Business is booming at Dan Watson's Outfitters in the main street of this port city on South Africa's Indian Ocean coast. The store was packed with black customers and Watson, a genial, fresh-faced young white man with a football player's build, was saying as he served them that he reckons his turnover has more than doubled in the past month.

Across the street, meanwhile, the shutters have just gone up at a butcher shop called Meat World. At least 20 other Port Elizabeth businesses have closed. According to a survey, every shop in the city, with the single exception of Watson's, has suffered losses of between 30 percent and 100 percent since mid-July.

That was when the militant blacks of this eastern Cape Province region, who have been at the center of South Africa's year-long rebellion against the apartheid system of white-minority rule, began a massive consumer boycott as their latest act of political protest.

As the boycott began, the organizing committee called on Watson to tell him and his three brothers that their chain of four stores in Port Elizabeth and nearby Uitenhage would be exempted.

The exemption is in recognition of an antiapartheid gesture they made nine years ago. The Watson brothers, all enthusiastic rugby players, quit their whites-only club and began playing for black clubs in the segregated townships.

The boycott has been a way of bringing the black protest campaign out of the segregated townships and sharply to the attention of whites. Port Elizabeth's white business community has been jolted into a new awareness of black grievances. John Malcomess, a member of Parliament for the opposition Progressive Federal Party, says he has had more telephone calls from traders pleading with him to pressure the government into making political concessions to end the boycott than on any other issue during his 10-year parliamentary career.

The Watsons made their gesture before the administrators of South African rugby began integrating the sport in the face of threatened international isolation because of their segregationist practices, and the Watsons paid a heavy price for their action. The white rugby union expelled them. They were shunned by friends and former teammates; they received death threats. Whites stopped buying at their stores.

For a time the government prohibited them from entering the townships where their black club played its matches. But the Watsons hid in the trunks of automobiles, stowed away in delivery trucks and covered their faces with knitted hoods to evade the police and reach matches in the the townships.

What they lost in rejection by white Port Elizabeth, they gained in acceptance by the township people of KwaZekele, Zwide and New Brighton, where they became heroes and drawing cards on the rugby fields.

The Watsons are now enjoying a massive cash benefit from their action. Exemption from the boycott has meant more than just immunity from its crippling effects. It has meant an explosion of new business as nearly all clothing purchases by the two cities' 300,000 black inhabitants are made at the four Watson stores.

The stores' green shopping bags, bearing the slogan "Dan Watson -- the people's outfitters," are passports for safe entry to the townships. A black person seen returning home carrying any other shopping bag may be questioned by boycott pickets. Breaching the boycott can lead to some rough, arbitrary justice in these times.

For the Watsons, their exemption by the black boycotters has meant renewed harassment and threatening phone calls. The other day, Watson said, a police officer called to question him about his relationship with the boycott organizers and to warn him that he might be charged with aiding the black protest campaigners.

"We've had hundreds of police enter the shops and just stand around, knowing the blacks won't come in while they're here," Watson said.

His best safeguard against what he says is official harassment, Watson said, is to publicize what is done to him. Watson said that when two policemen stationed themselves at the entrance to his main store recently -- in what he believes was an attempt to inhibit black customers from entering -- he threatened to telephone an international television agency.

"If you guys aren't gone in 10 minutes," he said he told the policemen, "you'll be on every TV screen around the world." They left soon after, he said.

Dan Watson, the youngest of the brothers, sacrificed heavily in making his commitment across the color line. In the important world of South African rugby football, he was a rising star. After his first season, he was among 30 finalists for a national team to tour France.

A national selector came to the store to tell Watson, then 21, that if he would abandon his provocative involvement with the black players, he was a certainty for the team, according to Watson.

To represent South Africa in an international series of rugby is to ensure one's place in the pantheon of national heroes. It is not something a 21-year-old would find easy to turn down.

"Cheeky" Watson, as he is called, seems an improbable candidate for political sacrifice. He is no intellectual idealist. At 190 pounds he is square and strong, with clear eyes and uncomplicated talk. What distinguishes him from other white South African rugby players is that he feels passionately about racism.

For that, Watson says, he thanks his parents. His father was a preacher in the Pentecostalist faith, and the Watson boys were brought up to believe in a literal Christianity that commanded that one should love one's neighbor -- which meant the black Xhosa tribespeople in eastern Cape Province.

Cheeky Watson thought little of politics when he and his brothers set up shop in Port Elizabeth, but when a group of black rugby players asked him to coach their team, it seemed natural to accept. Watson said he was appalled at their playing conditions in KwaZekele township. One evening he took the team for a practice workout at his whites-only Crusaders club. The next day the club president called at his shop to tell him never to do such a thing again. That, Watson said, was when he resigned and joined a black club.