Retail Reinvented: The power of retail and its potential to uplift and empower communities

Retail Reinvented:  The power of retail and its potential to uplift and empower communities

The shopping centre industry along with the retail sector is significant in the South African context. It is estimated that the retail sector employs about 21% of the workforce in South Africa, making it one of the largest employers after Government in the country. The industry rule of thumb is that for every 30m² to 40m² in a shopping centre, the industry creates one job. Fortress Retail hosted a webinar with industry thought leaders to discuss the profound importance of this sector not only in the economy but for the communities it serves and to discuss how can shopping centres and malls become a greater force for good in 2022 and beyond.

Moderated by Nozipho Tshabalala, the #RetailReinvented webinar included a thought-provoking panel discussion between Lynda Toussaint (CEO of Unjani Clinics NPC), Vuyiswa Ramokgopa (CEO of SAIBPP), Tim White (CEO of Profica) and Vuso Majija (Executive Director of Fortress Retail) who shared growth-powering insights gained from their experiences of working in and with the retail sector.

In summary, the panel discussed:
1. Community engagement: This is a cumulative process that can at times can be quite difficult. Trust between parties is built over time and developers need to be very deliberate about being in a real partnership with the community. There are benefits to good community engagement that allows for everyone’s voices to be heard and their needs to be considered.
2. The importance of bringing services into the retail space for consumer convenience: By using retail spaces as offices for government services like home affairs or establishing clinics, partners can benefit from the mall’s footfall, security and transport nodes, in turn providing a convenient option for consumers.
3. True partnerships between government and the private sector: While community engagement is important, the panellists all agreed that government and municipalities need to step up and play their part more effectively in order to make significant progress in job creation and improvement of services offered to communities.
4. Finding new ways to partner with government, retailers and the community: We need to unlearn old methods of negotiating and find new ways to create real partnerships with communities and municipalities that truly deliver modern infrastructure.
5. Putting communities first to make retail a force for good requires thorough research and market insights: Transport routes, access to the facility within the shopping centre and consumer behaviour needs to be taken into account to ensure the services being offered are actually utilised by the community and that the right balance of retail tenants, experiences and services are offered.
6. Design with the community in mind: The consumer should be the focus of the design process – who are you designing for? How are you designing the space with the community member in mind? For example, the panel gave insights around really understanding their transport needs, where do you put the clinics to ensure privacy of patients, queue management etc.
7. Integration of local businesses into the tenant mix: In general, when a mall is built in a township area, there is a micro-economy that emerges right outside the centre. What needs to be done to create formalised spaces for these traders? Is there an opportunity to generate non-GLA income, keeping in mind that they have credible businesses that make money. Enterprise development funding should be redirected to these traders, who are from the community.
8. E-commerce is a huge opportunity: Service providers can’t always provide door-to-door delivery in townships or rural areas, so existing retail spaces can act as last-mile delivery points. To make this a reality, partnerships with e-commerce providers are essential. This would not only bring more feet into the centres, but serve the community in more meaningful ways.

On community engagement, White commented that ultimately malls become ‘centres of action’. If the community does not feel like it is its their community centre, it ultimately leads to a loss of customers. Upfront engagement is key to avoid protests and disputes. He shared his experience of developing Gugulethu Square, a joint venture between a developer and a CSR fund. From the start, Profica engaged with the democratic structures in place and employed from the local area. The team went through a rigorous process of identifying who had the skills and setting up training programmes for the local community, as well as ensuring jobs were created/allocated to locals once the mall had been built. They identified the community requirements and considered how to bring in informal traders that had been operating in the area to create a CBD at the mall. By the time construction started, anyone who wanted to take issue with the developer had to go through the community structures that were already in place.

Toussaint shared her experience of partnering with shopping centres to establish Unjani Clinics, a private clinic network that serves the public patient by empowering black female professional nurses to own and operate their own clinic in low-income communities. Malls give nurses a safe space to operate from while enhancing access to primary healthcare to those communities in a convenient way, reducing waiting times and transportation costs.

Ramokgopa believes that government and municipalities have a critical role to play in ensuring that the community is served, infrastructure is provided and that social needs are met. Currently there is a gap between developers and municipalities that can be filled by having adequate upfront engagement and a partnership where everyone wins. This could see concessions being made by the developer such as financial contribution to infrastructure development or perhaps agreeing that the development includes a facility that houses social services. For this to happen, government has to step up and play its role effectively. There are cases where municipal managers do not have the required technical abilities or skills to negotiate with developers. Government needs to be well-capacitated to ensure that people who are responsible for approving developments have the correct training, access to research and data for decision-making and improved negotiation skills.

