wealthwise may
DESCRIPTION
WealthWise magazine is South Africa's first free digital flip-page publication about wealth creation and wealth managementTRANSCRIPT
WealthWise
magazine
South Africa
May 2011
A Weaker Rand?
Vol I/No. 4
Win 10 educational CDs worth over R2000!
Details on page 53.
FREE
Access Finance
For Your Business:
Truth, Myth, Advice
Anger Management
Inside the Consumer Protection Act
www.wealthwisemag.com
C
O
N
T
E
N
T
S
On the Cover
30 Access Finance For
Your Business:
Truth, Myth, Advice
20 A Weaker Rand?
10 Anger Management
34 Inside the Consumer
Protection Act
LifeWise
9 Quick Read:
The Four Natural
Powers
14 Mindfulness is
happiness
MoneyWise
19 Quick Read: Debt
Counseling SOS
23 The Trouble with
Banking Fees
25 Tax-Free Property
Transfers
BusinessWise
29 Quick Read: Is
your business the
right one for you?
38 Maria Garcia
International - a
story of
entrepreneurship
CareerWise
41 Quick Read: What
do employees want?
42 Does your
Management Team
give 100%?
46 The Role of
Company Culture for
its Employees
Agenda
47 This month we inspire
you to...
48 Destination: Whisky Wise
54 On the bookshelf
56 Events, Workshops and
Seminars
Regulars:
3 Contents, 4 Foreword, 5 Mailbox, 6 Contributors, 53 Competition,
58 Last Word, 59 In our next issue
WealthWise 3
Finance is the central issue this May at WealthWise magazine. Having
attended various networking sessions, meetings and presentations on
entrepreneurship and the choices we face as entrepreneurs to grow a sustainable,
profitable business, it comes as no surprise that the rise of business incubators as
a one-stop shop for entrepreneurs is worth to take a look at.
We have also taken a closer look at the newly enforced Consumer Protection
Act and the steps businesses need to take to ensure compliance with the Act, the
country’s banking fees, the new regulations concerning the disposal of properties
from companies or trusts tax-free and the estimated evolution of Rand against the
main worldwide currencies in the coming months.
You’ll also find inside a special feature dedicated to cultivating mindfulness and
chasing away negativity as in the useful advice on anger management, whereas
our career section deals with employees’ needs and performance and how
important is a company culture in the first place.
Last but not least, we bring you the incredible story of Maria Garcia, a woman
whose sheer determination lead to a beauty empire, while providing hope for
women in today’s business world.
Our lifestyle section is as entertaining as ever with a different twist! This time,
we explore the magical world of whisky, its potential as a viable investment (who
knew?) and the whisky destinations well worth a visit.
We hope that our publication will inspire you to make every day, long-lasting
changes to a wealthier future.
All the best,
Denisa Oosthuizen
Managing Editor WealthWise magazine
F
O
R
E
W
O
R
D
4 WealthWise
M
A
I
L
B
O
X
Have your say! Write to us at [email protected]!
The best comments will be published in our next edition!
Each month we showcase your best comments,
feedback and suggestions for WealthWise magazine.
This is your page!
WealthWise 5
"Great material, it would have been nice to see a cost comparison,
between the different forms of intellectual property. I am sure that is
probably the first question a individual asks. But a very nice read" -
Deon Thomas, post comment on "A Guide to Intellectual
Property"
"It is truly amazing, that with our current youth. There is a greater realization
that the old work for money approach is long outdated. This fact has been proven
by several start-ups, such as Google, Groupon, Facebook etc.
In my opinion, a person's passion often transpired into something great. So for
every youngster who thinks of entrepreneurship, I would say, find you passion,
the reward may not seem transparent at the time but often pays off later. We as
human beings often want things in life, but we are not willing to go “through the
process” of achievement our goals. Having passion for something makes it much
easier to achieve your goal since you going thought the process, but having fun at
the same time. KK is a classic of someone who merely followed his passion !" -
Deon Thomas, post comment on "Young Entrepreneurs"
"Nice writing style. I look
forward to reading more in
the future" - Tom Stanley,
comment post on "Goal
Settings made easy"
"I really like this article.Yes it’s true that
self-dicipline has a big impact in
achieving one’s goal. I’ll try to put an
effort to practice on the seven traits
mentioned above.Thanks a lot" -
Comment post on "7 steps to build
self-awareness"
"Hi there, Excellent article.Explains the concept of Life Coaching very well.
Kind Regards" - Salome Banks, comment post on "Life Coaching 101"
C
O
N
T
R
I
B
U
T
O
R
S
Paul Stewart is the managing director
of Plexus Asset Management. Founded in
1995, the Plexus group of companies is
an independent financial services
provider that specialises in providing
innovative, unique and holistic financial
solutions for both corporate and
individual clients. As of 2010, Plexus
Holdings (South Africa) incorporates
Plexus Wealth Management (financial
planning) and Plexus Asset Management
(investment management services and
solutions). Read Paul's opinion about the
evolution of the Rand in our MoneyWise
section, page 20.
Shelton Kartun is a specialist in the
field of anger management and a
counsellor in stress management. Having
trained overseas and co-founded the
British Association of Anger Management,
he is the founder and director of The
Anger & Stress Management Centre of SA,
the only centre of its kind in South Africa.
He has over 20 years of experience in
anger management, conflict resolution and
stress reduction. Although based in Cape
Town, Shelton now has centres in
Johannesburg, Pretoria and Durban. His
vision is to have franchised branches all
over South Africa and Africa supporting
and empowering individuals to have
better, calmer and happier lives. Read
Shelton's article on anger management in
our LifeWise section, page 10.
6 WealthWise
Patrick Leclezio is a whiskyphile,
writer and entrepreneur, who has spent
the last 12 years working in the liquor
industry in one capacity or another. He
writes the blog Words on Whisky,
www.wordsonwhisky.wordpress.com,
and is involved in a new specialist
whisky e-tailer called WHISKYdotcoza,
www.whisky.co.za. He is passionate
about the culture, business and
enjoyment of whisky. Patrick wrote our
Whisky Wise article on the wonders and
the investment side of whisky in lifestyle
section Agenda, page 48.
WealthWise
magazine
Publisher
REO Media Solutions
Managing Editor
Denisa Oosthuizen
Contributors
Shelton Kartun, Patrick Leclezio,
Jason Holmes
Sales and Marketing
Graphic Design
REO Media Solutions
Distribution
www.wealthwisemag.co.za
www.wealthwisemag.com
Copyright
All content and information within
WealthWise publication is
property of the Publisher and
should not be reproduced, copied
or entirely quoted without the
prior approval of the Publisher,
being protected under copyright
laws.
Should you wish to make use of
any of the content displayed
please contact us at
or
The HR Hub is a unique on-line HR
Services company where clients can obtain a
number of “best of breed” HR products and
services under one roof. Read about an
opinion on management performance,
courtesy of The HR Hub, in our CareerWise
section, page 44.
WealthWise 7
Want to appear in WealthWise
magazine?
Would you like to contribute for
WealthWise magazine? We are looking
for fresh, witty and compelling content
for our magazine's sections.
If you are interested in one of this topics:
life skills, money management, business
advice, career development and wellness
(travel, lifestyle, healthy living etc),
please send your article accompanied by
a short profile of yourself and your work
and a high resolution photo (maximum
2MB) to [email protected] and
you might just see your profile article in
our publication!
Jason Holmes is a regular writer with
Debt Consolidation Care and is also a
contributory writer with other financial sites.
His expertise is woven around various aspects
of the debt industry and with his e-books
like‘Credit Score The Quintessential Therapy
for a Happy Pocket’ he tries to impart to
people the different situations and simple
solutions to get out of difficult situations.
Jason wrote a comparative article on banking
fees for our MoneyWise section, page 23.
L
I
F
E W I S E
Quick Read: The Four Natural Powers
WealthWise 9
Strangely, in today’s world, people give up their power to lead, self-express
themselves and do greater things by thinking they do not have this power in the
first place or that this power is beyond them.
In his book “The Leader Who Had No Title”, leadership expert and best-selling
author Robin Sharma acknowledges that every one of us has the power within to
become a leader. His first leadership advice? You need no title to become a leader.
Everybody can experience the power of leadership with the “Four Natural Powers”
as written in his book and quoted below:
“Natural Power #1: Every one of us alive in this moment has
the power to go to work each day and express the Absolute
Best within us. And you need no title to do that.
Natural Power #2: Every one of us alive today has the power to
inspire, influence and elevate each person we meet by the gift
of a great example. And you need no title to do that.
Natural Power #3: Every one of us alive with life can
passionately drive positive change in the face of negative
conditions. And you need no title to do that.
Natural Power #4: Every one of us alive to the truth about
leadership can treat all stakeholders with respect, appreciation,
and kindness – and in so doing raise the organization’s culture
to best of breed. And you need no title to do that” - extract from
“The Leader Who Had No Title” by Robin Sharma, pages 53-54.
The lessons to be learned here are:
• You do not need a title to be able to express your leadership capabilities.
• You do not need to be in middle or senior management to consider yourself a
leader.
• Anyone can be successful, but few choose to be.
• Success is consciously created and doesn’t happen thanks to chances, lucky
stars or your job/position.
• You have to power to show leadership, irrespective of the position you hold in
an organization, your age, your background, your place of residence.
• No one is unimportant. Every people alive today and every job available
today matters and all work can be made meaningful.
10 WealthWise
Anger
Management
by Shelton Kartun
Anger is one of our normal, natural human ‘core’ emotions and like all of our
emotions it is there to serve a purpose. The essence of our anger unfortunately can
cause immense problems as the emotion of anger is either about changing a
situation that we are not happy with or revenge. As humans play a game of tit for
tat, it is all too easy to slip into revenge mode and teach someone a lesson,
retaliate or punish and this can easily get out of control.
We need to consider our intention as to whether we are planning to be constructive
in the situation or destructive. Revenge is destructive – remember that two wrongs
don’t make a right! Turning back to the point I have made, that anger is principally
there to change something that we don’t like which has triggered us, again we
need to be careful about what we say or do, and this is what anger management is
all about. We have to stay in control, calm down and make sure we say and do the
right things that result in a constructive outcome.
Formally we can define anger management as being able to express our anger in
an appropriate way so that no-one is hurt or abused physically, verbally or
emotionally and also that no property is damaged either. More simply stated, we
are striving to prevent damage and stay in control.
Just think about it. When you cause damage, you usually have to do repairs and
often there is a price to pay. This may be the cost of replacing a plate smashed or a
cell phone thrown, but it can also mean the loss of a wife and children if she walks
out on you. That kind of price cannot be quantified.
Imagine being able to control yourself through the tools of anger management. As
a result, you don’t cause any damage and there are no repairs that have to
happen. As often said, prevention is better than cure. Therefore anger
management equals damage prevention. Anger consumes a lot of energy and can
be very damaging, plus repair can take up a lot of time and energy. By managing
your anger you will save a lot of time and energy.
Anger can be recognised by an intense feeling since once you have been triggered
and feel angry, adrenalin will surge through your body producing a fight or flight
response. Your body changes physiologically. You will sense what is going on when
WealthWise 11
LifeWise
‘It is our
behaviours
when
angry
that are
more
problematic
than
the
anger itself’
you clench your jaw, feel hot, go red, feel tense,
your heart rate goes up, you want to attack and
so on.
