The Fridge Factory

This case study examines the operational challenges faced by Palfridge Limited, a manufacturer of camping, domestic, commercial, and solar refrigerators. The company struggles with customs inefficiencies at the border between South Africa and Swaziland, high electricity costs and instability, trade policy barriers regarding EU imports and Zimbabwean exports, and the loss of skilled local labor to the South African market.

• Palfridge Limited faces significant customs delays and financial penalties due to the use of incompatible customs systems by the South African Revenue Services (SARS), which uses EDI, and the Swaziland Revenue Authority (SRA), which uses ASYCUDA. These discrepancies lead to frequent form errors, fines of up to R10,000, and shipments being delayed at the border for up to three days.
• High electricity rates and frequent power disruptions increase the cost of doing business and cause uncompensated damage to company machinery. This situation was further exacerbated by a recent sales tax increase that now includes electricity.
• Trade policy failures result in higher production costs and lost revenue. Because Swaziland has not ratified the interim Economic Partnership Agreement with the European Union, Palfridge pays higher duties on components like specialized copper tubing from Italy compared to South African competitors. Additionally, the company has been barred from the Zimbabwean market for over 18 months due to disputes over rules of origin.
• The company struggles with a 'brain drain' of skilled labor. While Palfridge reduced its expatriate staff from twelve to three by training local Swazi talent, it cannot retain these workers because they are offered better compensation packages in South Africa.
• Despite engaging with the Ministry of Commerce, Industry and Trade in Swaziland and the Zimbabwean ministry responsible for trade, Palfridge has seen no positive results. The company has not attempted to engage policymakers at the regional level.

APA

South African Institute of International Affairs (2012). The Fridge Factory. https://saiia.org.za/saiia-toolkit/the-fridge-factory/

Chicago

South African Institute of International Affairs. The Fridge Factory. 2012. https://saiia.org.za/saiia-toolkit/the-fridge-factory/.

Wikipedia

{{cite report |author=South African Institute of International Affairs |title=The Fridge Factory |date=24 July 2012 |url=https://saiia.org.za/saiia-toolkit/the-fridge-factory/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{southafricaninstituteofinternationalaffairs2012fridge, author = {{South African Institute of International Affairs}}, title = {{The Fridge Factory}}, institution = {South African Institute of International Affairs}, year = {2012}, month = jul, url = {https://saiia.org.za/saiia-toolkit/the-fridge-factory/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }