From zero to R3 billion in a South African market which did not exist before

GG Alcock helped build a R3 billion-a-year business for Parmalat in cheese slices for townships, a market that did not exist before.

Alcock is a South African entrepreneur, author, and economic activist renowned for his deep insights into the country’s informal and township economies.

He is best known for demystifying township markets and advocating for the recognition of informal entrepreneurs as vital drivers of economic growth.

In a recent The Common Sense podcast, he shared a story of how he helped Parmalat to build a R3 billion business selling cheese slices in townships.

Parmalat approached Alcock’s agency, Minanawe Marketing, to assist them in selling individually plastic-wrapped cheese slices in the township school lunchbox market.

He explained that, at the time, cheese was virtually non-existent in the township market as it was very expensive.

“In fact, rich black kids were called ‘cheese boys’ or ‘cheese girls’ because only rich black kids got cheese,” he said.

The original strategy was misguided, as schoolchildren in the townships did not receive lunchboxes like their counterparts in white communities.

Instead, they received pocket money, where they bought street-food sandwiches and vetkoek from ladies in the schoolyard.

So, instead of targeting the school lunchbox market, Alcock recommended entering the township sandwich and vetkoek market.

When placed inside a hot, freshly assembled sandwich or vetkoek, an individually wrapped cheese slice melts perfectly.

Apart from binding the ingredients together and elevating the eating experience, cheese slices were also much better than blocks of cheese.

Micro-food businesses, like those serving children, didn’t want to buy large blocks of cheddar because they couldn’t manage portion control or hygiene.

A pre-sliced, individually wrapped cheese slice gave them the cost control and hygiene safety they needed to add the product to their offering.

The strategy of marketing the cheese slices directly to fast-food vendors rather than household moms was a success.

Parmalat cheese slices became a premium add-on choice for township sandwiches and vetkoek at most vendors.

“Through that, we built a R3 billion business for Parmalat in cheese slices going into townships, in a market that really never existed before,” he said.

It was such a success that it changed how South African fast-moving consumer goods (FMCG) manufacturers view route-to-market pipelines.

It also showed that the township market was much bigger than what most companies realised. This, in turn, sparked a push into the market by many top manufacturers.

A recent Parmalat cheese slice campaign