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Last Updated: Wednesday, 11 October 2006, 22:09 GMT 23:09 UK
Black boss revives SA clothing firm
By Jamie Robertson
BBC World business reporter in South Africa

Businessman Fred Robertson
Fred Robertson is a self made millionaire

Fred Robertson is a self-made millionaire, one of the generation that burst out of the confines of apartheid and grasped every opportunity available.

He's now deputy chairman of Brimstone Investment; but a mere 15 years ago he was selling insurance door to door.

A few months after Nelson Mandela walked free from prison Fred was scraping together funds from the only sources he knew - his own community.

"They were ordinary working people," he said, "some small businesses as well. They came in by themselves, some in savings clubs, putting their money together: many still come to our shareholder's meetings every year."

Those original investors have done well.

Brimstone is now listed on the Johannesburg Stock Exchange and has investments in businesses ranging from food processing to insurance.

Clothes for the middle class

In 1998 he bought the House of Monatic, a 90-year-old garment manufacturer that most people believed was on its last legs.

What Mr Robertson recognised, and what the former white owners had failed to spot, was that a market was emerging from his own community.

Along the corridors of the head office the company's magazine advertisements are arranged in chronological order.

The decade-old suits and shirts unsurprisingly look dated; but it is the models that stand out. They turn, year by year, from white to almost exclusively black, sporting brands such as Viyella, Carducci, Yves St Laurent and Embassy.

"There is a large new black middle class," he says.

"They are people who want to taste the benefits of the growth of a free market, of a new democracy. Our economy has grown 4.5% for the last 10 years and these are all new consumers coming on to the market."

Cascade effect

Mr Robertson's business is an example of what the architects of Black Economic Empowerment (BEE) had hoped for - a so-called "cascade" effect, where the success of one black entrepreneur would cascade down to those coming up from below.

The BEE rules demand that the various stakeholders in the company must increasingly be black.

So the House of Monatic trains new designers, sales staff, and managers, and it buys supplies from other black empowered manufacturers, like the other companies under the Brimstone umbrella..

Across the economy black empowerment has increased the demand for experienced black personnel.

Their skills are at a premium.

White flight

Meanwhile white professionals have responded to their lowered status in a number of ways.

Some have taken redundancy and set up on their own - there's been a boom in consultancies across the country - but many frustrated whites have simply left the country.

The skills deficit is something that worries Albert Schuitmaker, Director of Cape Town's Chamber of Commerce.

"What we need is more skills transfer," he said.

"The government has started to say we should bring back white skills, and go into the international market and recruit skills from different countries with the specific task, not only of using those skills, but transferring them to local black people and black entrepreneurs."

With the emphasis on hiring black staff rather than white, there are tales of black professionals hired into positions they cannot cope with, or white staff being unfairly passed over.

'Got to be profitable'

Jim Sutcliffe, Chief Executive of financial services group Old Mutual, remembers the historical context.

"There are some people who are promoted to positions that they otherwise might not have been in. But then there are people in jobs that one might claim they are only in because of the past."

The country's challenge is to redress a skewed labour market while simultaneously keeping it free and meritocratic.

Fred Robertson sums up his philosophy.

"We have got to be profitable, empowering and have a positive social impact, and that has to be policed, checked on month by month so we fulfil our duties as the new captains of industry. The free market we think and dream about has to be an inclusive market."


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