Establishing an abalone venture in South Africa : a critical review of Aquamart

Norval, Alex (2008-12)

Thesis (MBA (Business Management))--Stellenbosch University, 2008.


ENGLISH ABSTRACT: This report begins with a look at the ever increasing world population and the effect this is having on the world's food production. While the demand is increasing with the rise in population, the supply side is finding it difficult to produce enough food due to a number of pressures. The report then goes further by suggesting a source of food that holds great potential for the future which, if it reaches its full potential, could go a long way in providing a sustainable source of food for the next generation. This source is Aquaculture, which is discussed through a look at both the advantages it provides and the challenges involved within this industry. Furthermore, the report takes an in depth look at a sub-section of the aquaculture industry, namely the farming of abalone, firstly in general, but then also more specifically the farming of abalone in South Africa. Abalone are mostly sold in Asia as a high priced delicacy and occurs naturally off the coast of South Africa, however, due to over fishing and poaching over the past three decades, the South African government has now introduced a total ban on the diving and selling of wild abalone, or as it is commonly known in South Africa, Perlemoen. It is therefore now up to the small number of abalone farms on South Africa's coast to fill the void left in the international abalone market for Haliotis midae. The second half of this report looks at one company in particular, Aquamart, which was a company established in 2003 by 5 MBA students with an ambitious plan of setting up an abalone farming facility. All of Aquamart's aspects are discussed, including its business plan, financials, senior management and its strategy. These areas are then critically reviewed in order to try and establish what Aquamart succeeded in, but also what went wrong, and why the company ultimately had to be closed down in 2005. This report aims to identify some of the barriers within this industry and also for Small and Medium Enterprises (SMEs) in general, which can hopefully be used by future entrepreneurs in order not to repeat the mistakes made by Aquamart.

AFRIKAANSE OPSOMMING: Die verslag begin deur te kyk na die al groeiende wereldbevolking en die druk wat dit plaas op die wereld se voedselvervaardiging. Saam met die druk van die groeiende vraag, is daar ook verskeie eksterne vorme van druk op die aanbod van voedsel. Die verslag gaan verder deur een moontlike bron van voedsel voor te stel wat sal kan help om aan die vraag te voldoen, maar slegs indien dit korrek aangewend word. Die bron is akwakultuur, en die verslag kyk na die industrie se voordele asook na van die uitdagings wat die sukses van die industrie kan beinvloed. Verder ondersoek die verslag oak een van akwakultuur se sub-industriee, naamlik die boer met perlemoen, eers op 'n globale skaal, en dan spesifiek in Suid-Afrika. Die perlemoen wat grotendeels as 'n luukse voedsel op die Asiatiese mark verkoop word kom natuurlik op die kus van Suid-Afrika voor, maar as gevolg van die swak bestuur van die natuurlike hulpbron, gepaard met die onwettige smokkeling van perlemoen, is die natuurlike perlemoen nou 'n bedreigde spesie in Suid-Afrika, en het die land se regering 'n verbod geplaas op die uithaal en verkoop van wilde perlemoen. Dit is dus in die hande van die Suid Afrikaanse perlemoenplase om in die wereld se vraag na H. midae te voorsien. Die tweede helfte van die verslag doen 'n gedetailleerde ondersoek op die maatskappy Aquamart, wat in 2003 gestig was deur 5 MBA studente met die oog om 'n perlemoenplaas in Suid-Afrika op te rig. Die vernaamste aktiwiteite van Aquamart word in die gedeelte bespreek, insluitende, onder andere, die besigheidsplan, finansies, algemene bestuur en Aquamart se besigheidstrategie. Die verslag doen dan 'n kritiese ondersoek op Aquamart om te probeer vasstel hoekom die bestuur in 2005 geforseer was om Aquamart se deure te sluit. Die hoop is om lesse te leer uit Aquamart se mislukking wat kan dien as 'n riglyn vir toekomstige perlemoenboere, asook klein en medium-besighede in die algemeen.

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