Kamogelo Olaitan
When Phure Motshabi from Kagiso, West Rand was approved for the Pick n Pay township franchise revitalisation programme, he saw it as an opportunity to take the family business to a new level.
The scheme looked straightforward: for a small fee, Pick n Pay will supply ailing stores with high-quality stock to turn them into thriving businesses.
But four years later, Phure is without his business and has been left with more than R9 million debt. He calls the programme a scam that only benefits Pick n Pay.
Motshabi said he was operating a fish and chips and shisanyama business which pulled in over R20,000 every month when he heard about the programme. He wasted no time and soon went into business with Lekale Mashego who became his partner.
With a loan from Old Mutual Foundation, Phure transformed his family store into a modern enterprise named Phenyo Market.
But soon after opening the store in 2017, cracks started showing when the first stock arrived.
“Pick n Pay sent stock that was not suitable for township customers, we had the most expensive coffee and swimming pool cleaning detergents,” he said.
His store was overstocked, with some goods expiring soon. With Pick n Pay’s no-reverse policy, he had no choice but to write off stock, losing money in the process.
If that was not enough, Phure says two months into the business Pick n Pay told him the renovators claimed they had undercharged.
“Pick n Pay took the R300,000 grant I received from Gauteng Enterprise Propeller and paid the contractors,” he said.
“The money was meant to pay back the creditors.”
In 2018 and 2019 he says the supermarket took more than R600,000 in tax rebates from Sars.
“That’s when I stopped using their accountant,” he added.
With all the frustrations his partner left the business.
By October 2020 he owed Pick n Pay R1.8 million and he was given 48 hours to settle the amount. They then insisted that they take over the store and when he didn’t agree, he received a notice of termination from Pick n Pay.
He was given one month’s mandatory notice and was told the agreement would be terminated on 12 November, 2020.
“I continued trading but they switched off my systems. I couldn’t order supplies from anywhere else and my business started collapsing. For those three years I didn’t mismanage the store or downscale,” he said.
In April 2021 all systems were switched off. When he was forced to close the shop 36 people lost their jobs.
Pick n Pay is demanding more than R3 million. On top of that, Phure still owes suppliers, some of the employees that took him to CCMA and loan repayments.
He has been left with no choice but to liquidate his business.
In a response to Scrolla.Africa, Pick n Pay said Phenyo Market is a good example of their tireless efforts to turn a store around but the owner was unwilling to accept their guidance.
A Pick n Pay executive said they have an automated stock replenishment system which recommends an initial order based on similar stores operating in similar communities.
“Pick n Pay can’t withdraw money from anyone’s bank account and every financial transaction is conducted with the necessary approval and authorisation,” said the executive.
