The consortium of investors – including ex-Exclusive Books CEO Benjamin Trisk – that bought the CNA stationery chain from its parent company Edcon in February this year, inked the deal just days before the Covid-19 lockdown commenced.
Trisk, who has taken the reins as CEO of the business, which currently operates 165 stores, gave this wide-ranging interview to The Reading List’s Ben Williams. Learn how Trisk intends to future-proof the business – while also injecting some bookselling flair into its branches – by emphasising education and technology.
Ben Williams: My first question is really the same as your friend at the gym who asked, when you told him you were buying CNA, “Are you mad?” I’ll take that the answer is “no”, but what was it like to close the deal on a big retail operation just as the pandemic hit? Did you spend any days in the office before lockdown?
Benjamin Trisk: No. I spent not a single day in the office, it was really quite weird. But remember I’d lived with the deal for two years, so by the time the pandemic came along, we were, as Shakespeare would have said about Macbeth, “in blood so far”. To go back was as hard as to go on. The deal had some transformations. I did the deal on February 3rd, signed the transaction. There was no lockdown. Then, when the rumors of lockdown started, Edcon indicated to us that we may not be able to do this deal because, not only was lockdown coming, but Edcon’s own sales had fallen off a cliff. They had no more working capital runway, and the likelihood was that they would have to go into business rescue. We then, in the space of about three days, re-engineered the deal. So we took it, knowing the state of the business, knowing that there was no revenue at all, knowing that the stock had been badly run down. We took it so that it would not go into business rescue, and we would be able to save the jobs, which was a key thing for everyone, as you can imagine. So that’s how it happened.
BW: What did you do when the lockdown started easing?
BT: I opened a few stores. I can tell you now, we opened, I think, three or four stores, around the 20th of April, because you were allowed to sell magazines. I think we took about R8,000 through the tills. That was our first day’s trading.
BW: That’s a very tough first day. But that leads me to another question: post-lockdown, what’s trading looking like?
BT: It’s still very weak. I’ve got an interesting metric. You know, I always get hooked on these arcane details that no one else seems to. So, my metric for the business at the moment, every day, is – how many whiteboard markers am I selling? And the reason’s quite simple. I’m selling about 25% of what I did the same day last year. Which means that people have not come back to the office. If people were in the office, they’d be using whiteboards, and we’re not selling whiteboard markers. So that tells you, at 25% of last year, people are just not at the office. Some of the major banks are saying they’re not going back until next year. My son, who’s a lawyer at Bowman’s, I don’t think he’ll go back to the office before next year. This Zoom technology, much as I loathe it, because I’m someone who likes to feel the pulse in a room, it’s how we have to run business now.
BW: You’ve had the keys for the business for a little over a hundred days, the conventional time it requires a leader to get to know a business, and so what have the first hundred days in the saddle, in this most unusual time, been like?
BT: When we got the business, and my management team were on board – engaged, embroiled – I said to them, “Every decision you make, make a note of it. Because one day we’ll write the story of how we took a brand that was basically the subject of wife abuse and we made it great again.” What I didn’t understand then, which was a total revelation to me, was how many really good, competent people there were in the CNA head office. And there were plenty, and there are plenty. But they weren’t at the executive level. At that level, of the eight executives in CNA, there’s one left. And there’s this strata of really solid, numbers-driven people underneath. They’re technologically driven, they don’t necessarily have retail flair, but they weren’t employed because they had retail flair.
So, you’ve got to ask yourself, with a coterie of people like this, how did the business get into this state? And it got into that state, not because there were incompetent people above them, necessarily, but because decisions got made that were not retail decisions. So everything was about Edgars, and Jet, and CNA was really just another lever to take a little more space to get a better rate for the big box retail, regardless of whether the space that you got for CNA was the right space or not, or in the right place.
I’ll give you an example. What I’m seeing more and more is how eurocentric the assessment of CNA and its locational profile has been. The business is broken down into the large regionals, the metro stores, the neighborhood stores, but there’s no reference in the lexicon to earmark stores as to township stores. It’s still about development in what I would call the metro areas. But we need to start looking at Mamelodi, at Soshanguve, and so on, because before anything else, we’re actually a stationery business. And we can’t lose sight of it.
BW: What about the small town that you get when you’re traveling from a centre to a centre? Could you get a CNA in these as well?
BT: Maybe, in some cases. This last January, I drove up to Joburg from Plettenberg Bay. I didn’t take the national road through to Bloemfontein, I took the parallel road through Philippolis and Trompsburg. And one of the tragic things I saw is, in far too many of these small dorps, the rates base has disappeared. And if the rates base has disappeared, it means there is just no money in the town whatsoever. So you’ve still got to find all those towns that still have a rates base. So, for instance, if you look at that road from Hermanus all the way through to Knysna, there is a CNA in George, and nothing else at all. So, we’re going to find those opportunities for, probably, smaller stores, and focus on stationery.