Some of the common triggers for anger include
not being listened to, injustices (blame,
accusations and unfairness), mistrust, disrespect,
loss of a personal goal, invasion of a personal
space or boundary, dishonesty, incompetence and
bad service. Not all triggers set all people off. It is
very individual and what may trigger one may not
trigger another. It may depend on your
upbringing, expectations, value systems,
insecurities or trust issues.
Some anger may relate to the present when you
react in the moment and soon get over what
happened, whereas some anger may carry history
that is unresolved. This tends to result in more
extreme anger or rage and the outburst is out of
proportion to what happened. A professional can
help you clear this historic anger using emotional
release processes.
Anger itself is not so much the problem but it is our behaviours when angry that
are more the problem. We have freedom of choice as to how we behave and there
are consequences for our actions. We have to stop blaming others and rather take
responsibility for our choices. Our behaviours can be appropriate such as taking
time out, ignoring, talking, negotiating, writing, speaking to a support person,
letting things go, apologising or they can be inappropriate such as shouting,
swearing, threatening, smashing things, throwing things, pushing or hitting. If you
choose the latter, there will be negative consequences. Imagine you have choices
and some belong in a good box and some in a bad box. Stop yourself in the
moment from dipping into the bad box and force yourself to rather dip into the
good box. This is anger management.
Aggression and violence are the extreme
behaviours of anger out of control (rage) and
the intention there is to teach someone a
lesson or to control them through fear and
force them to comply with what you want.
This is abusive and is in breach of the SA
Domestic Violence Act of 1998. You could find
yourself on the wrong side of the law, so take
responsibility and get help before it is too late.
Some of the basic rules of managing anger
involve using your willpower to stop yourself
immediately from saying or doing the wrong
thing, to calm down and always put time in
between the situation that triggered you, and
your reaction to it. You will always have to use
calming down strategies like taking time out,
deep breathing, going for a walk, exercise,
LifeWise
12 WealthWise
counting backwards from 50 to 1, listening to calming music and so on.
You can also use the power of your mind and self-talk yourself to calm
down, relax or let something go. Don’t sweat the small stuff as so many
fights start over silly things. Don’t provoke unnecessarily and don’t
bring up the past. Allow others their opinions and try not to take things
personally.
Financial problems often trigger anger as usually
there is a sense of a loss of control or irresponsibility
and there is a desire now to control through anger. If
there are issues such as over-spending, then it is best
to talk things through and arrive at a compromise or
solution. Explain what your concerns are and that you
are not trying to control the person. Remember that
there is usually stress associated with finances as
well and this tends to predispose anger and shorten
the fuse. The Act I mentioned above also includes
financial abuse such as withholding money from
another. Do be careful and reasonable so as not to
cross the line.
WealthWise 13
LifeWise
In relationships, know what each other’s needs
are so you can try and meet them. Accept
there will be differences based on your different
upbringings, values, beliefs and personality
types. Practice tolerance and understanding.
Communicate at all times, ideally in an
assertive rather than an aggressive manner,
stating your feelings and needs respectfully to
the other. Try not to push each other’s buttons
and most definitely use Time Out as a tool so
that you avoid arguments or fights. If you don’t
want something done to you, then don’t do it to
the other person. Learn the art of letting go,
resolving conflict, making up and doing loving
things together again. Be aware if you have got
into a negative mindset with your partner.
Change it to be positive by appreciating your
partner and think of the good things.
If you have to deal with someone else who is angry, call time out to allow them to
calm down, but if this is not possible, just realise they are probably having a bad
day and are letting off steam. Don’t take it personally and when they have said all
they needed to, you can say what you need to. Sometimes you may need to put
something in writing or involve some other person eg HR, if this happens in the
workplace.
In conclusion, anger mis-used can cause a lot of problems. Practice the ideas
suggested for good anger management and prevent damage. Anger will land up
hurting you the most and is a notorious contributor to coronary heart disease and
other health problems. Be relaxed. Be happy.
For further information, private
courses, workshops and talks, contact
Shelton Kartun, Director and Founder
of The Anger & Stress Management
Centre of SA on (021) 554 3661 or
email [email protected].
Please state where you live as this
helps us with your enquiry. Our website
is www.anger.co.za.
Defuse your anger!
Try the simple meditation breathing
technique on page 17 to calm down
when anger starts to kick in.
Deep breathing is perhaps the most
easiest way of controlling one's anger.
Repeat the exercise until anger fades
away.
14 WealthWise
Mindfulness
is
happiness
by Denisa Oosthuizen
Professor of Clinical Psychology at the University
of Oxford and Director of the Oxford Mindfulness
Centre in UK, Mark Williams co-developed the
Mindfulness Based Cognitive Therapy (MBCT)
and is the co-author of international best-seller
“The Mindful Way Through Depression”. Here
he talks about mindfulness as exposed in his latest
book, “Mindfulness: a Practical Guide to
Finding Peace in a Frantic World”.
WealthWise magazine: Your latest book “Mindfulness” is based on mindfulness
based cognitive therapy (MBCT). What is mindfulness and how is it applied in
cognitive therapies to address mental health problems?
Mark Williams: Mindfulness simply means being aware – seeing clearly what is
happening in our minds and in the world, from moment to moment, bringing a
sense of kindness to our experience rather than getting caught in judging it.
The methods used to cultivate mindfulness were first recorded over two thousand
years ago. It has long been central to wisdom traditions in Asia, particularly the
Buddhist tradition, but the art of cultivating inner silence has been a central part of
all religious traditions across the ages.
Mindfulness meditation is a secular form of this tradition that anyone can learn. It
trains us to pay deliberate attention to our experience, both external and internal.
We learn to focus on what is happening from moment to moment with full intention
and without judgement. Mindfulness is the awareness that emerges through such
training, and the skill of developing and sustaining that awareness.
Modern mindfulness-based approaches in healthcare began in the USA. From the
late 1970s, Jon Kabat-Zinn’s pioneering research into Mindfulness-Based Stress
Reduction (MBSR1) found remarkable effects on chronic pain and stress. With
colleagues John Teasdale and Zindel Segal, we have reasoned that mindfulness
training might have powerful effects in preventing future recurrence of depression,
even if taught when people were well.
To test this hypothesis, we have created the 8-week Mindfulness-Based Cognitive
therapy programme. Six research trials have evaluated the power of MBCT to
prevent depression. The results are striking. In the most seriously ill patients -
those with three or more previous episodes of depression, MBCT reduces the
recurrence rate over 12 months by 40-50% compared with the usual care, and has
LifeWise
WealthWise 15
proved to be as effective as maintenance
antidepressants in preventing new episodes of
depression.
WealthWise magazine: How is MBCT
progressing in becoming a preferred therapy of
choice and what is the perception in South
Africa?
Mark Williams: In the UK, the NHS’s National
Institute for Health and Clinical Excellence
(NICE) has recommended MBCT as a cost-
effective treatment for preventing relapse in
depression.
Other research has found that MBCT reduces
anxiety in people suffering from General
Anxiety and Bipolar Disorders, can help
enhance the quality of life and reduce the
stress in those with a diagnosis of cancer.
In South Africa, interest in the applications of
mindfulness has grown rapidly since the launch
of the Institute of Mindfulness, South Africa
(IMiSA) – www.mindfulness.org.za.
‘Mindfulness
is
“skills training”
rather
than
traditional
type
of therapy,
so
anyone
can
try it ’
WealthWise magazine: Mindfulness was proven as an effective in addressing
depression, stress, anxiety, unhappiness among others, by promoting joy and
happiness and keeping the negative feeling at bay. Can mindfulness banish these
feelings completely over time?
Mark Williams: It would be dangerous to pretend that negative emotions could be
banished from our lives altogether, but it is possible to ‘catch’ ourselves earlier, and
stop things from getting out of hand. Research studies find that those who have
learned mindfulness experience long-lasting physical and psychological stress
reduction, discover positive changes in well-being, are less likely to get stuck in
depression and exhaustion, and are better able to control addictive behaviour.
The ability to see more clearly when we are getting ‘entangled’ in our emotions is
of great benefit, and we now know that these effects are due to important changes
in the patterns in the brain following mindfulness training. Neuroscientific studies
find permanent changes in those areas of the brain associated with decision-
making, attention and empathy in people who regularly practice mindfulness
meditation. Other studies find that it increases the area of the brain linked to
regulating emotion, and that it improves people’s attention, job performance,
productivity and satisfaction.
WealthWise magazine: What would you advise people who have been faced with
depression and stress in the past?
Mark Williams: If people find that they are still haunted by past episodes of
16 WealthWise
depression and anxiety in ways that are destroying the quality of their lives even
today, then they may find that a programme of mindfulness meditation may help,
either by taking a class, or by working through the meditations in a book that
includes a CD (as in Mindfulness: a practical guide for finding peace in a
frantic world.) If they feel they need a greater focus on depression and longer
meditation guidance, then The Mindful Way Through Depression (Guilford,
2007) might help.
Mindfulness is “skills training” rather than traditional type of therapy, so anyone
can try it without feeling that they have to go over old ground, or talk through
their problems yet again. Those already in therapy report finding treatment easier
if they are more able to be mindful, and to see their thoughts and feelings with
greater distance and perspective.
WealthWise magazine: What would you
advise people who have been faced with
depression and stress in the past?
Mark Williams: If people find that they
are still haunted by past episodes of
depression and anxiety in ways that are
destroying the quality of their lives even
today, then they may find that a
programme of mindfulness meditation
may help, either by taking a class, or by
working through the meditations in a book
that includes a CD (as in Mindfulness: a
practical guide for finding peace in a
frantic world.) If they feel they need a
greater focus on depression and longer
meditation guidance, then The Mindful
Way Through Depression (Guilford, 2007)
might help.
Mindfulness is “skills training” rather than
traditional type of therapy, so anyone can
try it without feeling that they have to go
over old ground, or talk through their
problems yet again. Those already in
therapy report finding treatment easier if
they are more able to be mindful, and to
see their thoughts and feelings with
greater distance and perspective.
LifeWise
WealthWise 17
LifeWise
WealthWise magazine: Mindfulness also works
for people who are not depressed. Is there a
difference in the process itself (eg meditation
techniques) in these different scenarios?
Mark Williams: The remarkable thing about
mindfulness training is that the very same
practices that help to release us from negative
emotions also enhance positive emotions and well-
being. This is because mindfulness teaches us to
be less ‘in our heads’ and more in our bodies and
present to what is happening around us. We
become more aware of sights, sounds, tastes that
we normally take for granted, so there comes a
sense of reconnecting with life, and reclaiming a
way of living that expresses our deepest values,
rather than postponing peace and happiness for
another day.
WealthWise magazine: Where can we practice
mindfulness – can you recommend places or
groups where this is practiced in South Africa (and
internationally)?
Mark Williams: I would advise people to get in
touch with the Institute of Mindfulness, South
Africa – www.mindfulness.org.za. Anyone can
access our own work in Oxford through
www.oxfordmindfulness.org and through this, find
links to mindfulness teachers throughout the world.
For more information on Prof. Mark Williams and
his work on Mindfulness, visit
www.mindfulness.org.za and
www.oxfordmindfulness.org.
