Johannesburg - The small township entrepreneurs who signed up for the Pick n Pay local economic development franchise clearly lacked the business wiles of the supermarket chain as, after their businesses were looted, they remain saddled with debt while the franchisor is smiling all the way to the bank.
Sicelo Thuketane, whose store Lethabo’s Market in Bramfischerville was looted clean on 12 July, 2021 could only stand by and watch as the insurance payout from (Sasria) was diverted to Pick n Pay, who swiftly took R480 000 they claim Lethabo’s Market owed them for stock.
They then returned the surplus sum to brokers Marsh, who had no business getting the money. To their credit, Marsh returned the R2 387 390. 60 to Sasria.
Pick n Pay only returned this money after a lot of legal correspondence. In a 7 March, 2022 letter to Thuketane’s lawyers, Marweshe Attorneys, Pick n Pay says, “as agreed, R480 000-00, being the value of the looted stock”.
The only loser in the unrest are the store owners, who are left wondering “how exactly is Pick n Pay empowering us” when it is clearly bent on collecting every cent, by hook or by crook.
But as at 25 January, 2022, Pick n Pay sent Thuketane and his business partner, his wife Alice Manene, a letter showing they still had an amount owing: R2 755 361. 22. (The R480 000 was the value of the stock on the day of the looting.)
“This (R2.7m) is for revolving stock that I took,” Thuketane clarifies, “but even after we stopped trading in July 2021, they continued charging us interest. That figure includes interest.”
This means Pick n Pay is home and dry. They did not suffer any damages emanating from the looting.
The two payments from Sasria to Pick n Pay are curious. Sasria insurance letter, on 16 February, 2022, the agreement details were changed with a pen to make the money payable to Pick n Pay. The agreement clearly states that the money is to be paid in full to the insured, Lethabo’s Market.
The new insured was now Julietta da Silva, Franchise Financial Controller, redirecting the money to an Absa Account R2 867 390. 60. Still Sasria paid Pick n Pay.
Writing to the attorney of Lethabo’s Market, Sasria admits they “made an interim payment of a sum of R1 000 000.00 (One million rands) directly to your client and the second payment was made to Pick n Pay. The payment to Pick n Pay was made after your client amended the Agreement of Loss, directing us to make Payment to Pick n Pay as per a contract between the two parties. A copy of the amended Agreement of Loss is attached herein.”
“Sasria then proceeded to make payment to Pick n Pay, however, Pick n Pay paid over the settlement monies to Marsh, who then returned the same to Sasria. On or about 1 April, 2022, Sasria received a letter of demand from The Small Enterprise Finance Agency SOC Limited (“SEFA”).”
Contacted for comment on why the payment to Pick n Pay was made on the strength of the altered letter, Sasria promised to revert but never did until we went to print.
A month after the July unrest, having promised the store owners that they will be assisted – including with salaries to their employees, which never happened, Pick n Pay did another master stroke, persuading all looted owners to sign a cession agreement.
Thuketane initially refused to sign, thereby muddying his relationship with Pick n Pay. His wife signed it on 18 August, 2021, ceding all insurance payments of stock lost in the violent uprising to Pick n Pay.
Pick n Pay signed this agreement two days later, on 20 August, 2021, same letter.
Marweshe Attorneys, in a letter to Sasria dated 22 February, 2022 states the following, among others: - Our client’s business was destroyed and looted during July 2021, unrest and public violence.
- Our client’s claim was lodged with Sasria, pertaining to the damages and business interruption.
- On 26 January, 2022, Pick n Pay served our client with a notice of termination of the agreement.
- Our client was informed on 17 February, 2022, by Crawford that it had recommended “the full property damage amount of ZAR 3 867 390.60”.
- Despite the fact that our client’s claim was approved by Sasria, to date, our client has not received any payment in respect of the claim made.
- Our client’s business has not been operating, amid the looting in July 2021.
- Thus, the delay in processing our client’s claim is inordinate - our client has lost profit and its employees are without work.
Liquor sellers make money through rebates from suppliers. This is money that Pick n Pay’s franchisees should also be pocketing, instead it went to the supermarket chain.
With all their talk about helping to revive the township economy, Pick n Pay does not lose a cent. They leave nothing behind, even in the wake of looting.
In the new cessions agreements that Pick n Pay is pushing down the throats of township business partners, they have signed away their souls. In the event of a disaster, like the lootings, they have, in black and white, agreed to lose everything, not just stock.
Those who refuse to sign away their livelihoods, are treated like enemies and, like Thuketane, have contracts terminated.
Pick n Pay says: “The information you have received is incorrect. R480 000 was owed to Pick n Pay by Lethabo’s Market Store for stock which was stolen during the riots, and which had not been paid for by the owner. The store owner agreed that this amount should be paid directly to Pick n Pay from the insurance claim, and we sent the remainder to the insurers. Lethabo Market Store received the rest of its insurance claim on 12 August, 2021, and all of the funds were paid to the owner. Lethabo’s Market Store still has further outstanding debt for previously unpaid stock from us.”