Majija shared his views on how reviewing the retail model as we know to allow for communities to be better served. When one considers a service like Unjani Clinics, it attracts additional customers to the centre while providing much-needed services. The clinic becomes a ‘semi-anchor tenant’. There are many examples of how these opportunities could be beneficial to both parties because shopping centres already have the infrastructure in place to accommodate community members, they are generally secure and the transport networks are in place. There are many ways in which developers could partner with government at shopping centres, but the industry generally doesn’t know who to speak to from Government. Therefore industry bodies like SAIBPP and SAPOA are vitally important because they should act as a bridge between developers and government.

Toussaint said, “We all want convenience, we all lead busy lives, we all have responsibilities and if we make life easier for our community populations, we need an omni-channel approach in order to make sure that all types of consumers are taken care of.” She reiterated that the success of the Unjani Clinic model is that where clinics are situated in a mall parking area, patients can access the services conveniently and at an affordable price, because the clinics are on a transport route or are close to the community.

White shared an example of how inadequate planning could negatively impact a development. Since shopping centres act as community centres, transport nodes and ensuring customers can get to and from the centre are important. “We designed an integrated shopping centre around a taxi rank, but didn’t go into detail about where the taxis would actually go. It was a long-haul taxi rank and the mistake we made was not realising that customers aren’t going to travel with loads of shopping bags on a long-haul trip. If the taxi rank had been for short trips, it would have been a lot more successful. Details are important – make sure investigations cover all aspects of the plan,” commented White.

On keeping the community in mind when designing a shopping centre, Ramokgopa shared her views about two schools of thought regarding the role of retail in uplifting communities: “On one hand, ‘big box’ retail has been critiqued for the impact it has on local entrepreneurship and its inability to integrate with local economies. On the other hand, there is a positive impact from the critical infrastructure and investment being made by developers. We need to develop more consciously to integrate communities and local entrepreneurship so that it doesn’t become an either/or situation.”

Majija discussed the mix of local and national retailers, and cited a study conducted by Fortress Retail on one of their township centres which concluded that 30% of the people who shop at that centre also shop at informal traders outside the centre. “How do we get government involved to work with us to develop these informal industries more? Shopping centres need variety and SMMEs bring variety, so it’s important to help them grow, particularly in the lower income market. We need to find new ways of working together to support and create more growth for entrepreneurs,” Majija commented.

Steven Brown, the CEO of Fortress REIT Limited, said, “We hope that everyone who watched the webinar is inspired by the prospects that are available in the retail sector. There are so many innovative ways to take advantage of the opportunities in a way that continues to uplift and empowers communities and we look forward to partnering more with government and the communities we operate in to serve them better.”

The #RetailReinvented webinar was moderated by Nozipho Tshababala, a conversation strategist moderating global conversations that are designed to have measurable outcomes.

Panel discussion speakers:

Lynda Toussaint: CEO of Unjani Clinics NPC. Lynda is responsible for the fundraising, implementation, management and rollout of the Unjani Clinic Network in South Africa, having taken it to 105 Clinics by December 2021; and has plans to scale it to 650+ Clinics by December 2030. Unjani Clinics NPC is a non-profit company and registered public benefit organisation established specifically to raise funding for, implement, train, monitor and manage the Unjani Clinic Network. Unjani Clinic empowers professional nurses to operate and ultimately own sustainable primary healthcare clinics in low-income communities, serving the employed uninsured market. There are currently 111 Unjani Clinics operating nationally, including 2 mobile clinics and 4 Health Pods.

Tim White: Founder and Group CEO of Profica, a professional services company providing construction and property solutions. Tim holds over 26 years hands-on, across sector experience of the management and delivery of large, high profile and complex projects in the Property, Construction and Civil Engineering industries. He has completed successful projects across many sectors, inclusive of retail, office, industrial, residential and mixed use.

Vuyiswa Ramokgopa: CEO of SAIBPP (South African Institute of Black Property Professionals), Non-Executive Director of Fortress REIT, Chairperson of NPPC (National Property Practitioners Council), Non-Executive Director of Multinet Home Loans. Vuyiswa’s dynamic career has seen her pursue numerous entrepreneurial ventures and gain a broad range of experience in various fields. She has received numerous awards and recognitions. She is a purpose-driven leader and change-agent who is passionate about equal opportunity, entrepreneurship, mentorship and development of the African continent.

Vuso Majija: Executive Director of Fortress Retail. Vuso has extensive experience in property and asset management of commercial, industrial and retail properties. He heads up Fortress’ retail portfolio and is responsible for all aspects of the portfolio, including developments, re-developments, extensions, national tenant relations, acquisitions and disposals. Vuso also sits on the board of the South African Council of Shopping Centres (SACSC) and is an alternate director on the Nepi Rockcastle board.