Mindfulness-Based
Cognitive Therapy (MBCT)
revolves around
mindfulness meditation
which takes just a few
minutes a day for the full
benefits to be revealed.
Read more about MBCT in
Mark Williams' book
"Mindfulness - a practical
guide to Finding Peace in a
Frantic World", reviewed
on page 55.
Meditation 101 - Don't know where to start?
Try deep breathing!
First lesson in meditation: learning how to control your breathing! Various studies
show that deep breathing does wonders for your mind and body, lowering your
blood pressure and stress levels. Try this simple breathing exercises to kick-start
your meditation:
Step 1. Close your eyes and relax your body (especially neck and
shoulders).
Step 2: Inhale through your nose (and expand your abdomen) while
counting to five.
Step 3: Hold your breath for a couple of seconds.
Step 4. Exhale through your mouth while counting to five.
Step 5. Repeat!
M
O
N
E
Y W I S E
Quick Read: Debt Counseling SOS
WealthWise 19
We have uncovered the answers to questions regarding debt counseling!
Do I qualify for debt counseling? Debt counseling assists over-indebted
consumers who can no longer afford their monthly payments and are being
threatened with imminent legal action. If you can, but choose not to pay (read:
dodge or escape) your debts, debt counseling is not appropriate.
I can’t pay my creditors. Should I go straight for debt counseling? No. Debt
counseling provides assistance for over-indebted and helps renegotiating monthly
payments and terms with the creditors, such as repaying debts over a longer period
of time. To avoid unpleasant consequences though (see further below), try
beforehand to negotiate directly with the creditors. As a matter of fact, negotiating
with creditors is a debt counselor’s main focus. The only difference is that it provides
a temporary protection for creditors, although this is a temporary protection of 60
days in order to give you enough time to renegotiate credit facilities. After this
period, you are again exposed to legal action and repossession if the debt is not
settled with the creditors.
What would happen if I do not settle the debt? As previously stated, you could
lose your possessions (home, car and so on) and face legal action. To avoid this, all
debts must be settled. Failure to do so means losing the protection awarded under
the National Credit Act while under debt counseling, resulting in legal action from
the credit providers. Note that the creditors have the right to pursue legal action
while under debt counseling! Debt counseling is not about permanent protection
from creditors or absolving the applicants from all payments.
Are there any drawbacks I should be aware of? Yes. There are consequences to
debt counseling application and this is why it should only be considered as a last
resort. Negotiate with your creditors firsthand and let them down you are
experiencing difficulties with repayments – you might even avoid going to debt
counseling in the first place. If you choose to go for debt counseling, you will be
credit blacklisted for five years (you won’t be able to apply for more credit) and you
won’t be able to incur further debt as your name will be flagged at the credit bureau.
Also, you will have to pay the debt counselor and stick to the terms of repayment
arranged and agreed by the debt counselor, otherwise you would risk legal action
and repossession. This is not all, however. In certain cases, being credit blacklisted
might hinder you to apply or get certain jobs, plus if you are married in community
of property, your spouse will have to suffer the same consequences as you. Ouch!
20 WealthWise
A Weaker RAND?
When will the Rand weaken - and against what?
article by Plexus Asset Management
A currency’s value at any point in time is the equilibrium or market clearing price
at which buyers or sellers of the currency will participate in the market. Ultimately
the direction in which a currency trends is a function of aggregate demand and
aggregate supply of the currency versus other currencies. So says Paul Stewart,
managing director of Plexus Asset Management.
“The demand for currencies is largely affected by exports, imports, service
payments, portfolio investments, domestic fixed investment, foreign fixed
investment and speculation on future expectations", says Stewart.
Based on these factors, how is the SA rand likely to perform in the foreseeable
future? “As a general observation, the SA rand is overwhelmingly viewed as
overvalued at present and that a sharp devaluation is imminent", says Stewart. “In
fact, many respected commentators have publicly stated their view that investors
should currently accumulate foreign currency exposure, in anticipation of a great
unwinding of the rand’s value".
“South African investors typically think of the rand’s relative value to the US dollar,
euro, British pound and perhaps the Japanese yen. They seldom consider the rand
in relation to the Australian dollar, Canadian dollar, Brazilian real or Chinese yuan”,
he adds.
According to Stewart, the expectation for a devaluation of the rand relative to the
USA, Eurozone and UK currencies may be misplaced.“The developed world is
emerging from the global financial crisis and countries are currently debt-laden.
Exceptionally high historic debt to GDP ratios, added to high unemployment rates,
imply that robust growth will not return to these regions soon".
“In fact, very accommodative monetary policy (low short-term interest rates) and
aggressive fiscal policy (massive upscaling of the government balance sheet) have
been the selected policy tools adopted by the authorities to engender growth and
restore confidence in these economic powerhouses.”
Also, Stewart belives that the unmarked footnote to these policies’ decisions is that
massive stimulus and low interest rates have a cost – they will ultimately weaken
their home currencies.
“This is not something politicians will readily acknowledge in the mainstream policy
announcements. A depreciating currency ultimately means the gradual erosion of
the purchasing power of their citizens. But currency devaluation is a recognised and
tolerable policy choice given the economic challenges that face these regions”,
explains Stewart.
MoneyWise
‘The
South African
Rand
is
overwhelmingly
viewed
as
overvalued’
WealthWise 21
“My conclusion is that given a secular period of
poor developed market economic conditions,
South Africa will look good on a relative basis to
these economies for the foreseeable future.
South Africa has its problems and they are well
documented, but its debt levels are lower, its
growth rates will be higher and its commodities
will continue to command a premium price in the
world of a weak US dollar”, adds the Plexus Asset
Management representative.
“My view is that the rand will continue to
‘surprise’ the market in how robust it is relative
to the dollar, euro and British pound. Of course
this does not preclude short, sharp periods of risk
aversion when the rand may experience periodic
jitters – such as during September 2008 and
January 2011 – only to retrace its footsteps once
calm returns. I would not be at all surprised to see the rand remain at these
levels, or perhaps even trend stronger against these majors, in the next three
years".
“Conversely, many emerging markets (BRICM) and commodity strong economies
such as Australia and Canada do not have these extreme debt concerns coupled
with slow growth. Emerging markets specifically have good population
demographics, improving government finances, high levels of net foreign reserves
and the added boost of sitting on either large commodity pools or extremely
competitive labour forces – or both”, he says.
“The fundamentals and outlook for such countries in terms of their currencies are
actually very good. Expect these currencies to outperform in the future”.
On a relative competitiveness basis, Stewart believes the South African rand could
well see devaluation against this emerging market currency basket in the future as
it has in the last few years (see the table on page 22).
“Either way, the idea of currency diversification needs to be seriously reconsidered
in this new world. Non-South African exposure for diversification reasons needs to
much more carefully considered. A higher emerging market currency exposure,
especially to the best quality emerging markets, should be a core part of one’s
investment policy".
Paul Stewart is the managing director of Plexus Asset Management. He can be
contacted at 021 970 2400 or by email at [email protected].
Founded in 1995, the Plexus group of companies is an independent financial
services provider that specialises in providing innovative, unique and holistic
financial solutions for both corporate and individual clients. As of 2010, Plexus
Holdings (South Africa) incorporates Plexus Wealth Management (financial
planning) and Plexus Asset Management (investment management services and
solutions). For more information, visit www.plexus.co.za.
Note: *Green areas denote rand appreciation, red areas denote
rand depreciation
South African Rand (ZAR) depreciation against other
major currencies to 31 March 2011
ZARUSD
ZAREUR
ZARGBP ZARSGD
1 Month
3.1% 0.4% 4.4% 2.0%
3 Months
-2.0% -7.7% -4.9% -3.9%
6 Months
3.0% -1.1% 0.8% -1.4%
1 Year
8.0% 2.7% 1.9% -3.1%
2 Years p.a 19.1% 14.8% 12.4% 8.2%
3 Years p.a 6.2% 10.1% 13.9% 3.2%
5 Years p.a
-1.9% -4.9% -0.4% -6.6%
10 Years p.a 1.7% -3.0% 0.5% -1.9%
USD = American Dollar
EUR = Euro
GBP = British Pound
SGD = Singapore Dollar
BRL = Brazil Real
CAD = Canadian Dollar
AUD = Australian Dollar
CNY = Chinese Yen
p.a = per annum
ZARBRL
ZARCAD
ZARAUD
ZARCNY
1 Month
1.1% 2.7% 1.3% -2.7%
3 Months
-3.9% -5.0% -3.2% 2.9%
6 Months
-1.1% -3.3% -4.4% -0.8%
1 Year
-1.3% 2.7% -4.6% -3.4%
2 Years p.a -0.1% 4.3% -2.8% -14.1%
3 Years p.a 3.9% 4.4% 2.1% -3.6%
5 Years p.a
-7.5% -5.3% -8.8% 6.2%
10 Years p.a -1.1% -3.1% -5.7% 0.6%
22 WealthWise
MoneyWise
The Trouble with
Banking Fees
Debt resulting from bank fees
on opening a bank account
or credit card
by Jason Holmes
Most people are not aware of the fees that they will be required to pay if they go
for opening a bank account, may be checking or savings or getting a new credit
card. There are in fact various kinds of fees like the processing fee, additional
service fees, SMS banking fees, annual fees, communication fees, net banking fees
and fees for withdrawals more than a certain amount and so on.
Fees in South African Banks
The banks in South Africa charge fees and offer privileges for opening various
accounts and they have various criteria for opening an account. Two of the biggest
banks of South Africa are Amalgamated Banks of South Africa (ABSA) and
Standard Bank of South Africa. The official currency of South Africa is the Rand
(sign: R). If we take the case of ABSA, for the various types of savings accounts
they offer, the monthly fees varies from R0.00 to R15.00 ( depending on the
minimum amount you have in your account). For opening different types of cheque
accounts, the criteria will be your minimum monthly income. Monthly internet
banking subscription for both savings and cheque accounts will be around R21.95.
On the other hand, opening a savings account in Standard Bank, monthly fee can
vary from R0.00 to R15.00. For opening a cheque account, no criteria are
applicable. The monthly internet banking subscription for savings and cheque
accounts are R22.00 and R0.00 respectively.
These are examples for just these two banks from South Africa. For others, the
various fees and privileges are different. To reiterate, doing online research helps in
a big way to avoid any additional and unwanted bank fees and manage your bank
accounts in a proper fashion.
Fees of some of the biggest banks in America
By comparison, let’s look at the major banks in America. The Americans are not at
all thrilled with the way the banks are slapping fees onto them for opening such
bank accounts, or credit cards. Most of the consumers look for other banks that
offer free checking accounts and lesser fees for getting a new credit card. Many run
up debts as a result of these fees and so if you have high debt amount as a result
of this, you can send debt consolidation letters to the banks for lowering your debt
amounts.
WealthWise 23
MoneyWise
‘Doing
online
research
helps
avoiding
additional
and
unwanted
banking fees’
The fees charged by some of the biggest banks
for the maintaining bank accounts like checking
accounts are like Bank of America charges $6 to
$25 on checking accounts on monthly fees.
In case you do net banking, you will be charged
$8.95. Again, you will be charged different fees
for different kinds of accounts with different
privileges.
In case of Chase, you are required to pay a $6
monthly fee if you are not able to make five
debit card purchases or at least one direct
deposit of $500 at the least every month.
