[miningmx.com] — IN KATHU there is almost one car for every thorn tree these days.
This Northern Cape mining town, situated in a region overrun by thorn trees, was turned completely upside down on 15 December, when Kumba, for which most of the 10 000 residents work, paid up to R576,045 to each of its permanent employees as part of its Envision share scheme.
Since then money has been flowing like water.
The people of Kathu bought cars on an almost unprecedented scale. According to municipal manager Moses Grond, the traffic congestion is now so bad that in the mornings it can take from half an hour to an hour to cover the less than 5 km from the central district to the mine. Those who previously used the mine’s bus service are now driving there in their new cars. “We even had to upgrade the road and install two traffic lights,’ he said.
There are no motor dealerships in Kathu, but dealers from Kuruman, Kimberley and Upington started displaying their vehicles on a parking lot next to the local Fit-it fitment centre, said Rudi Combrinck, the owner of Fit-it. This included agencies for Toyota, Ford, BMW, Volkswagen, General Motors and Yamaha motorbikes.
One second-hand dealer Sake24 spoke to, came from Lichtenburg with vehicles and has in the past three weeks sold 20 vehicles from his bakkie at the side of a road – all for cash.
Furniture was also selling like hot cakes, said Elsabe Faber, manager of Beares in Kathu. “Our budgeted income for December was R423,000, and already we’re standing at more than R1m – only 3% of it on credit. Even our branch in Kuruman, where the target was R500,000, was already at R840,000,” Faber said.
Faber said the biggest challenge was to replenish stocks, and the number of deliveries from the storage depot in Kimberley had to be increased.
She said that the income of a salesperson who would normally have earned R7,000 per month went up to R28,000 in December, due to the commission on the Kumba-related sales.
Not all the shops in the town benefited equally, but in the Kathu Village Mall the tills never stopped ringing, said centre manager Riekie Terblanche.
Compared with the previous December, there was a 19% increase in pedestrian traffic, she said. And this wasn’t new people, but the same people who kept returning to buy more and more things.
According to provisional figures, the amount spent in the centre on glasses and sunglasses was 328% higher than the previous December. About 189% more was spent on jewellery and 132% more on stationery – which included electronic goods like camera, laptops and PlayStation and Xbox games consoles.
Sales of men’s clothing increased more (by 96%) than women’s clothing (54%), and the turnover of restaurants and fast-food outlets virtually doubled. Rudi Bothma, manager of Superspar in the centre, said his grocery store’s turnover rose by 53%, and that of the neighbouring Tops liquor store was 67% up.
Annette Schoultz said the DStv installations done by their family business, J&R Computers, increased dramatically last month. Instead of the normal 30 installations per month, there were 49 just between December 15, when the money was paid out, and Christmas. In addition, the shop sold 20 high-definition personal video recorders (HD PVRs), an item for which there is normally very little demand.
Many residents are concerned that the Kumba employees are wasting their money. Most of the National Union of Mineworkers (NUM) members at Kumba earn about R5,000 per month, NUM spokesman Lesiba Seshoka said earlier.
However, the manager of one of the smaller banks in Kathu, who wishes to remain anonymous in terms of company policy, said that the amount of money invested in December were three times higher than in a normal month.
Many Kumba workers also paid off their arrears service fees at the Gamagara municipality, Grond said. The municipal council had made prior arrangements with defaulting payers in this regard. He showed Sake24 one account on which more than R18 000 had been outstanding, but since the Kumba pay-out this has been fully paid off. These payments considerably improved the council’s cash flow.
– Sake24
