Remembering Raymond Ackerman: A Legacy of Retail Excellence and Social Impact

While earlier today Pick n Pay released a statement sadly announcing the passing of founder Raymond Ackerman at the age of 92. The retail legend founded Pick n Pay from just four stores 56 years ago and turned them into one of South Africa's leading grocery chains. Today it generates 106 billion rand in annual turnover and owns more than 2,000 stores across the country and even in other African states. Let's take a look at this short clip from the documentary series Titans of Africa which previously aired on CNBC Africa in 2013 profiling the life and times of Mr. Ackerman. It was amazing my brother-in-law in Cape Town said Raymond come back to Cape Town. I said how can I? We've got our life up in Joburg and he phoned me a week later and said I've got a business the guy wants to sell. He's got three little stores called Pick n Pay and he wants to sell. Come down. It wasn't quite as easy as I'm saying because it's a long story but I came down on a Tuesday and by Tuesday night I'd bought this business with no money. I had no capital. I just had my salary from great events. This guy wanted 600,000 rand 620,000 rand and I had zero capital. He had three days to get the money and the idea was to get about 40 or 50 shareholders to join me but for me to have the control afterwards it was quite a tricky thing to do and this guy organized it all and a friend in Joburg got 25. 25 in Joburg and 25 in Cape Town. And we had the money by Friday and we bought Pick n Pay. He's always said it's 10 percent capital 90 percent guts and feet on the ground head in the skies dream just keep your dreams but keep your feet on the ground. Too many people are scared to open their own businesses because of lack of capital. It's understandable but you should never worry about that if you've got the right idea and the right concept or the right mousetrap you'll always find ways of getting the capital either through friends family or today there are many companies helping businesses get capital. 90 percent guts 10 percent capital. The Ackermans took with them into their new business the lessons they learned from Bernard Trujillo during their trip to the United States. He taught me the four legs of the table. If you run any business it's four legs of a table with the consumer sitting on the top that everything must be geared for the consumer and it's so linked with what Hutter taught me the professor that I had a philosophy that I just knew was right and we built Pick n Pay basically on four legs of the table. I think it works the philosophy is that you've got the consumer sits on the table and you've got the four legs of the table it's a very good business model around which to run a business and we use it and we use it extensively in the business. Why not listen to your customer it makes the most common sense and that's the amazing thing about my dad he has got such common sense for certain things other things he's not brilliant at but he's got such common intuition and follow your intuition listen to the customer you're there to answer her needs at every beck and call. The real focus must be always on the consumer and do what is right for the consumer because if you look after them the consumer then looks after you which is the fundamental ethos. So it's not striving for profits first. No let's always do what is right and a lot of the real investment we're doing in Pick n Pay at the moment is not to create profit right now but it's to make sure that the business is properly structured so we can bring lower prices to our consumers at the end. Profits are like your bloodstream you need them to grow to build pay salaries bonuses expand but it shouldn't be your be all your be all should be your consumer or your patient if you're a doctor and I think therein lies what I hope is a legacy that other businesses will follow and do more of because we need a lot of that in this country. The dominant Ackerman and Pick n Pay philosophy of listening to the consumer had its genesis early in Raymond's life when he took seriously what Professor Hutt and Bernard Trujillo had to say. And the secret if I may say for a lot of young people is they tend not to listen to older people if I hadn't listened to these two guys and felt wow what they're saying is right I wouldn't be here today. Generally people don't listen that's whether you're younger or older people don't listen and I think that was the secret one of the secrets of Raymond's success is he's never been arrogant or I know better I'll never forget Trujillo gave us a list of 10 points which were which stymied growth we always kept that and when young people came with ideas we would say that's an interesting idea let's try it not we've tried it and it didn't work maybe we tried it and it didn't work but it wasn't the right time and we were too early or something very often our ideas were far too early we tried them again and then they worked. I said at the beginning it was Hutt and Bernard who influenced my whole life I can't tell you how important that was for me when I lost my job in Greatermans I nearly joined another company because I was scared I had a wife and four kids and I remembered his 90% cuts 10% capital and if you have the right mission and a young person who says I can find a better way of doing something and really is passionate about it there'll always be people who can supply the funds and that's a very important concept for young people in Africa for the future. Well that was a short insert from Titans of Africa Raymond Ackerman a documentary series produced for CNBC Africa by ABN Pictures. Well of course it would only be fair for us to reflect on the legacy of this retail royalty and of course the impact that Raymond Ackerman together with his business have really had on South Africa's society from an economic and social perspective. Joining me now is CNBC Africa's Godfrey Mutizoa. Mr G you've been following this business for quite some time and actually I have interacted with Raymond Ackerman as well share some perspective as to how that experience was. Yeah certainly certainly I wanted to say to you as well ABN Pictures is actually a lady who sits in our newsroom Jill De Villiers she was head of ABN Pictures and she worked together on that story with Chris Bishop who used to be editor of course of CNBC Africa founding editor of Forbes Africa so it's a story that we're well versed in but personally this is a story for me that began in 2001 when I came to South Africa joining Bloomberg News and working as a reporter. I covered the retail sector I covered pick and pay I covered show pride and these were companies and stories that I was