An investment in young people and community pays off for burial magnate Ratau Mphahlele

Funeral parlour owner, Ratau Mphahlele, began his business in 2016 after severing a partnership that had gone sour. This business divorce forced him to start his business again from scratch.

Left with one car prior to owning a fleet of 15 vehicles, Mphahlele was left with no choice but to begin working furiously on his brand, Baroka Funerals. Today, the company has 50 vehicles in its fleet, an annual turnover of over R80million and over 20?000 monthly paying members of his burial scheme.

As he was rebuilding the business, COVID-19 hit and he found himself in a position where he had to radically change the product that they were offering to keep up with the demand.

“We appointed a guy who used to be the MD of Hollard Life in Mozambique. We poached the best person from a multinational and he helped us to change the business to where we are now. He brought structure and order and we now operate like a corporate company, but the difference is that we operate from the heart and with the people in mind”.

Investing in youth

The structure has helped the company build a long term view.? With an aim to build a sustainable business, Mphahlele took a 40-year strategic approach to ensure that the business will still be there 100 years from now. And to do that they took a decision to hire and upskill young people. The average age of his 200 workers in 28 years.

“That has been a real game changer. Young people have energy and they have vision. We push them to study and we are preparing them to take over this business. Succession planning is key in building a lasting business and we are continuously working on measures that will ensure staff retention and personal development”.

Mphahlele proudly mentions that they provide provident funding for their employees as well as a medical aid scheme fully paid for by the company. “We also introduced a car scheme in partnership with the Haval Group”.

“We encourage our employees to finance a car and guarantee them that the car will be paid every month. We guarantee that car insurance will be paid and we use the vehicle every weekend. When we go to funerals, all that we need is that the car is branded. These are the basic things that we are doing as a business to say we need to take care of our people in order for them to take care of us. I'm investing in young people so that this business can exist beyond me in the next 10 years”.

But it hasn’t always been smooth sailing for this entrepreneur and his business. They once faced liquidation over R10million that was owed to underwriters. This was when his investment in people paid off.

“We had 90 days to turn the business around so that it is was able to meet its repayment obligations over and above other operating expenses. Every staff member from cleaner to CEO pulled together, worked overtime, drove cards, arranged flowers in a bid to lower costs so we could make the turn that we needed for our business”.

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The Alignment of greed

“We have a rule that everybody shall eat from the pot. We call it the alignment of greed. Sometimes as business people we make the mistake of thinking we are the only people who are ambitious yet each person in here has an ambition. Each person has a dream and we want to help our people achieve their dreams”.

He incentivizes his teams with shared financial rewards for paying claims within the hour – ensuring that the teams work together to assist clients during their time of need. The principle here being that if the business make money, all will make money.

“We need to get away from the perception that if you are doing extremely well then you have no problems. At Baroka, we do not hide our financials from our staff. Everybody in our team has access to our financials and knows where the company stands. We all work together to achieve our targets for the growth of the company. It is important that everyone understands what is happening in the business. It makes running the business easier”.

It's all about the culture

Baroka pride themselves on providing an inclusive culture regardless of the position in the organization. Mphahlele emphasized, "We run a flat organizational structure which encourages all to get involved when hands on deck are needed. The executives, cleaners, office workers realize that they are all in the same boat and we work with mind and heart to keep the business open".

On investing in community

Understanding that community is their business, Baroka established a foundation called Baroka Cares. Here they focus on the basic needs of children like providing school uniforms, clothing and food. They also assist the youth by providing them with the 18 month in service training required by TVET colleges in order for them to receive their certification.

“We are able to really take care of the youth and see to it that they are there and part of our feeder system. It can be only them who build up institutions that will be there in the future like that. We need to look 100 years later and say wow, even this one comes from our dirty Township” Mphahlele concluded.