BW: You mention CNA as a stationery store, but I’ve heard rumours through the grapevine that bookselling will be more prominent in the retail mix, too – and of course, you’ve assembled a team of executive booksellers, many from your old business, Exclusive Books, to help make that happen. But what does it look like in a CNA?
BT: It’s being done, pretty much, ground up, brand new. We are bringing back African literature for example, and so far it’s been incredibly well received. We started a whole host of webinars, we’ve probably done five or six, and we’ll keep on. So, for instance, we’re doing a webinar on the first book that CNA has published, probably, in 50 years.
BW: CNA has published a book? Tell me about it, what is it?
BT: It’s called, Learning Under Lockdown. It was an idea that was developed by Prof Jonathan Jansen. He asked kids at schools to write short essays of what it’s like to learn under lockdown. And we’ve published it. It’s in the stores.
BW: How much are you charging for it?
BT: R99.95. And the reason it’s R99.95, is because I want to make it accessible to people. And I’m giving all the money that we make on the book to feeding schemes nominated by Jonathan.
BW: So, let me ask you, how does that speak to the vision for CNA in the years ahead?
BT: CNA’s vision, and what’s been my vision, is that I think we can be at the forefront of the learning experience in this country. Whether we are selling books, or we’re selling study guides, or we’re selling the stationery that’s needed. We should be the place that a parent in South Africa wakes up and thinks of when school starts and – “Oh my god, I’ve got to get Johnny a new lunch box.”
BW: Is that the key to reviving the brand? I mean, you’ve mentioned that the brand was in relatively rough shape and the similarity to Exclusive Books is there, in that respect – the Exclusive Books brand was eddying in the doldrums before you came on board to give it a good shake. What’s the key to reviving the CNA brand? Is it the retail footprint?
BT: The key is obviously footprint. But the other part of the key is that retail purchasing has changed. And now the shift that we were waiting for in this country, which started happening, what, 15 years ago in the States, which is the online purchase – that is happening here now, obviously.
BW: Especially now: it’s all being accelerated, isn’t it?
BT: That’s the point. So there’s been this compression of experience into, what, four months? And a lot of stuff is changing. So, CNA has to be an omni-channel marketer, I can tell you that. In two years’ time, we need to be, not only an omni-channel marketer and retailer, but we need to be a tech company that does retail, which is a big ask.
BW: What are the obstacles standing in your way, and who are your biggest competitors? Surely Takealot is one?
BT: Takealot is clearly a competitor, and a good one. But also Shoprite, Checkers – they move mountains of stationery over the back-to-school period. We move nothing like that. So, that’s a huge opportunity for us. There was this whole thing, of course, when I took over, that we were direct competitors to Exclusive Books. We’re not. I don’t have those sorts of skills in the CNA stores, and I don’t want to hold that wonderful, broad, encompassing sweep of literature and non-fiction. I cannot do it, and I don’t have stores of that size. My stores are too big, by the way, at the moment. They need to be smaller.
BW: Are you going to do major refurbishments, like you did at Exclusive Books?
BT: Not refurbishment at that level. I’m busy with the first refurbishment right now, which is going to be at our Mall of Africa store. And it’s very cool. Some great graffiti in the store. A much smarter use of the pillars. Different signage, use of color, those are the things we can change. But, for instance, every CNA store in this country has the same ghastly drab, cream tile. I can’t do anything with those tiles. I’d love to, but it’s just too expensive for me to do that.
BW: 165 stores is a lot.
BT: Correct. So, you’ve got to pick things. We’re looking at possibly – possibly only at this stage, because we haven’t got an agreement – putting our first small coffee shop within a store. Very small. Small coffee counters on the edge of entrances so you can pull traffic through. Very simple processes.
BW: You’ve got your hands on a brand that has a sort of atavistic traction on the retail landscape. CNA was once in every town. It was a brand for the masses, as it were. And one of my questions speaks to that, which is, is one of your plans to take, if you’ll excuse the pun, exclusivity out of bookselling, and fashion something like a people’s bookstore?
BT: So, here is an example. As you know, I’m very involved with the Nal’ibali Trust. And Nal’ibali produces collections of stories in indigenous languages. They’ve done two or three volumes so far, in all eleven languages. We’re going to start boxing those sets and selling them, at a price of say, R49.95, because there is such a huge need for that zero- to six-year-old age group. Once the children start going to school, they’re moving across to English as their mainstream language. If you don’t build that background of reading in the home language, you cut out a major part of their learning experience. You don’t want the parent necessarily reading a story about a hungry caterpillar in English to a four-year-old who’s going to struggle with that language, speaking seSotho, or isiXhosa at home.
