Skip to main content

The Waiter Who Served Himself A Supermarket Empire

Published 8 years ago
By Forbes Africa

It was a bad time for new beginnings. The year was 1976 and South Africa was burning. The township youth was protesting against Bantu education and it was then that the 18-year-old Tommy Makhatho walked out of school with nothing.

Life was bleak; it took him two years to get a lowly job as a waiter in the Carlton Hotel in Johannesburg. It was here where his life changed.

“Life was hard at the time but I was so motivated to try my hand at anything,” says Makhatho.

This is the epiphany of a man who spent his teenage years moving from one relative’s home to another.

It all began the day he met flamboyant hairdresser Brian Gule, dressed in a cowboy hat and boots, in the coffee shop at the Carlton Hotel.

“I was amazed by this man who would come to the hotel every day and tip me more than what a cup of coffee costs. He carried a stack of cash with him. He really liked me and I took the opportunity to ask him what he was doing for a living. I could not believe that he owned a salon in Soweto,” says Makhatho.

Gule agreed to take him to see what he was doing better than other hairdressers in Soweto. On that day, Makhatho got himself a temporary job as a shampooist at Gule’s Blackwave salon. Soon after, in 1983, he was a full-time hairdresser and had resigned from the hotel.

“At the salon there were always long queues of people who wanted their heads done. That’s when I started realizing why this man was making so much money from the business,” recalls Makhatho.

A year later, Makhatho resigned from Blackwave to start his own small salon. He had some knowledge of the business and a certificate in hairdressing.

From the years of blow waves, he saved around $700; the capital he needed for his backyard salon in Soweto. But it did not pay off and he had to crawl back to Gule to ask for his old job.

“To start a hair salon at that time was easy; you needed at least a small shelter, some start-up equipment and some money. But keeping clients was a challenge. I was ambitious and made a mistake of not planning properly,” he says.

A married and mature Makhatho resigned again and left Johannesburg for QwaQwa, in the east of South Africa, to open a salon on April 16, 1984, a date close to his heart. This was make or break.

At the time, Makhatho was selling women’s clothing door-to-door. His wife Thandeka, a teacher, joined the salon business and in four years they had six branches and $29,500 in the bank.

“We opened new salons every few months for four years,” says Makhatho.

The salons generated enough money to open a cosmetics distributor, Jabula Cosmetics, supplying hair products around the Free State.

But the rapid growth made it difficult for the Makhathos to control the operation.

“We could not manage the business from a distance, so we had to close the other branches and go back to the original salon.”

In 1993, Makhatho ventured into the supermarket sector and opened the first Bibi Cash & Carry store. A second store was opened and two other bigger supermarkets followed in 2005.

His eldest daughter, Nwabisa, unwittingly lent the name. Her younger brother, Setjaba, called her Bibi. Makhatho thought if a toddler could say it, surely everyone could remember it.

“When we did our financial year-end projection for 2006/7, we realized the last two stores wouldn’t pull through, so we closed them down. We closed down an asset worth $1.78 million with view of coming back,” he explains.

From the profits of the two supermarkets the Makhathos opened two more stores in 2009 and 2010, respectively. Then, two years down the line, the first Johannesburg supermarket was opened with a second due in April.

“Why should I keep my money in the bank, I am a hardened entrepreneur, money needs be invested back into the business to grow. It is safer in the business than in the bank,” asserts Makhatho.

The family owns six supermarkets employing more than 800 people. There are 32 Bibi Express stores in the Free State.

Makhatho thinks people overlook retail.

“People need to understand if you want to be successful in life, you must be the best in what you do. I had the experience of being ignored by many as soon as they realized I am in the supermarket business. Once people hear you are in the mining business they give you respect no matter what,” Makhatho explains.

Makhatho is a firm believer in the power of aggressive advertising. He says competition in retail is interesting if you play your cards right.

“You should not shy away from competing with the established national supermarkets because there is a big market out there. I will never put my shop alone. I want it next to those supermarkets and bombard customers with advertising flyers and banners. That is guerrilla marketing.”

This success allowed him to buy a massive home in the luxurious Houghton Estate in Johannesburg and win the 2013 Sanlam/Business Partners Entrepreneur of the Year award.

“Awards are recognitions from the people who have been observing what you are doing all along. They get you inspired to do more and more of what you are being recognized for,” says Makhatho.

Makhatho’s son Setjaba joined the family business as a systems manager, after two years in management at the Southern Sun hotel group.

“I see myself in him. He’s a dreamer like me and highly innovative. With him on board, there’s another guaranteed 30 years in the family business.”

Setjaba has a hospitality management qualification from Switzerland. Of the four children, he is the only one involved in the family business. Nwabisa, lender of the Bibi name, is a teacher.

“In the next 10 years Bibi will be the major player in the FMCG (fast moving consumer goods) retail sector. I will be 65 then. I also consider listing as an option to raise more money. I still have energy to continue, even Setjaba can’t keep up with me,” he jokes.

All this thanks to a little curiosity over a cup of coffee.

Sign Up for Our Newsletter Daily Update

Get the best of Forbes Africa sent straight to your inbox with breaking business news, insights and updates from experts across the continent.
Get this delivered to your inbox, and more info about about our products and services. By signing up for newsletters, you are agreeing to our Terms of Use and Privacy Policy.
Related Topics: #February 2014, #hairdressing, #millionaire, #mints, #selling clothes, #Tommy Makhatho.