The new settlement trades out of necessity with the neighboring Khoikhoi, but theirs is not a friendly relationship, and the company authorities have made deliberate attempts to restrict contact.

Partly as a consequence, VOC employees find themselves faced with a labor shortage.

To remedy this, they release a small number of Dutch from their contracts and permit them to establish farms, with which they are to supply the VOC settlement from their harvests.

This arrangement has proven highly successful, producing abundant supplies of fruit, vegetables, wheat, and wine; they also later raise livestock.

The small initial group of free burghers, as these farmers are known, has steadily increased in number and have begun to expand their farms further north and east into the territory of the Khoikhoi.

In addition to establishing the free burgher system, van Riebeeck and the VOC have also begun to import large numbers of enslaved people, primarily from Madagascar and Indonesia.

These slaves will often marry Dutch settlers, and their descendants will become known as the Cape Coloureds and the Cape Malays.