Wells Fargo and Citi too charges monthly
maintenance fee. Thus, you need to be aware of
all of these charges before you take out another
credit card or open another account with any of
these or other banks.
In case you already have an account with any of the banks, and if you have run up
huge debts, you can try to settle the debt in order to lower the outstanding debt
amount. For that, you will have to send debt settlement letters to the creditors
through certified mail requesting a return receipt.
However, according to the president of Independent Community Bankers of
America, "Right now, the majority if not all of the community banks are offering
free checking". So, you can find out for your own benefit the bank that is offering a
free checking account.
Avoiding the additional bank fees
Some of the things that you can do in order to avoid the additional and the
unwanted bank fees are:
1. Doing online research – You need to do some online researches in order to
find out the different bank charges on different accounts. As discussed above,
different banks charge different fees.
2. Switching accounts with banks – If you already have an account with a
bank and if you find out that the bank is charging you higher fees than other
banks, you can switch banks.
3. Setting up overdraft protection – If you think that overdrawing is almost
unavoidable for you, then you can set up overdraft protection.
Jason Holmes is a regular writer with Debt Consolidation Care and is also a
contributory writer with other financial sites. For more information, visit
www.debtconsolidationcare.com.
24 WealthWise
MoneyWise
Tax-free
Property
Transfers
out of companies, close
corporations or trusts
In our previous March issue of WealthWise magazine, we have discussed the basic
requirements of the Tax Voluntary Disclosure Programme, which allows taxpayers
to regularize their tax affairs without having to incur penalties and interest for
previous non-compliance.
There is a similar facility offered to homeowners who hold their residence in a close
corporation, company or trusts and wish to take their private residence out of their
company or trust without paying transfer duty fees or capital gains tax (CGT).
In 2002, this opportunity was open to persons and special trusts only. February
2009 to September 2010 was another good chance for taxpayers to dispose of their
residence from a company or trust, especially under then tax laws which made this
move quite expensive.
From November 2010, the Taxation Laws Amendment Act has imposed new
condition for property transfers out of companies and trusts.
According to Robert Jewell, co-owner of Accounting for Entrepreneurs (A4E) and
Chartered Accountant with a special interest in tax, the following are applicable
with regards to the present tax relief in the case of property disposals out of
companies or trusts, which came into effect on the first of October 2010 and
applies to all residences disposed of on the date or after:
� The closing date to apply for the property disposal our of a company or trust
is 31 December 2011
� If the home is in a CC, company or trust, one can transfer it out of the CC,
company or trust tax free if certain conditions are met
� The property must be the owner’s home
Why hold a residence in a company or trust?
Usually, taxpayers choose to hold a residence in a company (including close
corporations) or a trust to obtain benefit on transfer and estate duties.
The advantages for holding the property in a trust or company include the
protection of the property from creditors if held in a trust. This protection is lost
when the property is transferred in the owner’s own name.
WealthWise 25
MoneyWise
Why transfer the property into your own name?
Advantages of transferring the property into your name include:
� Less Capital Gains Tax when an individual sells the property. The first R1.5
million of the capital gain is exempt from tax
� No accounting and audit fees
What are the requirements for the tax relief?
The residence refers to any structure that is used as a place of residence by the
owner, be it a household or a mobile home, such as caravans. Any other asset that
is not used for residence (a car, for example) does not qualify for tax relief. Vacant
land is not a residence in itself and does not qualify.
The date of disposal must occur between 1 October 2010 and 31 December 2012.
Note that the date of registration and application is different from the actual date
of disposal! This inclusion will determine if the tax relief applies under the new
regulations.
If the disposal occurred between 11 February 2009 and 30 September 2010, it
could qualify for the present tax relief under certain conditions that could have
been only fulfilled after October 2010 (example: the sale was concluded before
September 2010, but a mortgage loan, subject of the agreement, was secured
only after October 2010).
The residence disposed of must be mainly used for domestic purposes by
persons who are in relations with the company or trusts, eg. as in shareholders
of the company or beneficiaries of the trust. These persons must reside in the
residence to qualify for the tax relief.
Non-domestic use of the residence may include using a residence for business
purposes (home office) or renting it to another person. Note that more than half
of the floor area of the residence must be used for domestic purposes to qualify.
In the case of holiday homes, this can be exempt of tax only if the owner can
prove to the South African Revenue Service (SARS) that the holiday home is
used mainly for domestic purposes.
26 WealthWise
Need more information on the property
transfers out of companies and trusts?
Seeeking professional advice before
making any decision?
For further information, guidance or
assistance, please call Robert Jewell,
Partner at Accounting For Entrepreneurs
(A4E) and CEO Jewell & Co Registered
Accountants and Auditors at 0861 000 a4e
(243) if you're in South Africa and +27 12
460 1032 if you're abroad, or email at
For Robert's upcoming tax presentation
in May, please see our events list on
pages 56-57.
The most important new regulation specifies that the company or trust must
terminate its existence within six months of the disposal of the residence in order
to qualify for the tax exemptions. This means that the company or trust must
initiate the steps towards liquidation and deregistration within the six months
provided and no necessarily be terminated in that specific period.
There are no requirements regarding the disposal of the residence to a specific
person to qualify for the tax relief. However, the aforementioned points stipulate
that disposals to unrelated third parties do not qualify.
What relief do I get?
• Transfer duty.The purchaser of the residence is not liable to pay transfer
duty.
• Capital gains tax (CGT). No capital gain or loss is due on disposal. This is
valid for the disposal of the residence only; any other disposed assets prior to
termination are subject to CGT.
• Added value tax and donations tax. There are no specific reliefs, normal
rules apply.
• Secondary Tax on Companies (STC) - tax on dividends declared by
companies that are resident in South Africa and imposed on companies or close
corporations and not on shareholders (more info at www.sars.gov.za).
Normal STC regulations apply if thwe residence is disposed of by the company and
the profits resulted are distributed between shareholders as cash dividends. Any
other assets disposed of until termination is subject to STC. If the residence is sold
to a shareholder at less than the market value, normal STC regulations apply. For
more information, ask your financial and tax advisor.
• Dividends tax. The procedures as similar as in with STC (not yet effective).
WealthWise 27
MoneyWise
B
U
S
I
N
E
S
S W I S E
Quick Read: Is your business the right one for you?
WealthWise 29
You have decided to become an entrepreneur - now what’s next? Deciding on the
right business to start with is not a daunting task – that is, if you ask yourself
these questions:
What is my passion? Identify your passions, hobbies and pleasurable things to
do and look at how you can monetize them.
What am I good at? Take a look at your previous work and accomplishments
during your employee years. Could you incorporate a similar work and similar skills
in a product or service to others, at a charge? If so, proceed to offer your services.
What business model I would like to know more about? There’s no need to
re-invent the wheel every time. If you are interested in a franchise or a business
you have no knowledge about, learn from entrepreneurs and business owners with
similar companies. Read as much as you can, learn from their actions and dare to
follow the same path they have followed.
Am I a problem-solver? If you are creative, innovative and love risks, you could
start a business catering for a niche market with a product or service that solves or
covers a need in the market. Make sure you understand the market before
proceeding though.
Can I provide a value-add service? People want products and services that add
value to their lives, whether enhancing their customer experience, saving costs and
money or make them successful. Think of ways of providing value-added services
that would benefit people. Replace “sell” with “serve” in your long-term thinking.
Do I have a target audience? Determine your target market and assess if this is
the right audience for your business and if the business can be catered to address
the needs of the particular audience.
Is the business matching my desired lifestyle? Choose a business model you
are happy with, whether it is a home-base business you are after or a national
growing empire. Make sure you know what you want in the end.
30 WealthWise
Access Finance
for Your Business:
Truth, Myth and Advice
by Denisa Oosthuizen
There comes a time in the life of
an entrepreneur when the “finance”
card comes into play. If the
entrepreneur’s ultimate goal is to
build and grow a profitable business
and finance is the much needed
boost, then why so many
entrepreneurs find it so hard to
access finance for their businesses?
At a recent business exposition
organized by the National Small
Business Chamber (NSBC) in
Johannesburg, four experts
representing business incubators,
financial institutions and
organizations whose mission is to
support entrepreneurs answered
the questions “Why so many
entrepreneurs fail to access
finance?” and “How can they
prepare in order to secure a positive
answer?”. Below you’ll find their
surprising comments and advice.
Is finance what your business needs right now?
Generally speaking, financing a fledging business can either come in the form of
equity finance o debt finance. While the first choice might seem to approach a
commercial bank, today’s entrepreneurs have a variety of options to boost their
businesses. Securing finance alone is not enough anymore – entrepreneurs seem to
look out for wholesome guidance, help and support and learn from other
entrepreneurs’ lessons. Belonging to an “entrepreneurship networking community”
and benefiting from these array of services specifically catered to grow a business,
holistically and profitably, is what business incubators do.
Business incubators might require an equity stake in the business they incubate
and support or a monthly fee. In some cases, they offer additional service such as
office space, technical support and accounting and can even open doors to venture
capital or angel investors. While business incubators are not the ideal place to ask
for finance, their focus on business growth, long-term sustainability and
profitability is not to be overlooked.
The truth about business incubators is that they really work once the incubated
business is already geared for growth. Rather than focusing on launching
businesses, incubators provide assistance to entrepreneurs whose businesses have
a track record, but need the “magic touch” to go forward – mentorship, training,
support, including the “open doors” to investors.
It is of utmost importance then that the entrepreneur should decide on what would
benefit his/her business in the first place, be it a strategy, capital, the incubation –
networking and support – or all of these combined. Know yourself first and only
then an incubator can help you reach your wildest goals.
WealthWise 31
BusinessWise
Willie Nortier, Regional General
Manager, Business Partners Ltd
(www.businesspartners.co.za)
Business Partners Limited is a specialist risk
finance company for formal small and medium
enterprises (SMEs) in South Africa and selected
African countries, providing financing, specialist
sector knowledge, mentorship and added-value
services for viable small and medium businesses.
• Don’t limit yourself to commercial banks when seeking finance for
your business. There are business incubators and venture capitalists
willing to support your business and enable it to grow
• Entrepreneurs must realize that we don’t finance the business plan,
we finance the entrepreneur behind the business
• Entrepreneurs must show that they understand the risks involved in
the business too and prepare worst case scenarios
• Most importantly, be realistic
• Emphasize your track record and show how this can work in your
future for your business
Pavlo Phitidis, CEO Aurik
(www.aurik.co.za)
Aurik is a business incubator for SMEs, enabling
business growth and acceleration by providing
assistance and consulting for entrepreneurs,
outsourced back-office services and various linkages
programmes among members of its community of
entrepreneurs.
• Treat the financiers as you would treat your customers
• Establish and know your underlying internal risks for your business
and built proper systems in place
• Most importantly, consider your business life cycle. Look at where
you are now and match the business’ current life cycle with the right
funding:
� Equity funding is ideal for start-ups
� Bank finance is more suitable in the growth phase of the business
• Do a proper planning. Entrepreneurs should not overlook a sound
business plan and you do not need tens of pages for that. Even five pages
are enough, providing that they contain real insights into the business,
cashflow spreadsheet and how the business will benefit from the finance
(where the investment is going to).
BusinessWise
32 WealthWise
Thabo Ntseare , CRO (Risk Manager)
Royal Fields Finance
(www.royalfields.co.za)
Royal Fields Finance (RFF) is a 100% Black owned
company that was established to ease liquidity
problems faced by black owned businesses in South
Africa. RFF provides debt funding to Small and
Medium Enterprises (SMEs) that are unable to
access bank or Development Finance Institution
(DFI) capital.
• Focus on cashflow:
� Is the business generating enough cashflow to pay back the loan?
� If something happens to the cashflow, will the financiers be covered?
� Do you have security? Collateral?
• Think of new ideas to generate cashflow for your business
Fred Robertson, member of Masisizane Board,
Old Mutual Masisizane (www.oldmutual.co.za)
Old Mutual Masisizane a leading development finance
institution in South, enabling sustainable development of a
large number of SMMEs, encouraging entrepreneurship,
facilitating job creation, increased financial and business
skills that in turn translates into significant social benefits to
communities in the form of wealth creation, sustainable
home-building, access to education, and re-investment into
the economy.
• Prepare yourself. Consider training to gain knowledge and lay a
solid foundation for your business
• Fine-tune your thinking
• Do some self-analysis. Look into yourself and find out the things you
are passionate about. We do not have a shortage of money for
entrepreneurs and SMEs in the country. The real challenge is unlocking
the people’s passion.
• Pitch to the right people
• Build a track record – start small and grow your capabilities towards
what you want to achieve
• You might need to go back to the drawing board. Sometimes
financiers will encourage you to go back and revise your business plan,
projections etc. This might sound discouraging at first, however this does
not mean a closing door – learn, grow and never give up your dream
‘We don’t
finance
the
business
plan,
we finance
the
entrepreneur
behind
the business’
BusinessWise
WealthWise 33
Photo credits: centurionet.co.za,
aurik.co.za,
In need of a boost for your business?
Raizcorp (www.raizcorp.com) is a business incubator for entrepreneurs with an
eight-step selection, including interviews. The Partner model offers mentorship,
courses, networking via its vibrant community of over 200 entrepreneurs, plus
office space and the logistics that go with it. The business must be operational, but
not necessarily profitable.
Aurik (www.aurik.co.za) is a business incubator for entrepreneurs offering
various programmes, networking, outsourced services and help with funding
proposals. The business must be operational for minimum one year on a full-time
entrepreneurship base.
Branson Centre (www.bransoncentre.org/SouthAfrica) supports running
businesses with a potential for growth, offering various services for its members,
networking, weekly workshops, mentorship and help with potential financiers and
investors. Every applicant is interviewed.
Bandwidth Barn (www.bandwidthbarn.org) showcases five different
programmes, funded by provincial government (Cape Town area) for
entrepreneurs, based on their needs and stage of development. The incubator
caters for start-ups and businesses in media, IT and design industries. A monthly
rent needs to be paid.
Step Strategic Venturing (www.step.co.za) offers networking, access to
services and office space, mentorship and support for entrepreneurs. The business
must be already operational and a monthly rent needs to be paid.
TIP: The selection process is not based only on the business idea itself and the
business plan. Personality, drive, commitment and affinity with the existing
entrepreneurship community is more important.
34 WealthWise
Over the past few months, the Consumer Protection Act, effective from 31 March
2011 (postponed until the end of May 2011) has been the hottest topic any
business agenda. The attention the new Act receives in the business world has a
good reason – companies that fail to comply in terms of the Act are liable for a
penalty of R1 million or 10% of their annual turnover – whichever is greater.
There have been numerous workshops, seminars, meetings, presentations, articles
in media surrounding the impact the new Act would have over businesses operating
in the country. WealthWise magazine recaps the most important points and
provides advice on how to get started in understanding, implementing and
complying with the Act.
Step 1: Understand that customer protection is paramount
The first step in complying with the Act is to understand the necessity and aims of
a valid framework for consumer protection. The Consumer Protection Act (CPA)
was introduced for the mainly following reasons:
• Establish national standards and norms as the framework in order to address
consumer protection
• Promote responsible consumer behaviour, fair marketing and business
practices
• Promote a fair, accessible and sustainable marketplace
• Improve standards in consumer information
• Protect disadvantaged consumer in terms of their area of residence, literacy
and income levels
• Establish the National Consumer Commission, the organ of state responsible
with issuing compliance orders, initiating systematic investigations over consumer
protection compliance and examining consumer complaints
The CPA covers every transaction occurring within the Republic, from promotion to
marketing, labeling, displaying, delivering and selling goods and services to the
consumer at large, herein referred as the beneficiary of services and users of the
goods or services marketed to them.
Step 2: Determine if the provision of the Act applies to your
business
As stipulated in the National Consumer Commission’s guide, the Act is not
applicable in respect of certain situations. We are mentioning some of these below,
however we strongly recommend the Act consultation for a comprehensive
approach:
Inside the Consumer Protection Act
by Denisa Oosthuizen
WealthWise 35
BusinessWise
• Goods or services promoted or supplied to the state
• Credit agreements in terms of the National Credit Act (but not goods or
services)
• Services under employment contracts
The CPA has a direct impact in a variety of industries, from manufacturing to
retailing and direct marketing/selling, therefore make sure you understand how it
impact your business. Note that the Act does not cover the transaction between
businesses where the business receiving the goods or services has a turnover of
value in assets of R3 million. Therefore, small business are scrutinized, both as a
supplier and a consumer.
Step 3: Determine which areas of the Act affect your business
The Act requires businesses to come forward and be transparent about their
practices. Knowing which areas of your business or which departments comply with
the Act and which need to be adjusted to accommodate the Act is absolutely
necessary. Companies across the supply chain – manufacturers, importers,
distributors and retailers are all liable and there is no such thing anymore as
passing the blame. The next step will help you better identify these areas.
Step 4. Conduct a business audit to determine the business’s
compliance needs
Look at the following guidelines for a thoroughly compliance audit:
• The Act requirements in the demarked areas
• The consumer rights – are these all covered by your business?
• The current compliance situation in the business
• Pitfalls and problems areas that need to be addressed
• Actions that need to be taken
• Responsibilities inside the organization around compliance
• Verification procedures and deadlines
BusinessWise
36 WealthWise
Businesses should conduct business according to the consumer rights covered by
the Act:
• Right to Equality and protection against discriminatory marketing -
consumers must be all treated equally; suppliers must not limit access to goods
and services, prioritize a consumer group above other, vary the quality of products,
charge unfair prices in a discriminatory manner
• Right to Privacy – consumers have the right to protect their privacy and
confidentiality, refusing unwanted text messages, telephone calls, letters, spam
email or unsolicited correspondence; suppliers must cease to continue any
unsolicited direct marketing (via email, post or SMS) if consumers have not opted
for the correspondence, provide consumers with an un-subscribe option in the
marketing correspondence
• Right to Choose – consumers have the right to shop around, cancel or
renew a fixed-term agreement upon expiry of the contract without penalty or
charge within 20 days notice, request written cost estimates and quotations prior
to services executions, cancel direct marketing agreements within a 5 day period
without reason and any advance reservations, bookings or orders, examine and
reject goods even after purchase, return unsafe or defective goods with full refund,
return or retain unsolicited goods after a 20 days period; suppliers are not
permitted to force consumers into entering additional agreements with suppliers
(bundling offers) and charge consumers for quotations, must extend fixed-term
agreements on a monthly basis only, are required to include a “cooling- off period”
of five days in direct marketing, return payments received by unhappy customers
within 15 business days of the cancelation, request a reasonable cancellation
penalty or advance booking fee, charge consumer for loss and damage resulted
from deliberate actions
• Right to Disclosure of Information – consumers have the right to demand
information in plain and understandable language, request the unit cost of goods
and services to avoid hidden costs, demand the payment of the lower price if the
goods display two different prices, demand the confirmation of purchases made
(receipts or invoices), demand identification for deliverers, installers and others;
suppliers must display the price of goods and services in full view, specify the
duration of promotions in their correspondence, display labeling, trade conditions,
country of origin and disclose any genetically modified ingredients
• Right to Fair and Responsible Marketing – consumers have the right to
protect themselves against bait marketing, negative option marketing, direct
marketing, catalogue marketing, trade coupons and similar promotions; suppliers
are not permitted to mislead consumers in terms of pricing, nature, properties,
uses and benefits of goods and services advertised, automatically enter consumers
into agreements for the supply of unsolicited goods, solicit payments for unsolicited
goods, make promotional offers and not fulfill them. Suppliers must inform
consumers of the rights of cancelling direct marketing agreements within 5
business days, honour agreements in respect with the availability of the goods
(limited offers) and disclose details related to catalogue marketing products (where
the consumer cannot inspect goods prior to delivery)
BusinessWise
WealthWise 37
• Right to Fair and Honest Dealings – consumers have the right protect
themselves against unethical and improper conduct, false, misleading or deceptive
representations, fraudulent scheme and offers, pyramid schemes, over-selling and
over-booking. Suppliers are not permitted to harass, pressure, influence, coerce
consumers when marketing and supplying goods and services, provide customers
with false information, engage in fraudulent and unlawful financial transactions,
promote fraudulent schemes and scams, accept payment for non-provident
services or goods
• Right to Fair, Just and Reasonable Terms and Conditions (Ts&Cs) –
consumers have the right to protect against unfair, unreasonable, unjust Ts & Cs,
to obtain notice for certain terms and conditions, to obtain free copies of
agreements and contracts, to refuse prohibited transactions, to approach the
Court to ensure fair conduct; suppliers are not permitted to market, supply and
enter unfair and unreasonable agreements. Supplies must keep records of any
transaction entered over telephone if agreements are not in writing
• Right to Fair Value, Good Quality and Safety – consumers have the right
to demand good quality service, receive timely and high quality services, imply
warranty of quality for goods and services and on repaired goods, receive
warnings on the facts and nature of risks, claim damages for injuries caused by
unsafe and defective goods and return goods without penalties within 6 months
after delivery if goods are found unsafe, defective or of inferior quality; suppliers
must remedy any defects or refund the consumers within a 3 months period after
repairs have been done, warrant that the goods comply with the requirements and
standards of being safe, of good quality and durable, make consumers aware of
any risks and hazards and provide clear instructions and warnings
• Right to Accountability from Suppliers – consumers have the right to
protection when entering lay-bye agreements and with regard to prepaid
certificates, credits and vouchers; suppliers must supply equivalent or superior
products if failed to deliver goods and services via lay-bye agreements and treat
customer’s property with care if in possession of prepaid certificates, credits,
vouchers, assuming liability for any losses suffered by consumers in this regard.
Need more info?
Please contact the Department of Trade
and Industry (dti) Consumer Help
Line/Customer Contact Centre at 0861
843 384, thr dti Office of Consumer
Protection (OCP) at 012 394
1436/1558/1076 or email
[email protected]. Visit
www.thedti.gov.za for details.
Need to complain?
Call the National Consumer Tribunal
(NCT) at 012 663 5615, email
[email protected] or visit the
website www.thenct.org.za.
38 WealthWise
Maria Garcia
International
A story of entrepreneurship
The face, founder and intuition behind South Africa’s best kept secret, has been
staging our nation for the last thirty seven years with pride on the global stage,
daring to compete and yet successfully doing so, placing her foray of beauty
products next to the leading industry multi-nationals, in the forefront of skincare
technologies on the global stage.
