Johannesburg – South African retailers including The Foschini Group and Woolworths Holdings are increasing investment in local clothing manufactures – both to reduce a dependency on Chinese imports and secure a supply chain thrown into disarray by Covid-19 restrictions.
The companies have signed up to an industry plan that includes a target to source 65% of their goods from local manufacturers within the next decade. While progress towards the goal varies per chain, the spread of the coronavirus has sharpened their collective focus.
The pandemic caused “such disruptions to the supply chain that everyone’s sitting back and saying do we ever really want to be that reliant on China ever again?” said TFG chief executive officer Anthony Thunstorm in an interview. “I think the penny’s dropped and retailers are looking more and more to buy locally.”
The initiative comes as South African President Cyril Ramaphosa looks to revive a manufacturing industry that’s deteriorated since the lifting of apartheid-era sanctions two decades ago, which enabled companies to seek cheaper alternatives from overseas suppliers.
Re-establishing the sector would help achieve a goal of creating jobs, easing an official unemployment rate that’s at a 17-year high.
“As South Africa opened to trade in the late 1990s, China came in and decimated the market as cost was the only dictating factor,” said Lawrence Pillay, head of sourcing at Woolworths. “But the world has changed radically and there is now so much more than just the cost. Sustainability, carbon footprints, challenges of logistics — all of these factors are going to force a rethink.”
