Pick n Pay chairman Gareth Ackerman is uncertain about the role black industrialists will have in driving transformation in the retail sector, as the capital-intensive nature of the industry poses a barrier to entry for many new suppliers. Speaking on the sidelines of the Consumer Goods Council of South Africa summit in Midrand on Wednesday, Ackerman, when asked about the role of black industrialists in transforming the sector, said: "They've got to get interested first. I don't think they are interested because it's very high capital, and it's not very high return. "So you've got to have big capital and it's all about scale, and returns generally at the retail level are low."Ackerman said that in the current market environment most food retailers achieved low single-digit growth in revenue. The money was to be found in manufacturing. "These black industrialists want lower-risk businesses, lower utilisation of capital, and higher returns, and the food industry is either high-capital...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.