From humble beginnings, being born into poverty, Maria was often teased as being
“The Portuguese Peasant”. This discrimination and her being exposed to poverty,
as well as losing her mom at the tender age of seven, fuelled her with the inner
strength that she would grow to understand only in her later years in life.
Maria found solace and shelter at Nazareth House in Cape Town. Brought up by the
nuns, she still felt lost without her mom. She would spend her youth playing in the
fields. Rather than frolicking with dolls, Maria found comfort picking up flowers.
This is when she felt closest to her late-mother, and although she did not realize it
at the time, these were the days that were making Maria attuned to the essence of
beauty.
When Maria’s father brought together his children from the orphanage and moved
them to Namibia, he would collect all the old fruit from the Portuguese fruit corner
shops. When bringing them home, he would try and find the good pieces amongst
the rotten and give the clean fruit to his children to eat. The fermented pieces
were then placed in a large wooden barrel, which he would make fermented
alcohol from.
Maria would pinch some of his alcohol, as well as steal flowers from the
neighbour’s gardens. She would mix the two together and the result was her very
first fragrance which she called ‘Number 57’. Number 57 was the number of the
house that her father had rented and today still features a prominent place in
Maria’s bespoke fragrance library. She would sell her then homemade concoctions,
Maria Garcia has no formal CV, no university
degrees, diplomas or school certificates; instead
she tells a story, one that has set the benchmark
for fellow aspiring entrepreneurs and people from
all walks of life. This is her story, a story of
unrelenting determination, strength and one of
hope, justice and success. Maria Garcia inspires
people to dream beyond the narrow ideas of what
society dictates, to be tenacious, audacious and
daring.
WealthWise 39
BusinessWise
packaged in purity bottles to friends and passersby. The income she received was
given to her father to help contribute to the household. And so her journey which
would see her become a leading entrepreneur in the world of beauty and fragrance
began.
Maria first became notorious in the beauty field, launching international brands
and her first brand is now recognized as one of the top ten ‘Big Boys’ in the world
today. The second skin care line she created, which catered to the needs of the
darker skin tones was also sold to a different multi-national.
Maria Garcia International™ was born in 1986. Maria set her sights on the world
and today her quintessential line of skin care, grooming and bespoke fragrance
libraries can be found in countries all over the globe, with offices as far as San
Diego, USA. Her sink side luxurious range of guest amenities has checked into
some of the most renowned hotels, resorts and lodges on the planet.
Maria’s success has not come without pain, tears and lonely nights. Her road to
success has been burdened with headaches, stress and let downs. For example, in
2009 Maria Garcia International™ had hit rock bottom in South Africa due to the
negligence of her new acquired partners at the time who had created almost 5
Million Rands worth of debt in only a few months. Maria was told by the attorneys
that she must liquidate since it was illegal to trade in an insolvent company.
Once again, Maria single handedly picked up the pieces of the wreckage and
brought the debt down to a commendable R500000.00 within only one year. Maria
would not let her vision die. For her, it’s about honor and not giving up her dream
of showcasing Maria Garcia to the world that South Africa HAS got what it takes.
Today, Maria has not only restored confidence, value and profits into Maria Garcia
International™, but she is also the visionary and creator behind another skin care
brand Isabella Garcia™.
‘I sometimes
giggle
to myself,
thinking
how I
have grown
from being
a Portuguese,
uneducated
peasant
to jet-setting
around
the world
on
business trips’
“Looking back, I still hold with me the
discrimination I experienced, being called a
Portuguese Peasant, being told that I am mad
and could never challenge the skincare giants.
For example, after I came into some money I
went to see one of the major buyers of a huge
retail chain in South Africa to launch Maria
Garcia™ into the stores and I shared with him
that I would like to go global. I will never forget
how he threw his hands in the air, told me I had
lost my marbles and roared with laughter,
informing me that I would need a minimum of
US$ Four Hundred Million to compete.
At that time, I did not know if he was right and
he took away my confidence, but somehow I still
kept my faith, and knew that I would succeed in
my life, if not with cosmetics then by making a
difference in people’s lives. Before I stood up to
walk away I looked straight into his eyes and told
him “You are right, and I may never make it, but
at least when I reach the age of 70, I can
proudly say South Africa, I have done my best”.
After this meeting I made the conscious choice to
become fearless, as it is fear that so eagerly
blocks one’s destiny. Staying dormant just to
protect a couple of pennies would take me to my
grave; I had no choice but to go against the odds.
I am so blessed to do what I love most in this
world, and that is creating jobs and making a
profound difference in this universe. I sometimes
giggle to myself, thinking how I have grown from
being a Portuguese, uneducated peasant to jet-
setting around the world on business trips,
learning from, meeting and greeting people of all
walks of life, having dinner with the Queen of
England and the President of our Country and to
seeing the shop windows of international
boutiques in foreign countries displaying Maria
Garcia™ with lively panache and confidence next
to the Armani’s, Lauder’s and the Dior’s of this
world. And still, nothing has fulfilled me as much
as when my clients write to me and thank me for
making a difference to their skin and their lives.
The one lesson that I will still hold true and close
to my heart for the rest of my journey, is what
our former president and father of our country,
Nelson Mandela once told me, “Maria, you have
to go through pain to get courage and strength”.
40 WealthWise
BusinessWise
Today, as I am
getting on in years, I
am grooming my
daughter Nerissa to
carry the torch of my
legacy, while I focus
on my beauty road
shows, reaching
women from all
walks of life,
educating them,
motivating and
inspiring them to
achieve their
greatness as I
continue to lovingly
create all the
products for Maria
Garcia™ and Isabella
Garcia™”.
To learn more about
Maria Garcia
International, visit
www.mglabs.co.za,
call +27(11) 262
2772 or email
infoexpert@mglabs.
co.za.
WealthWise 41
BusinessWise
C
A
R
E
E
R W I S E
Quick Read: What do employees want?
WealthWise 43
Why some employees are loyal to an organization and others are not? We have
pointed out below some of the facts you have to keep in mind if you are an
employer and think about if you are an employee.
Be engaged in the company’s culture. Employees want to be an active part of
a company and show pride in working for the company and its vision.
Make a contribution and be acknowledged for it. Employees want to be
valued for being part of something greater and making a difference.
Be recognized verbally or written. Employees want to be shown respect and
appreciation for their work. A simple “thank you”, whether verbal or written on a
card, means a lot to them.
Be themselves in the workplace. Employees want to have the possibility of
showing their creativity, talent and abilities at work, without being offended. Also,
they don’t want to be forced into putting other masks in order to strive at the
workplace.
Work in a professional, positive and creative work environment. Employees
want decent work conditions, a positive environment with room for growth.
Be challenged. Employees want a stimulant, challenging environment to show
their best. Stalling at the workplace with no ambitious projects and promotion in
sight calls for a job change.
Have a contract of employment. This is an absolute must for an employee and
should be always required upon starting a job.
Be paid and be paid in time. This one is non-negotiable: employees want to
receive a decent pay for their services (market-related) and received it as
stipulated in the contract of employment. If the company experiences cashflow
problems, the employer should advise beforehand to avoid unpleasant situations.
Honesty. Employees should expect honesty and transparency from their
employers and vice-versa.
44 WealthWise
Does your
Management Team
give 100%?
Article provided by The HR Hub
I recently came across a summary of a new book by Mark Murphy and the title
caught my eye – “Hundred Percenters”. Hundred Percenters are those employees
who give 100% commitment, energy and motivation to their jobs. Hundred
percenters make things happen, go the extra mile, have the best interests of the
organisation and its clients at heart and they do not make excuses for poor
performance.
How many Hundred Percenters are out there?
I wondered, "How many hundred percenters there are out there? How do you know
when you have a hundred percenter? Where and how can we go about recruiting
hundred percenters? I wonder what the going rate for a hundred percenter is,
because I am sure that if we are able to find them and bring them into our
organisations, then surely we are set for success?"
A while later I got to wondering how many hundred percenter leaders there are out
there? People who are examples of commitment, dedication, passion and
productivity to their team members and what is the relationship between hundred
percenter leaders and hundred percenters?
Most employees (over 72% surveyed) said that they do not give 100% at work.
Murphy says in his book that in order to improve, these people need leaders who
both challenge them and connect with them: "100% Leaders."
If you do not have many hundred percenters in your team or organisation, is it a
sign that you do not have 100% Leaders? Does the number of hundred perecenters
increase as the number of 100% Leaders increases? After considering this for a
week or two, I have decided that without 100% Leaders, we will never have enough
hundred percenters to create and maintain a hundred percenter culture.
Creating a Culture of Hundred Percenters
The way to create a culture of "Hundred Percenters," according to Murphy is to
promote, praise and reward excellence. He suggests that 100% leaders should do
the following: set "HARD - heartfelt, animated, required, difficult - goals" that push
their people; invite their staff to partner with them to eliminate mistakes; avoid
blaming and communicate openly and honestly without attacking or threatening
their people; identify people's "tugs," or motivators, and their "shoves," the de-
motivators that might "shove them out the door"; and tell talented people with bad
attitudes to fix their frame of mind or leave, even if they're great in every other way.
’Hundred
percenters
do not
make
excuses
for
poor
performance‘
WealthWise 45
CareerWise
The HR Hub is a unique on-line HR Services
company where clients can obtain a number of
“best of breed” HR products and services under
one roof.
The HR Hub’s leading L&D Service provider
specialises in developing and implementing
practical, customised management and
leadership development solutions, enabling
hundreds of South African managers to enhance
their management effectiveness and success
over the past twenty seven years.
Until the last point, I was a little concerned that
Murphy might be one of those leadership thinkers
who is so busy focusing on the positive that they
conveniently forget that there are any negative
elements to be addressed. These leaders live in a
world of building on strengths and moving people
to where they are more comfortable etc without
dealing with the difficult issues. But no, he does
include dealing with people who threaten the
creation of a hundred percent culture - Bravo!!!
Train Your Leaders to be 100%
Leaders
Of Murphy's 10 Lessons to Create a 100% Culture,
I think that # 5 is key as it influences the other
nine elements and that is # 5 "Train your leaders
to be 100% Leaders" – Provide comprehensive
training, continuing education and routine
professional development."
Excellent and effective leadership and management is learned, and anyone who
sets their heart and mind on being a 100% Leader, can become one. But
education, dedication, commitment and concern for others are not enough to
enable the achievement of this challenging goal. 100% Leaders and managers
need a broad range of self-management, one-to-one leadership and team and
organisational leadership competencies in order to be effective managers and
leaders. They need to develop their own emotional intelligence, enhance and
improve their communication, interpersonal, leadership and performance
management skills and effectiveness.
Become a 100% Leader
So what should people and companies focus on to become 100% Leaders and
create hundred percent cultures? We must select and implement relevant,
practical learning programmes that are structured to enable our managers and
leaders to develop and entrench the required leadership skills.
For more information, call (011)
475 8915, email
visit www.thehrhub.co.za.
46 WealthWise
The Role of
Company Culture
for its Employees
A company culture can make or break its relationship with employees. Knowing
your company’s culture will enable to attract the right top talent and foster better
employee relationships.
A company culture is defined by the employees’ perception of the place where they
work and whether do they feel an important part of the organization. The good
news is that a strong workplace culture can be built to attract top talent and
enhance positive growth.
