed by September, but has now been postponed to the end of November, energy minister Jeff Radebe said this week. 
 
 
Source: Business Insider
 
Naspers is planning to increase its stake in Indian online food-delivery business Swiggy as the startup plots its third fund-raising round of the year, according to people familiar with the matter.
 
Africa’s largest company by market value has indicated that it intends to support a financing that could raise more than $600 million, Swiggy’s biggest to date, according to the people. There’s also an opportunity to buy stakes from investors such as Bessemer Venture Partners, they said, asking not to be identified as the information isn’t public.
 
Tencent, the Chinese internet giant in which Naspers owns a 31% stake, is also planning to invest in the fundraising, according to one of the people.
 
Naspers declined to comment. Swiggy, Tencent and Bessemer didn’t immediately respond to emails seeking comment. The story was first reported by VC Capital website.
 
Swiggy’s value has risen to more than $2 billion after Cape Town-based Naspers led two previous funding rounds to become the firm’s biggest shareholder, according to the people. Naspers had a 22% stake as of the end of March. The company hasn’t made a final decision on whether to take part in the latest financing and may yet opt against it, one of the people said.
 
Naspers has targeted India for investments as the company seeks to replicate a blockbuster early bet on Tencent. The company made a $1.6 billion profit from the sale of its 11% stake in Indian e-commerce startup Flipkart earlier this year, and also has shares in travel business MakeMyTrip and classifieds business OLX.
 
Food delivery has been a favorite industry of Naspers, with assets including Germany’s Delivery Hero AG and iFood in Brazil. The company plans to invest in another Indian food company called Hungerbox, a tech-enabled corporate catering company, said one of the people.
 
Naspers shares have fallen 22% this year, valuing the company at 1.2 trillion rand ($83 billion), as a record slump in Tencent’s share price dragged down its South African investor. Naspers fell 4.% in Johannesburg on Tuesday.
 
 
Source: The Routers
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