BW: Is one of the plans to support more indigenous language publishing?
BT: Of course. It will be a huge part of this business. And that is a market that hasn’t been looked after, but you have to care about it. You have to come to it from a proper teleological background. You can’t just say, “Oh this is a chance to make money.” You’ve got to build the trust. And then, I mean, I’ve always been on this thing about the Big Hairy, Audacious Goal, every company worth its salt has got to have one.
BW: What is it? What’s your BHAG for CNA?
BT: We are not going to pre-empt the market right now. I am working on a document that still has to be approved by my board. Once they agree to the motivation then the next step will be to find the right partners and announce a coherent strategy to the public at large. Right now I think we will be moving forward publicly in March, with the financial and media partners required for this. In my view it is the biggest marketing initiative since the 2010 World Cup.
BW: Let’s go back to bookselling for a moment. CNA, as you’ve said, will be a stationery store first, with an increase in bookselling on some level. But does that look like what it did in the past? Are you interested in expanding the range and kinds of books that are sold in CNA?
BT: I am. And oddly enough, the bestsellers, I mean the John Grishams and so on, are not a big element of the book offering. There’s a lot more African fiction. And I will bring back African classics, as it were – the Ngugi wa Thiong’o’s and so on. And the political section is going to expand – South African politics. We recently took a view on a new book by Jacob Dlamini, which you may have seen. The Terrorist Album.
BW: Yes. In fact, we published an excerpt from it in The Johannesburg Review of Books.
BT: So we took a punt on that. And there are a number of other political books coming through, including Angelo Agrizzi’s book, Inside The Belly of the Beast, published by Melinda Ferguson.
BW: How have the publishers responded to the moves you’ve started making? Are they generally supportive and happy, or not?
BT: They’ve been fantastic, all of them. And I’ve been very touched by it.
BW: Every week the business press runs a story about South Africa’s “retail bloodbath”. The latest one is Cell C closing large numbers of stores. What’s it going to take for retail to thrive? I mean physical retail – bricks and mortar – what do you need to do, following this epoch-defining moment, to survive and to thrive?
BT: I think you’ve got to downsize stores, which is going to be a problem for developers and landlords. And I think you’ve got to know much more about your customer. I don’t think people know enough about their customers. They don’t know what their customer wants. And if you don’t, if it’s hit and miss, you’re going to miss. We have got to be much more focused on the omni-channel. I think where we are, there are probably twenty stores that are surplus to our requirements right now. But there are maybe eighty potential stores that we haven’t yet thought about yet, that we should be doing something with.
BW: So is your ambition to open more stores?
BT: I think if you interview me in two years’ time, you’ll be talking to me about a store footprint that’s in excess of 200 stores. We’re clearly under-represented in a lot of areas.
BW: In the US and the UK, book sales – by which I mean hard copy sales – are roaring back. And independent bookstores and chains alike are getting huge amounts of support from the public. But that’s not happening in South Africa. What is it going to take for the SA environment to be supportive of booksellers again?
BT: I don’t think many of the independent shops can make it. There’s a few that can. So, for instance, as you know, I am a huge admirer of Love Books in Johannesburg. You need very professional approaches to your stock – your stock turn, your cash. Because the trouble with booksellers, and I know from my own experience, I’m always a sucker. I’m not a sucker necessarily for the new title, but I want that backlist. But the backlist sells very slowly. You’ve got to actually understand the metrics and the granularity of your business, and I don’t think many of the indies have the capacity to do this. It’s a tough slog.
BW: Right, last question – what are you reading right now?
BT: A great business book by David Enrich called Dark Towers: Deutsche Bank, Donald Trump, and an Epic Trail of Destruction. It’s fabulous. And then, this is mind blowing: Putin’s People: How the KGB Took Back Russia and Then Took On the West by Catherine Belton, who was the Financial Times correspondent in Moscow. She’s writing pretty much from the inside. And what I love about Putin’s People is learning how Putin runs all of Russia with a gang of about 10 of his old KGB buddies, some of whom have become billionaires because someone said to one of them, “Oh, those two submarines, you can take them, and you can sell them to Kazakhstan, just to get you on your way.” So those are the two books on my bed stand at the moment.
BW: It sounds like you’re having a good time at CNA.
BT: I’m having a good time, and I just love the people I’m working with. CNA store people, they haven’t had a lot of the advantages in life that maybe Exclusive Books store people have had. They’re different, they don’t have that bookstore knowledge, but they’re really good people. It’s thrilling to have so many decent, lovely people in the stores.
BW: Thanks very much for your time and good luck!
BT: Anytime. Thank you. DM/ML
Disclaimer: Ben Williams worked for Benjamin Trisk at Exclusive Books. Visit The Reading List for South African book news, daily.