Generally speaking, a company culture refers to the following:
• A clear definition of vision, mission and business values
• A positive work environment
• Fair compensation packages
• Attractive benefits packages for employees
• Recognition and acknowledgments from management
• Enhanced learned experiences through training and consultations
• Open communication
• A challenging, stimulating, motivational and creative environment
• A possibility for career development and growth within the organization
Employees must pursue the company culture as follows:
• Understand the company values, mission and goals
• Be able to talk about the company’s history, achievements and future plans
(if disclosed)
• Be willing to support the organization and work towards its vision
• Be loyal to the company and its customers
• Engage, commit and align with the company’s strategy
• Provide feedback on the workplace conditions and practices
• Have their opinions regularly surveyed by the company’s management to
enhance the company culture experience
If employees cannot identify with the company culture, they will choose to work
elsewhere. Not every organization is the right fit for an employee and the culture of
a company is a decisive factor in attracting, building and maintain good, reliable
and talented workforce.
A
G
E
N
D
A
This month we inspire you to...
WealthWise 47
Support a greater cause
Charitable causes have a positive impact on our
wellbeing and give everyone of us the chance to
work towards a greater cause. Get involved and
find out what can you do to make a difference in
others' life at www.greatergoodsa.co.za. The
website lists South Africa's most popular non-profit
organisations and charities.
Get a second opinion
From medical aid to insurance and mortgage,
www.justmoney.co.za is a handy guide to
money management, offers various comparison
tools to help you make the best decisions and
the chance to ask questions and get them
answered by experts in their own field. A good
start if you're looking at changing your insurance
policy or opening a savings account, for
example.
Know your banking fees
Banking costs, fees and product features are
easily revealed with www.bankmonitor.co.za,
South Africa's bankmonitor comparison
calculator. Just choose among your products of
interest and compare! All banking products are
covered, from savings accounts and credit cards
to loans and money market accounts. Well worth
a read before going...shopping!
48 WealthWise
Whisky
Wise
by Patrick Leclezio
We live in a fiercely competitive world. That’s how it is, for good or bad,
particularly in the liquor business. This gladiatorial arena is adjudicated on an
annual basis by The Power 100, a survey that evaluates the world’s most powerful
spirit and wine brands, with power in this case being defined as a brand’s ability to
generate value for its owner. The 2010 issue had whisky firmly entrenched in the
number one spot chalking up a total brand score of more than twice its nearest
competitor. It is quite simply the indisputable king of spirits…but a cultured and
benevolent king, with much to offer in return.
The history...
Whisky, the golden nectar of the gods,came to us somewhat appropriately from
Irish monks who had transported distillation techniques from Continental Europe.
They called it “uisgebeatha”, the water of life in the Gaelic of that era. This Irish
birth is believed to date back to the 5th century AD, but whisky’s early history is
shrouded by time and the first official reference was only recorded a millennium
later in 1494, when it was mentioned with little fanfare in the Exchequer Rolls in
Scotland. From those obscure beginnings in what were then backwaters it has risen
to become the world’s dominant spirit.
Today whisky is made not only in Ireland and Scotland, but all over the world.
Thriving industries exist in the US, Japan, Canada, and somewhat controversially, in
India, where the bulk of “whisky” is made from molasses, and therefore is not
considered to be whisky elsewhere.
The flavours...
Whisky is generally defined as a distilled spirit made from cereals, yeast and water,
so, with the exception of the Indian stuff, every whisky that you’ll encounter is
made from some sort of grain, or mix of grains. Whilst wood is acknowledged to be
the single most important contributor to flavour, because all whiskies are aged in
wood to some extent, it is these grains which in simple terms define the difference
between one style of whisky and another.
Single malt, the heart of the Scotch whisky tradition, is made from malted barley,
which is often peated. The influence of the peat can be identified in the smoky
flavours characteristic of Scotch; whiskies such Ardbeg, Laphroaig (pronounced la-
froyg) and Lagavullin (laga-voo-lin) are prominent examples thereof.
WealthWise 49
Agenda: Destination
The Irish counterpart to single malt is pure-pot
still, made from a recipe of predominantly
unmalted barley, giving its whiskeys spicy
notes. The Midleton Distillery, producer of
Jameson and Tullamore Dew, is a noted
exponent of this style. American whiskeys, of
which bourbon is the flagship, generally have
softer, sweeter flavours, a product of the
largely corn based recipes (with rye or wheat
in the background), and also because ageing
occurs entirely in virgin wood. Maker’s Mark,
Jim Beam and Woodford Reserve are
noteworthy examples.
These are broad generalisations though. Each
style, whilst having its own unique heritage,
and its own particular charm, is by no means
uniform, far from it. A floral Lowlander has
little in common with a pungent Islayer. It is
the extent of variety, both between styles and
within styles, that has built the lore of whisky.
As a result the enjoyment of whisky is a never-ending adventure of subtleties and
nuances: there is always something new, something more, to taste, to learn, to
explore, around every corner. One can never know all there is to know.
The investment...
I have earlier mentioned the Power 100 2010 survey. A total of 27 whisky brands
are featured in this elite group. Whisky is big business, certainly for the corporate
owners of brands and distilleries, and for the retail trade, but also, increasingly, for
the individual investor.People are realising that not only can you drink it, but you
can also ride it…all the way to the bank. There are various avenues open to the
average investor.
Firstly, a variety of major distillers offer casks
for sale. You would literally buy a cask’s
worth of new make spirit, which can after a
time be either bottled, sold, part exchanged
or further matured.This is not a quick road to
riches.
I imagine it would provide at best a solid, but
unspectacular return, and at worst, if the
market collapses in the future, a lifetime’s
supply of whisky. It’s best suited to a whisky
lover – you typically get to visit your cask
during milestone moments, taste from the
cask, and have regular reports on its
progress submitted to you by the master
distiller. This is “investertainment” at its
best.
50 WealthWise
Agenda: Destination
Secondly, you can readily buy and sell bottles
of whisky for profit. Until recently this was done
through established facilitators such as auction
houses and specialist retailers. Auctioneers
Bonhams grossed £430 000 at their Edinburgh
auctions alone last year, primarily attracting
collectors and investors, who to an extent are
one and the same. Soaring demand
intersecting with scarce supply, particularly of
old, premium whiskies made at a time when
production outputs were more conservative,
has driven an exponentialgrowth in prices.
There are stories that have become the stuff of
legend. Martin Green, Whisky Specialist at
Bonhams, recounted the history of the 1964
Black Bowmore, released in limited batches in
1993, 1994, and 1995, at less than £150 a
bottle. The whisky was a novelty, black in
colour from the unusual Oloroso sherry casks in
which it was aged, and became highly regarded. The bottles released were
snapped up and soon thereafter started appearing under the hammer fetching on
average £2000 a pop. The 1993 bottling now sells for over £4000 where and when
available, circa 28x its original value.
Thirdly, you can invest in a whisky portfolio run by whisky “fund managers”, a
relatively recent innovation. Such has been the value explosion in whisky, and
such is the potential, that a group of Dutch businessmen have established an
organization called the World Whisky Index World Whisky Index allowing investors
to buy and sell authenticated whisky in a structured trading environment. Minimum
buy-in as advertised by their website is € 5000, although in recent correspondence
they advised me that this is now € 25000, so not just fooling-around money.
In practical terms, you buy a portfolio made up or bottles and/or casks with or
without the guidance of the Whisky Talker (their version of the Horse Whisperer, I
guess). This portfolio is then traded on the exchange, bids are received for
individual whiskies, and their values fluctuate like shares on an exchange. In 2010
the average portfolio at the World Whisky Index increased in value by some 7.9%,
or so they claim. By European standard that’s a healthy return.
I take a measured view on all of this. Big wins are undoubtedly possible, like they
are in the stock-picking game, but I’m an efficient market theorist at heart and I
believe that all publicly available information has increasingly been accounted for in
whisky pricing. The market is also changing and supply discrepancies will no longer
be as acute in the future, as brand owners look to ramp up production and lay
down increased stock.Will whisky continue to appreciate – probably. Will the
strong growth of recent years continue – not sure. You pay your money and you
take your chances.
Whether your objective is to drink it, to collect it, to invest in it, or to just
contemplate it from afar (I recommend the first one), whisky has stirred our
collective consciousness. W.C. Fields, the American comedian, said: “Always
Photo: Patrick Leclezio
WealthWise 51
Agenda: Destination
carry a flagon of whiskey in case of snakebite and furthermore always
carry a small snake”. He obviously didn’t live in mamba country, but you get the
drift. On that happy note allow me to resort to the clichéd whisky writer’s sign-off
– Sláinte!
Shaken not stirred
I’m often asked how whisky should be drunk, and I thought I knew all there was to
know (always a mistake with whisky). Younger whiskeys, particularly of the
American and Canadian styles, can be suited to mixing, or used a base for
cocktails such as the Mint Julep, Manhattan, and Old Fashioned, if that’s your
inclination.
Older whiskies are best enjoyed with a splash of water - filtered or bottled (still) so
that the chlorine does not contaminate the flavour - at room temperature.
The Bascule Bar in Cape
Town offers a choice of
over 400 distinct whiskies
Photo: Patrick Leclezio
Shopper’s guide
This is tough. We live in a whisky world where we’re spoilt for choice, and where
we’re not short of quality. Taste is also highly individual – what one person likes
another might not. I simply can’t commit to any favourites, however if you travel
these roads you’re unlikely to get lost.
Scotch blend: Ballantine’s
Premium Scotch blends: Johnnie Walker Black Label, Chivas Regal
Affordable single malts: Aberlour 10yo, Glenmorangie 10yo, Macallan 12yo
Sherry Wood, Glenfiddich 15yo Solera, Dalmore 12yo, Glenrothes Select Reserve,
Benriach10yo Curiositas and Bunnahabhain 12yo.
Irish blends: Jameson, Bushmills Original
Bourbon: Maker’s Mark
Rye: Sazerac 6yo
52 WealthWise
Die DopPaleise
In case you haven’t noticed, South Africa is mad about whisky, Scotch in particular.
We are the 5th largest export market worldwide, having shelled out £169 million
to the Scots in 2010. However, the premium sector is still immature, and a tangle
of red-tape makes it difficult to bring in new products. The upshot is that when
we’re out dramming, we usually can’t pick and choose from the variety of top-end
whiskies that is available in some developed countries. I say usually. Because
there are a few exceptions, a few shining beacons of whisky civilization out here in
deepest darkest where you can uncompromisingly slake your thirst.
These are my four standouts: The Bascule Bar in Cape Town, which offers a
choice of over 400 distinct whiskies, Katzy’s and Brown’s which are the
epicentres of the Gauteng whisky scene, and Wild about Whisky, a small bar in
Dullstroom (where else) boasting a choice of over 800 whiskies, apparently the
largest whisky menu in the Southern Hemisphere. I should qualify that I’ve yet to
find my way to the latter, but it lives large on reputation alone. I don’t think you’ll
be disappointed. Read Patrick Leclezio's profile on page 6.
