There was once a thriving local textile production industry in South Africa employing thousands of people, a country which now needs radical job creation. The three-year-old Retail, Clothing, Textile, Footwear, and Leather (R-CTFL) Master Plan outlines a vision for how to revive this sector and with job creation as a key objective. It sets out a vision and a strategy for the industry with the aim of job creation and economic growth through localisation.
Signed by major CTFL retailers, manufacturers, labour unions, and the government at the 2nd Presidential Investment Conference in 2019, the Master Plan is a first-of-its-kind commitment between the R-CTFL industry and national government. Three years on and the move to localisation is growing.
Retailers are leading the way. “We are seeing a far more developmental shift in the way that retailers are engaging with their local suppliers. They are seeing the benefit of local, not just because it is patriotic, but because it makes business sense,” says Courtney Barnes, facilitator of the Cape Clothing and Textile Cluster and the KwaZulu-Natal Clothing and Textile Cluster.
This business sense is fundamentally about agility and speed to market. By producing on local shores, retailers can respond to current trends and get their products to market faster by cutting out the three-month transport time that is required when producing in countries like China.
What progress has been made?
The Master Plan defines its vision as: “A competitive, sustainable, and dynamic R-CTFL value chain that provides its customers with compelling products and that is invested in growing employment and advancing inclusion and transformation.”
It outlines seven commitments with strategies. Here are a few notable progress points from the past three years.
Encouraging people to buy local
The first commitment was on growing the market for local CTFL producers. The big focus there was on “buy local” campaigns, creating commitment to market and label local brands in “Proudly South Africa”.
Increased localisation by retailers
The second commitment was on increasing local CTFL procurement and ensuring that retailers are working towards sourcing 65% of the products they sell locally from South African manufacturers. A few of South Africa’s major retailers – including The Foschini Group (TFG), Pick n Pay, Cape Union Mart, Woolworths, PEP, and Mr Price – have been making strong strides in this direction. TFG have increased their local sourcing from 35.7% to 47% in two financial years.
“What I have found interesting is that many competitors are joining together for a common purpose whilst keeping their competitive edge protected, which is not always very easy to do,” says Hazel Pillay, General Manager at Pick n Pay. According to Hazel, Pick n Pay aims to source up to 60% local in the next 5 years.
Job creation through localisation
According to the Quarterly Labour Force Survey for the first quarter of 2022, South Africa’s official national unemployement rate stands at 34.5%.
The commitment to local sourcing has been accompanied by job creation, as the story of the Msinga Clothing Factory that makes garments for TFG, Mr Price, and Ackermans. in KwaZulu-Natal shows. The area used to be home to a shoe factory that closed its doors 26 years ago and left 3000 families without any source of income. To reduce the unemployment rate and poverty in the area, Lelly Mntungwa, 42, started the factory in 2016. The factory now employs 150.
Due to a focus on localising production, local retail company, TFG – housing Foschini, Sportscene, The Fix, Exact, Markham – foresees employment within its owned facilities and strategic non-owned partners grow from 5,200 in 2021 to 11 200 by March 2025.
Curbing illegal imports
Stopping illegal imports is vital to ensuring that more jobs can be created locally. “We have seen increased focus by SARS and the Department of Trade, Industry, and Competition on this front,” says Courtney.
Introduction of the woven fabric rebate
This means that if producers commit to certain offtake agreements, they can import woven fabric – of which we don’t have much local capability – and receive a duty rebate. “This can reduce the cost of a product by about 12% which means significant gains in competitiveness and makes it more affordable to produce locally,” says Courtney.
Introduction of the CTFL growth plan
This is a funding mechanism from the Industrial Development Corporation of South Africa which supports capital investments and upgrading across the value chain. The growth plan operates as a cost-sharing model between local industry (30%) and national government (70%) to co-fund investment in the supply chain. “Whether that be through improved machinery, process improvement, or strategy support, it’s about building the local supply chain to that retailers have a competitive supplier to purchase from,” says Courtney.
Compliant manufacturing
There is a growing focus on compliant manufacturing and labour standards. “We are far more aware of where our clothes are being made and South African Bargaining Council compliant factories can offer that certification of a sustainable labour force,” says Courtney.
The largest manufacturers in the Western Cape are PEP Clothing, the Prestige Group, K-Way, and Green Thread. According to Courtney, they are all Bargaining Council compliant.
Is sustainable production a focus of the Master Plan?
“The Master Plan does not adequately recognise sustainability and decarbonisation,” reads a recent TIPS report titled “Designing climate-compatible industrial strategies for South Africa: The textiles value chain”.
While one of the Master Plan’s objectives is to ensure the South African R-CTFL value chain is recognised as ethical and environmentally responsible, this is not elaborated on. And, none of the seven commitments acknowledge climate change or environmental sustainability.
“The focus is far more on growth and jobs than on sustainability. I don’t think that speaks to the intent of the Master Plan – I think it was just the focus of the industry at the time,” says Courtney.
While the need for sustainable production becomes more urgent in the fashion industry, local retailers are making necessary shifts when it comes to annual reporting, appointing sustainability executives, and focussing on on-shoring production. There is also a greater emphasis on sustainable production, including using organic and Better Cotton, increasing recycled content, and reducing hazardous chemical use in textiles.
Manufacturers are also starting to support this shift. Two such manufacturers, with sustainability as a core focus, are ACA Threads and the Equator – The Belt Factory.
Moving forward, a greater focus on sustainability and decarbonisation in South Africa’s textile value chain is essential. One of the first activities to undertake will be the setting of greenhouse gas emission targets suitable for the South African textiles value chain, states the TIPS report. While local sourcing is also acknowledged as an overarching intervention, other proposed interventions suggested by the report include:
- Reducing hazardous chemicals and improved water management
- Optimising manufacturing energy consumption
- Promoting fibre-to-fibre recycling and product longevity
- Reducing single-use sanitary wear
- Adopting clothing and footwear leasing models, and
- Increasing the secondhand clothing market.
What citizen consumers can do
The simplest thing to do is to look at the labels of the clothing and check where it was made says Courtney. “If it says ‘made in South Africa’ it means that someone is being employed in SA, it means that you are probably reducing the carbon footprint of the product.”
In the early 1990s, South Africa had a booming clothing and textile industry which accounted for a quarter of a million jobs. Two-thirds of jobs were lost in the two decades after the end of Apartheid due to restrictions around international trade being lifted. The industry is being revived. This time, sustainability and ethics are being considered.
- Cover image: Equator – The Belt Factory
- Read the full South African R-CTFL Value Chain Master Plan here.
- Read the TIPS report titled ‘Designing climate-compatible industrial strategies for South Africa: The textiles value chain’ here.
- Read Twyg’s interview with SACTWU’s Etienne Vlok about the Master Plan here.
