Shared Interest News

Today, South African Women’s Day, we are thrilled to share with you a radio segment that aired last night on Marketplace (http://marketplace.publicradio.org/shows/2007/08/08/PM200708087.html a leading business and financial radio program, featuring Shared Interest’s innovative model to expand credit and banking to impoverished communities in South Africa. Marketplace is currently broadcast by more than 330 public radio stations nationwide with more than 8 million listeners.

With reporting in the U.S. and South Africa, this radio segment highlights the passionate commitment of the Carlisle investor group to raise resources for Shared Interest and entrepreneurs from the successful Hands-On Fishing project in the Western Cape.

 To hear the segment please click on http://marketplace.publicradio.org/shows/2007/08/08/PM200708087.html.

(Please consult the market place website www.marketplace.org) to find out when the radio program is aired on your local station.) Please also feel free to share this email with at least five other people, so they too will be inspired to build support for economic justice and democracy in South Africa. For more information on Shared Interest and how you can advance this work, please visit Shared Interest us at http://www.sharedinterest.org.

In the article below, we are pleased to spotlight Neo Mogape, Production Manager of Tropical Mushrooms – one of the unsung heroines of South Africa’s small business sector.  She is one of the 750,000 women who have benefited from our work since 1994.  One of the many who are leading South African women’s daily struggle to sustain their families and communities, and reshape their country’s economy.  We invite you to celebrate this day with us – and with them.

 Donna Katzin

Executive Director

Women Help Small Businesses Mushroom

In South Africa, small and medium sized community- based businesses are mushrooming - literally. And women are playing a leading role in their success.

In Magaliesburg (Northwest Province), Neo Mogapi - one of the first people employed by the country’s only major black-owned and black-operated mushroom grower, Tropical Mushrooms - manages production and supervises 18 pickers. Neo, in her late 20’s, cares for her three children before beginning work early in the morning, and sometimes works into the night. “If you leave the mushrooms they will open, and the people will not buy,” she explains. “You have to finish.”

After completing high school, Neo went to work at Denny’s Mushrooms, South Africa’s largest mushroom company. But she was only offered a part- time job. When she heard that Tropical was opening a new company, she applied with hopes of obtaining full- time employment. Tropical recognized her skills and commitment, and selected and trained her to manage, train, and hire the mushroom pickers - most of whom are women from her community. In this position, Neo has played a key role in establishing Tropical’s policies, practices and productivity. She and the other original employees currently own 18 percent of the company through an employees’ shareholder trust - a share they hope to increase in the future.

The company’s 65 full-time employees earn approximately R1035 a month, which far exceeds the minimum rural wage of R800 a month for rural jobs in areas like Magaliesburg. They also receive benefits including a retirement fund, group life and funeral insurance. Named South Africa’s Best Agricultural SMME in 2003, the company also makes charitable donations to not-for-profits organizations serving impoverished, abused and HIV-positive women and children.

Tropical’s history reflects the changing profile of small black-owned enterprises in South Africa. When Peter Nyathi and the employee-owners launched the business in a highly conservative area of the province in 1999, they struggled with white suppliers, who thought they could take advantage of them because of their color. They quickly disabused the suppliers. At first, Tropical needed to send a white agent to sell their product. Sales went well, until one of the white clients asked the name of the company’s owner. When he heard the majority owner was “Nyathi,” he dumped the samples on the floor and threw the agent out of the shop.

Recognizing the limits of the local market, Tropical began to sell to both wholesalers and some of the larger retail chains, such as Pick & Pay and SPAR Stores, as well as pizza restaurants. The company increased its sales revenue from R1.6 million to R4.6 million between 2001 and 2005. One of the country’s largest retail chains, Pick ‘N Pay alone has indicated an interest in tripling its current purchases. At times demand outstrips what the company can supply.

Neo’s biggest challenge as a manager? “The customers!” she answers without hesitation. “They become cheeky. They begin calling at 5:00 in the morning and want their mushrooms that same morning. If I tell them we do not have as many as they want, they say, ‘don’t tell me that!’ What am I supposed to tell them?”

Tropical’s growth is supported by the South Africa’s black economic empowerment (BEE) scorecards that give higher points to companies that are themselves black-owned or purchase from black-owned businesses. Quality-producing small and medium sized black-owned businesses, like Tropical Mushrooms, have a leg up, as BEE codes require public procurement officers to factor a company’s BEE performance into all purchasing decisions. This means that the wholesale companies that buy Tropical’s mushrooms receive a better BEE score and have a better chance of receiving orders from government agencies.

In order to expand to meet increasing demand, Tropical needed capital. With the help of a Shared Interest guarantee, the company has obtained a R4,066,666 loan from ABSA Bank, and plans to construct additional buildings, purchase equipment and hire 35 more workers. The goal is to double the size of its growing area and boost output by an additional 115%, elevating projected sales revenues to R11 million. Currently, the fifth largest mushroom producer in the country, Tropical plans to become the third largest and employ 100 people.

Neo is confident that as the company expands, she will have no difficulty supervising the anticipated 35 pickers, as she knows the business and is comfortable as a manager. She has developed her self-assurance and leadership on the job. “I used to be a quiet person,” she recalls. “But to work with people, you have to talk. Now I can talk.”

As the company grows, Neo feels a sense of satisfaction and ownership. She recalls with pride, “I picked the first mushroom.”