A R10 billion market sector employing up to 70 000 people. These are statistics one expects of a rapidly growing segment of the formal economy. But perhaps surprisingly, they relate to the humble township street food staple, the Kota, and hold significant potential for producers of the many ingredients used in these quintessentially South African meals. Dairy giant Parmalat has not only devised an innovative way to tap into this market, but to nurture unparalleled brand loyalty among Kota sellers too.
Similar to a bunny chow, the Kota comprises a hollowed-out quarter-loaf of bread filled with various ingredients, including hot chips, polony, Russian sausages, egg and cheese. It was the cheese that presented the window of opportunity for Parmalat, and that resulted in it unexpectedly supplying a premium product – individually wrapped and branded single cheese slices – to informal fast food and retail outlets in townships across the country.
That move now sees Parmalat leading the Kota market as the preferred single cheese slice provider – no mean feat considering it is estimated that 200 million cheese slices are consumed in SA every year, equating to 15 cheese slices sold per second every day, in a market (cheese slices) valued at R1 billion a year.
This market position has yielded significant returns for the company. However, it wasn’t this exponential growth that captured the attention of the dairy market leader, but rather the opportunity to support these informal businesses in such a way that their businesses would flourish as a result.
“It was this thinking that gave rise to the Parmalat Phuma Phambili programme in 2015. We consider small businesses to be the economic heartbeat of South Africa, and believe they need all the help they can get to not just survive, but thrive. We soon realised that beyond just selling our products to township fast food and retail outlets, we could actually add value to their businesses by helping them become more sustainable and creators of much-needed local employment,” explains Parmalat CEO, Paul Verhaak.
The programme aims to support and promote small businesses in the informal market; work with emerging fast food and retail businesses as a business enabler; and give these township start-ups a much-needed competitive advantage. The Parmalat Phuma Phambili programme was conceptualised by GG Alcock, CEO of Minanawe Marketing, whose strong consumer insights and in-depth understanding of townships enabled him to recognise the potential of Kota’s in this invisible matrix at the heart of South Africa’s informal economies.
To participate, Kota-producing outlets must register their businesses in the programme; buy and use Parmalat Cheese Slices in their Kotas; and then monitor and track their sales as a result of using South Africa’s No. 1 cheese slice in their meals.