intimately involved in so it's a sad day but I think for me more than anything it is a day to celebrate a great man who changed the face of retail in South Africa at a public level this was a publicly listed company in the private level when you go of course through the history of where he came from. Exactly and maybe let's reflect on that history there Mr G because this was a gentleman who was actually born into a retail family his father actually started Ackermans the clothing retailer that many of us are familiar with and that was actually his first job if I'm not mistaken as a trainee manager but after many years of experience and of course even working under the shop right brand then later actually started pick and pay from four stores 620,000 rand startup capital as he alluded to in that video clip which is phenomenal to think about right now given the size of the entity. Absolutely absolutely 620,000 rand that's been turned into a 50 billion rand market cap company I mean bid that if you can in terms of returns incredible there's no question about it but at the same time I actually wanted to say to you when I was right running through all the stories that have been written about him I actually realized he founded pick and pay but he also founded shop right right right exactly and it's quite interesting to say how that those two particular brands have been exactly competition exactly I came in at the point when pick and pay was bigger than shop right by market share by turnover by number of stores opened and the story over the years in the 20 what 22 years or so that I've been here has absolutely been appended and now we know of course that shop right is so much bigger I mean I was looking at the numbers in terms of turnover in terms of sales annual sales you spoke the number yourself 106 billion rand well that story is now turned right shop right 215 billion rand double the size of the sales of what used to be a smaller competitor. That's a very valid point that you mentioned there Mr Jain I think for many investors does ring a bell but I'm also I understand that Raymond Ackerman did have an opportunity to actually buy Checos at some time as well as OK Bazaars but actually then sidestepped and didn't actively participate in that acquisition which I understand from some of the research is a deal that he actually regrets. Yeah and then the rest is history of course because we now know what went on to happen and perhaps maybe maybe if we had been had an opportunity to talk to him maybe he would have said perhaps I regret that but perhaps not but one of the points in terms of this story that I remember very well as a reporter covering this sector was the fact that as I said to you pick and pay used to be bigger than shop right but one of the big steps that shop right took that enabled it to uh uh uh leapfrog a pick and pay in terms of size was the entry into Africa. If you remember YT Basson became active on the African continent before pick and pay started talking about it though they were in the region but not in the rest of Africa per se as we know it. As we also know of course that story didn't end well with shop right quitting Nigeria and coming back home but certainly at the time it enabled them to get in extra sales that were not available to pick and pay and then when you also come here one other point that are in the story that I find interesting is the transition that happened in the two groups of companies. You had YT Basson and I think we can talk about YT Basson and talk about Raymond Ackerman at the same time because they were leading the companies together at the same time for some at some point but I remember one of the issues that pick and pay was struggling with was managing the existence of the company as a publicly listed company on the stock exchange but controlled by a family whereas with shop right you had a company publicly traded and owned by institutions and from talking to analysts from talking some investors you get the sense that that may well have perhaps left pick and pay in a disadvantaged position because here you had people who were commercially focused and driving the business not worrying about family values and all those other things that you may well bring onto the table whereas here you get a man with very very strong beliefs as we all know this is a guy who fought against apartheid this is a guy who took on the monopolies. Exactly it's such a valid point that you mentioned because even when you take a look at the positioning of the executive team of both pick and pay together with shop right it does seem as though shop right has had leadership that has been entrenched for a lot longer and as you say commercially driven versus the erratic constant shift and changing and high frequency of leadership at pick and pay if we think about Peter Boo and Richard Brasher and all of these are international talents who are expected to adopt to I guess the family values and culture of the business. Absolutely and the other point also if I remember correctly was the whole strategy around distribution centers I don't know if you remember the conversation around distribution centers when they came in it was such a big thing and shop right again was quicker out of the blocks in terms of establishing distribution centers and pick and pay came in later I particularly remember this story because they built that distribution center you know along the N3 South when you are headed towards Kempton Park you see it on the left side of the road huge thing huge thing at the time it was a big statement but many felt it was a statement that came a little bit late. Interesting dynamics if we take a look at the leadership of both businesses and of course how this is translated to growth and operations and even looking at their most recent results Mr G what intrigues me as well about pick and pay is again the concerns that they're not expanding as effectively and maybe this is an aspect an area that we could actually delve into shop right definitely dominating the e-commerce space pick and pay recently trying to go into quality safe discounted prices with boxer stores naturally trying to compete with the likes of yeah and that was a big step change wasn't it because for years our shop right had been very clear in terms of what they were if you are talking shop right checkers you're talking upper echelons of the market if you are talking uh they they are what is that store um hungry lion you know which segment of the market they are talking about if you are talking the shop right brand on its own you know what you are talking about whereas with pick and pay it was pick and pay and then they realized that they were missing a step