Wild
about
Whisky, a
small bar in
Dullstroom,
boasts a
choice of
over 800
whiskies,
apparently
the largest
whisky
menu in the
Southern
Hemisphere
Photo:
Patrick
Leclezio
Use a glass with an inward tapered rim if available, so that the vapours are
concentrated, allowing you to optimally enjoy the aroma or nose of the whisky. I
tend to stay away from neat whisky, apart from an initial sniff and sip if I’m doing
a formal tasting, because I find that the undiluted alcohol can be a sensory
anaesthetic, although some would disagree. That comes down to personal taste,
as does ice – to use or not to use.
It’s in this regard that I recently acquired some cool new knowledge. Cold can
inhibit flavour, but room temperature varies from Dundee to Durban, so it may be
justifiable for regulation. However ice melts, and quickly, especially where it’s
needed most, and this introduces uncontrolled dilution into your drink. I don’t like
my whisky tasting like the back-end of a slush puppy, so I had tended to avoid ice,
even in high heat…but now I don’t have to. Enter the ice-ball: take the same
volume as a block, get less surface area, and therefore less dilution. Experiment,
enjoy, and may the dram be with you.
Agenda: Destination
WealthWise 53
Competition
WIN one of 10 educational CDs
"Payroll with a Voice"!
Rekopane Payroll Services have developed South Africa’s first Payroll
Audio Support Program called ‘Payroll With A Voice’, assisting
entrepreneurs to ‘Demistify payroll for good’. ‘Payroll with a Voice’
programme is a comprehensive payroll workshop packaged in an audio
and documents CD containing audio presentations of the different
principles that affect payroll, customizable payroll plans, job descriptions
and performance appraisals, plus payroll registration compliance.
All you need is a CD\MP3 player to start enjoying and learning more about
payroll. Learn at your own pace, anytime, anywhere. For more information
on 'Payroll with a Voice", visit www.rekopanepayroll.co.za/payroll-with-a-
voice.
To stand a chance to win one of these CDs, join our WealthWise Club
absolutely free by subscribing at
www.wealthwisemag.com/wealthwise/subscribe or by clicking the
Subscribe button on the website's menu bar. Competition starts 10 May
and ends 10 July. Winners will be notified in mid-July via phone/email.
Learn about
payroll
at your
own pace,
anytime,
anywhere!
On the bookshelf...
Dambisa Moyo, How the West
Was Lost
Allen Lane, Penguin, R208.00 from Exclusive
Books (www.exclus1ves.co.za)
Oxford-educated economist and author of New York
Times bestseller Dead Aid, Dambisa Moyo was listed
in 2009 among Time Magazine world’s one-hundred
most influential people. “How the West was Lost” is
yet another provocative and articulate book on yet
another hot topic: the failure of western countries and
their increasingly flawed economic policies in the face
of the rising emerging economies like China. Where
have the most advanced countries in the world failed
and how will the future look like?
Moyo’s clever speech does not only analyze the
severe consequences of the last fifty years of
America’s economic decline. She outlines the stark
54 WealthWise
Agenda: Books
WealthWise
recommends
choices that political leaders have to make to prevent a further catastrophic decline
of power, by addressing the three essential ingredients for growth: capital, labour
and technology.
Covering America’s evolution from the Great depression of the 1930s to the recent
2008 global recession, the book depicts the whole picture on how everything
started to go wrong and most importantly, why, explaining the reasoning behind
the recession itself and the faulty policies America continues to rely on. This is
probably the most interesting point of discussion and if you’ve ever wanted to
understand this phenomenon, this is the book that explains it, clean and simple.
On the other hand, the overview of the emerging nations is credible, as much as
the possible policies America needs to embrace to get back in the race.
Financial Times called it “a damning assessment of the failures of sixty years of
western development”, we call it a hopeful turning point for the western economy
and perhaps for the global economy. Let’s just hope that the message goes into the
right ears.
"For me, finding a sustainable solution to Africa's woes is a
personal quest. Having been raised in one of the poorest
countries in the world, I feel a strong desire to help families
like my own, who continue to suffer the consequences of
economic failure every day of their lives. (...) I have often
wondered, while other emerging regions have ostensibly
turned the corner towards economic prosperity, why my
continent has failed". In her first book, "Dead Aid",
economist Dambisa Moyo offers her perspective on ways of
economic growth on the African continent. Controversial
and passionate, the book carries an important message of
change.
Mark Williams, Mindfulness - A Practical
Guide to Finding Peace in a Frantic World
Penguin, R187.00 from www.kalahari.net.
Mark Williams is a Professor of Clinical Psychology at the
University of Oxford who co-developed Mindfulness-Based
Cognitive Therapy (MBCT) and co-authored the
international best-seller “The Mindful Way Through
Depression”. In his most recent book, “Mindfulness – a
Practical Guide to Finding Peace in a Frantic World”,
Williams reveals simple, yet powerful daily practices and
meditation that help breaking the cycle of unhappiness,
stress, anxiety and mental exhaustion. Based on MBCT,
the book promotes mindfulness meditation which takes
just a few minutes a day for the full benefits to be
revealed, whether you suffer from depression or not.
Bonus: the book comes with a free CD containing
mindfulness guided meditations!
Malcolm Gladwell, Blink - The Power of
Thinking without Thinking
Penguin Culture, R123.25 from
www.kalahari.net
Author of the best-seller Tipping Point, Malcolm
Gladwell delivers yet another thought-provoking and
compelling book. This time, he goes deeper into the
“blink” phenomenon, referring to those moments
when we know something without actually knowing
why – our snap judgement or intuition. Can a snap
judgement be far more effective than a carefully
analyzed decision? The answer might surprise you,
yet this is the essence of “Blink” and its
revolutionary theory that could radically transform
our lives, from business to relationships. As in the
“Tipping Point”, Gladwell uses real cases, interviews
and psychological studies to prove that “less is
more”. You'll never think about thinking in the same
way again – trust our snap judgement!
Letter to South Africa, Poets Calling
the State to Order
Umuzi, R144.50 from www.kalahari.net
“South Africa, hey, I’m talking to you –
it’s like praying, like mourning, like whimpering to”
Various South African poets are cited in this frank,
hard and honest anthology of South African poems.
Written in English, Afrikaans, isiXhosa and Sepedi,
with English translations included, the poems have
nationwide appeal and address the Republic of
South Africa, calling the state to order.
WealthWise 55
Agenda: Books
Events, workshops and seminars
56 WealthWise
Agenda: Events
The Franschhoek Literary Festival
When: 13-15 May
Where: Franschhoek
The annual Franschhoek Literary Festival in the
spectacular Winelands region gathers local poets,
authors, illustrators and editors to the likes of Zakes
Mda and Janice Galloway and showcases book
readings and talks to thousands in the audience. For
more information visit www.flf.co.za.
The Good Food and Wine
Show
When: 26-29 May
Where: CTICC, Cape Town
Decadent dishes created by the most
talented chefs in South Africa,
international celebrity chefs, food
stands, workshops and delicious wines
- expect no less at Cape Town's
favourite food festival. The Lindt
Chocolate Masterclass is a must for
chocolate lovers! For more
information go to
www.goodfoodandwineshow.co.za
Indaba South Africa
When: 7-10 May
Where: ICC, Durban
Indaba is Souh Africa's biggest tourism
expo, with local hotspots, holiday specials
and international destinations on offer. To
find out more, go to www.indaba-
southafrica.co.za.
Standard Bank Fine Brandy Festival
When: 25-27 May
Where: Sandton Convention Centre,
Johannesburg
Brandy lovers have more than one reason to tempt
their taste buds - fine brandy, somptuous food and
even fashion shows make up for a feast for all
senses! To find out more, go to
www.brandyfestival.co.za.
WealthWise 57
Do you have an event, workshop or seminar you would like to promote in
WealthWise magazine? Send your suggestions to
[email protected] and we will publish your event in these
pages!
Agenda: Events
Grand Designs Live
When: 20-22 May
Where: Coca-Cola Dome,
Johannesburg
Get inspired by stylish design, amazing
architectural pieces and decoration for
your DIY home and office decor. Visit
www.granddesignslive.co.za for
details.
Marketing Indaba
When: 19-20 May
Where: CTICC, Cape Town
The Marketing Indaba includes a
marketing conference plus five exhibitions
AdExpo, Promo Expo, ICT Expo, PrintPack,
and CRM Expo with the latest industry
developments in advertising, marketing,
communication, technology, promotions,
customer relations, printing and
packaging. For more info, visit
www.marketingindaba.com.
SciFest Africa
When: 4-10 May
Where: Grahamstown
Scifest Africa has been around for
fifteen years, bringing a passion for
science and innovation in South Africa
and educating the youth with lectures,
workshops and exhibitions. To find out
more, visit www.scifest.org.za.
L
A
S
T
W
O
R
D
58 WealthWise
Finance for Growth
by Denisa Oosthuizen
One of the lessons we have learned while compiling our May issue was
that finance should be geared for growth and the need to finance varies
according to the different stages the company goes through. We have
also acknowledged that in order to access finance, you need to be
innovative and not always follow the traditional bank route. And, probably
the most arguable of all, that you need a positive track record, whether in
your capabilities or the ability to bring money in, to gain access to further
finance and growth.
I had the privilege to meet, a couple of weeks ago, Allon Raiz, the CEO of
business incubators Raizcorp, at one of his presentations and networking
sessions for entrepreneurs, most of them Raizcorp members. I was invited
and introduced to this entrepreneurship community by a mutual friend and
fellow entrepreneur who benefited from Raizcorp’s incubator in a number
of ways.
Firstly, his journey began a couple of years back, when the company had
the potential for growth, without being necessarily profitable (Raizcorp
does not require profitability to join its network, however a track record is
highly desirable). As with business incubators, the major changes were in
defining new revenue streams (the business model altogether), refining
the business’ strategy, thus leading to an increase in the number of
customers and finally, revenue.
To be honest, this type of business “help” does not provide finance for
your business in the way the traditional banks or investors will do. And the
more I think about it, the more I realize that debt-financed money in your
business account is not always the way to go. Plus, the debt financed
money can be misused or inappropriately spent, resulting in more
expenses at the end of the day. The support, networking opportunities,
mentorship and guidance a business incubator provides is invaluable. And
it still focuses on growth, which is enough to generate the revenue and
positive cashflow your business needs, so you won’t have to go for major
financing elsewhere.
So next time when you need a finance boost, innovate, rethink and seek
guidance from mentors and fellow entrepreneurs who went through the
same thing as you do now. They might not handle you the cash, but guide
you in the right direction to increase your sales, your profit margins and
handle more clients. Who said anything about going to the bank?
N
E
X
T
E
D
I
T
I
O
N
I N O U R
WealthWise 59
Investing in volatile times
Evan Jones, Managing Director of Cadiz
Investments, has something to say about
investing in a volatile market and why
asset allocation is so important.
How can Corporates work
with the Government?
Is interaction with Government
important? How can a strenghtening
partnership between Corporate South
Africa and the country's government
benefit its citizens? See what can be done
and what some of the biggest corporates
in SA have to say.
Effective SMS marketing
Is SMS a good marketing tool for your
business? We show you why and how it can
work for you and your business.
More than meets the eye
Could the impact of the earthquake disaster in
Japan on the global economy be far worse than
the market initially expected? Dr Prieur du
Plessis, chairman of Plexus Asset Management
and author of the Investment Postcards blog,
looks at the whole picture.
.
Click. Read. Learn. Share
www.wealthwisemag.com