INDUSTRY OBSERVATION

SA Coming to a Grinding Halt?

The heavy rains and Eskom’s  constant load-shedding have prompted me to make some casual remarks: 

10 positives for victims of load-shedding

1. Who needs to go on a camping trip when we already live on candlelight and gas stoves/ braais?

2. You don’t have to wait at traffic lights for the lights to turn green. They aren’t working so proceed in your own time at your leisure. The rule of the road is for the other party to give way! First come first served rule! 

3. The Generator and torch business is enjoying boom times. 

4. Employees can schedule flexi time and take late lunches with impunity.  Chances are they will get a call from work confirming there is "no power" so they don’t have to bother returning to work for the day! 

5. The politicians say there is nothing to worry about. They have it under control. We trust them, right? South Africa has proven again that the equation: Politicians’ promises = Economic growth, hold no ‘electricity’! 

6. This ‘electricity’, or rather the lack of it, could be a subtle effort to get us acquainted with our ancestors’ way of life. 

7. This is our contribution to global warming environmental initiatives. 

8. This is a good driving lesson for those who work in office blocks. Rules of the road apply in the passage ways. This teaches and prevents staff from bumping into each other in the darkness. They can then apply these lessons learnt to the road! 

9. …………Let there be light………..and there wasn’t! 

10. Your spouse might not be that impressed with another candlelit dinner!

2008 has kicked off with significantly different challenges for Operators and Insurers. 

From the Operators perspective:

Truck and vehicle electrical systems luckily are not reliant on Eskom. Traffic congestion is a formidable planning problem in and around Gauteng. If operators are not careful, a routine delivery will turn into an all day task. Long haul Operators will find that if the vehicle is not at the off-loading point by say 7am, the time delay wastes a day!

Dare I say it? I would plan operations around all the ‘rat runs’. The problem is who else is thinking the same way and clogs the ‘rat runs’? 

Surely operators will start charging city deliveries per hour rather than kilometerbased rates as transporters cannot be held accountable for delays. In fact, we have seen one or two operators begin to do this. Not all operators are in a position to do this though as they are not in a position to set revenue rates. 

I have great admiration for some Transport Operators. I think their quality will be tested this year with some major challenges lying ahead. These will include trucks arriving at off loading points to find the cranes can’t work because of the power failures.

From the Insurers perspective:

We are going to be plagued with a whole new range of "claim descriptions", including: Traffic lights out of order; accidents (boy are they going to be high this year), especially with respect to road conditions where road maintenance seems to have collapsed after the incessant rain. Talk about undercarriage damage! There is a veritable minefield (excuse the pun) of legislation regarding road conditions and Insurers’ liability. 

As an example of gearing up for adversity, refrigerated businesses have already anticipated the problems, purchasing extra generators and alternative power supplies. 

These are just a few of the challenges. We do have many capable managers in SA but their limits will be seriously tested this year! Sure, 2008 could be the "big" year you’ve been waiting for, but in what context?