they they needed to uh what's the word uh segment their customer basis it were so now you've got quality safe now you've got boxer and now you've got the other upper side but i must say at a personal level i'm a pick and pay person you're a pick and pay person i go to pick and pay interesting you mentioned this mr g so i'm part of the digital generation that does their groceries online people and funny enough checker 6060 has been the magic that's your friend that's my friend quick easy efficient even beats woolly's dash from my personal experience because it just makes it so much easier to use and work with as an interface sure but interesting that you mentioned this particular theme as to what we prefer uh as consumers because it also highlights just how exactly these big businesses have also put in sustainability as a key factor for their businesses yeah we're where woollies does have some initiatives shop right as well but intriguing as we tie this back to the legacy of raymond ackerman that social development social economic advancement has always been a key feature obviously 100 in fact including promoting i was reading through including promoting black managers against the wishes of the apartheid government that got him into trouble with the law i understand it did it certainly did i found that very interesting this was a guy who was taking on a whole government that was bent on saying and showing black people as incapable and he took on that personal risk if you like and business risk as well because you can well imagine he was putting his business on the line that absolutely for me really distinguished this gentleman this is a gentleman also of course by the way who's been honored all over south africa i mean i was looking through this thing here and i am seeing owners from wherever you can think of and i'm also glad to say at cnbc africa and as part of the abn group this is a man that we honored we gave him i remember a lifetime achievement award i was part of the judging panel and we were unanimous in terms of recognizing the legacy the work that he has put in and the standing of the company that he built which today stands very strong albeit at number two but a very very strong number two got you very strong number two from a retail perspective but i guess given his investment into south africa's leadership and community and even partnership with government really does speak to a heightened level of camaraderie and this takes me to an interesting question mr g so often when we take a look at leadership in south africa we bemoan the fact that there's a deficit lack of partnership lack of camaraderie lack of vision uh leadership isn't necessarily prioritizing sustainability and the social good how do you think there could be some lessons that we pick up from mr raymond ackerman that perhaps other business organizations and leaders should actually look up to well he did something about it because he built an academy that helped train people in leadership so i think that's certainly one route uh that uh all of us can follow well not that we're able to all establish academies but certainly i think we can all give back uh to society in terms of what we do i mean i look at the work that's been done by a man like yt person i speak about yt person in particular because when we talk shop right you can't separate yt person from uh shop right he built that business and i think his lessons his legacy is certainly something that we should share i know uh my colleague fifi peters has done quite some work around recognizing at the wake of yt person and she actually got recognized for it as well by the journalism fraternity yeah so i think there's more that can be done i always bemoan the fact that when you look at u.s television channels uh you look at the british it's very easy to find them talking to ceos of companies leaders within government whereas when you come to the continent it's extremely difficult for us to get access to leaders of these companies i mean i remember one time we were looking for for a conversation around governance and we're looking for the institute of directors we absolutely couldn't get any of them and yet they do come out from time to time when they want to talk about what they want to talk about what you are not getting is public engagement which would be good for the general public outside of results i'm not saying they don't do uh give us results they give us results but when we say come let's talk about the lack of leadership in ascom that we have seen nobody wants to talk about let's talk about transnet and all the struggles that we have seen throughout nobody wants to talk about and i find that absolutely a huge void exactly i've rented i'm glad you have and i'm hoping that the message has been heard by those corporates in south africa so to come out step out engage with us and give us some perspective on the critical issues impacting south africa's economy and perhaps if we could relay this to not only to relay this message to members of the business community but also relate it back to an example of who mr raymond ackerman was also reading up on some research i realized that he actually used to walk many of his customers push their trolleys to their car unpack their groceries into their boot as a sign of leadership and understanding what customers actually want a story i heard from one of my colleagues in the newsroom in fact the guy who's directing us now sean sean naeem and he was telling me the story of how this guy would know workers on the ground who worked for him we're talking people who sweep stores we're talking people who do the packing on the walls and that kind of thing he knew them by name exactly that's exactly certainly something that we need mr g this has been a delight and great working and touching with you again looking forward to learning more from you as well going forward on these journeys fantastic

Pick N Pay earlier released a statement sadly announcing the passing of Raymond Ackerman at age 92. The retail legend founded Pick n Pay from just four stores 56 years ago and turned them into one of South Africa's leading grocery chains. Today it generates 106 billion rand in annual turnover and owns more than 2,000 stores across South Africa and seven other African countries. CNBC Africa reflects on the legacy left behind by the icon. 

Pick N Pay Founder Raymond Ackerman passes away

Pick N Pay earlier released a statement sadly announcing the passing of Raymond Ackerman at age 92. 

Pick N Pay Founder Raymond Ackerman passes away

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Pick N Pay Founder Raymond Ackerman passes away

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