Fall 2015
South African Crafts Market Reinvents Itself to Draw Both Locals & Tourists

Curated vendors and an eye to “impact investment” are the keys to success for Cape Town’s Watershed.

A great deal can happen in five years, especially in South Africa where government and public enterprise are laser-focused on redevelopment, employment, economic opportunities for the poor and managing the growth of tourism. And that is where this story begins, on the working wharfs at the waterfront in
Cape Town.

Since 2009 the Victoria and Alfred Waterfront, a retail development in Cape Town at the foot of famous Table Mountain has focused its energies on African entrepreneurship. During a previous visit (see the 2009 SRR article The Craft Market: The Story of Social Entrepreneurship), the Blue Shed Craft Market was a success story in its own right. The Shed was an old ship restoration building repurposed and teaming with entrepreneurs and craftspeople—most of whom were self-employed artisans making their way out of poverty by manufacturing and selling their wares there. Today it has been renovated, launched and renamed The Watershed. It is merchandised and leased to a highly curated South African and African-only product mix that just about takes your breath away.

For the consumer, this change is a momentous transition. The Watershed is a place where you become engaged in the shopping experience, inspired by the owners, and at the end of the day, you feel good about what you have purchased because of its impact within the South African community. It is a place where every single retailer has a story.

Platform for specialty retailers

The V & A Waterfront has always been committed to providing a platform for small business and specialty retailers. But they recognized the previous Blue Shed Craft Market and Wellness Center had outgrown its space—and time had come for not only a physical refurbishment, but also to reimagine the entire offering. Ongoing market research revealed that The Blue Shed was generally perceived by locals to be only for tourists and was overpriced. With a 50-million rand investment from its new owners, Growthpoint Properties Limited and The Government Employees Pension Fund represented by the Public Investment Corporation, LTD (owners since 2009), they were able to take this dynamic business environment to a new level.

e-Stall-shot-1“This has been a very positive move,” said Jill Heyes, Founder, and owner of Original T-Bag Designs an operator at the waterfront for 13 years. “We did very well in The Blue Shed, but our sales have improved dramatically. We were apparently the best seller in November [2014]. I was very nervous at the transition, but extremely happy with our beautiful shop and position,” Heyes said. Original T-Bag Designs is a completely unique type of craft making, creating handmade greeting cards, textiles and artwork from recycled tea bags. “People love the quality, but also the recycling aspect as well as our desire to change the lives of our team of 19 [members of the Imizamo Yethu community], through a good wage, skills training and empowerment,” Heyes said.

The property had experienced a 19 percent increase in sales in 2014, marking four consecutive years of
consistent growth.

“A proposed business innovation hub was the catalyst for The Watershed project, which presented the opportunity to re-imagine the existing Craft Market and Wellness Centre,” explained V & A Waterfront CEO, David Green. “We needed to re-engage with the locals and change the perception that The Blue Shed catered only to tourists,” he adds. At the same time, the Waterfront was looking for a way to invest in the development of emerging small retail enterprises and giving back to the public. Green describes the focus of this redevelopment as “impact investing,” which intentionally drives social and environmental impact alongside
financial returns.

Success breeds success

DSC03741The reimagining of the existing Blue Shed and Craft Market was as much a drastic external renovation as it was an evolution of changing up product offerings and merchandise assortment. It had been well established as an enterprise development platform for craft entrepreneurs and traders who would manufacture and sell on-site. The owners sought an opportunity to broaden the craft offering, improve the Wellness Center and establish event space. The V & A management looked at this renovation as a total reimagining of not only the retail space and offering in The Blue Shed, but an incorporation of a co-working hub. “The result is a multifunctional space that combines the business innovation hub with a ‘market’-type space for small-scale retailers on the ground floor, and a multitude of other public spaces with related and supporting uses on the second floor,” says Shannon Clarke, a 13-year veteran of the Waterfront and small business development manager.

Trevyn McGowen, partner in Source, a Cape Town export firm, and her team were tasked with assisting in developing the best possible tenant list and identifying how to activate the space. McGowen, a formidable player in South Africa’s design scene, plays a pivotal role in promoting and bringing South African design to the global marketplace. She and her staff worked alongside the marketplace team, which includes Clarke. Each tenant was hand-picked. Product assortment, presentation, display, signage, space requirements and potential for workshops and live performances all factored into their selection.

During the renovation and redevelopment period, V & A management erected a semi-permanent tent where traders operated. According to Clarke, “It presented an opportunity for the businesses to critically evaluate their ability to operate ahead of the opening for the renovated market as space was limited and retailers had to refocus their merchandise,” she said.

Architect Heinrich Wolff, of Wolff Architects who designed the new building describes it as “fundamentally making a city and not a building.” The new shed includes an exhibition hall and a business “innovation hub” on the upper levels that incorporates a Wellness Center. Wolff adds, “This is not a building in the conventional sense, but a ‘network’ defined by dense and diverse activity and human interaction. People are drawn into this building for a variety of reasons and are simultaneously pulled into an unexpected urban life where accidental meetings take place.”

The newly opened space, takes its name from an “a-ha moment” where, according to Wolff, “You feel excited, elated, motivated and it changes your life; even in the smallest ways.” A “watershed moment” has meant a dividing line, often a moment in time marking a significant transition producing profound effects. From The Blue Shed to The Watershed, there’s no doubt about the owner’s intent.

Core goal is realized

a-Main-Walkway-1Approximately 8,000 to 10,000 people traverse through The Watershed daily, as it is the gateway to the main V & A Waterfront, which includes over 450 restaurants, retailers, an aquarium and hotel. While it remains South Africa’s favorite attraction, visits by locals have increased to 63 percent. Like all urban marketplace centers, the challenge is to remain relevant to the local community. Visitors want to go where the locals go. The V & A Waterfront has carefully curated the retail and leisure attractions to cater to these distinctly different audiences.

Much of the operating terms for retailers and craftsmen in The Watershed remained the same. The majority of leases are one year in length though some of the anchor tenants were given options to renew due to their storefront investments. Each business works closely with the small business management team, and the tenant’s growth and development is measured and marked with quarterly meetings where they discuss the possibility of expansion and moving up and into the traditional retail space at The Waterfront.

Clarke and her team have initiated a “Good Night Market” on the last Wednesday of each month at The Watershed where they add additional food, bar facilities and entertainment to drive awareness and activate the space.

The newly created Watershed is not only a space where one can take home a piece of Africa from one of its 130 merchants, but it is an experience that stimulates a question about why no one has tried this in the United States, given the robust industry of regional crafters and designers.

For more information, visit Waterfront.co.za/Shop/watershed.

Duffy C. Weir

Duffy Weir is the former vice president and director of specialty retail and marketing at The Rouse Company of Columbia, MD. Now an independent retail marketing and sponsorship consultant and writer, Weir travels the world searching for what she says "makes marketplaces tick." She can be reached at Duffyllc@comcast.net or 410.252.8885.
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