Question NW1355 to the Minister of Small Business Development

Reply:

1. The agency of the Department of Small Business Development (DSBD) – Small Enterprise Development Agency (Seda), via its technology programme which is in charge of the Incubation rollout nationally, focuses only on township and rural areas in terms of establishing new incubators. This will assist in the expansion of Seda’s footprint in both rural and township communities. Below is a graphical presentation of the new incubators that are to be established and their respective provinces/locations.

Seda has by far the biggest network of offices in the country, with 53 branches and 56 co- location points. Seda’s Co-locations are specifically established to extend access to the Small Business Development Portfolio (DSBD and its agencies, Seda and sefa) services in underserviced and rural South Africa. SBD Portfolio has also realised that there are still a number of areas where entrepreneurs and SMMEs still have to travel far for them to access services. As such, through Seda, 58 service points or access points were established during the 2022/23 financial year. The agency also employes alternative mechanisms for ensuring that services are available, such as mobile offices. A Business Development Services mapping exercise has been undertaken to identify other stakeholders that are also providing similar services to establish partnerships with them and offer services on the agency’s behalf. Information is also provided through DSBD, Seda and sefa websites and contact centers. Where possible, Seda also provides virtual interaction with those clients that can attend online training and webinars.

(2) Seda has been prioritising support to SMMEs and Cooperatives with dedicated programmes to ensure that the desired impact is realised. Amongst the dedicated programmes are the following:

The Township and Rural Entrepreneurship Pogramme (TREP) targets specific sectors and/or types of business that are to be provided with both financial and non-financial support. The support offered is tailored per targeted sector to try and ensure the best opportunities for sustainability and growth. The Sectors/business types are Artisans, Automotive businesses, Bakeries & Confectionaries, Clothing & Textile, Personal Care, Retail (including restaurants, car washes, general dealers etc.) and Tshisanyama and Cooked Food. Seda, has provided 22 233 skills development and other business development support interventions for township and rural businesses which also include interventions such as Financial Management training, Point of Sale Training, Access to funding, Basic Business skills training, Information and Business Advice, Business Plans, Training and Mentoring etc.

Seda has a dedicated programme, The Basic Entrepreneurship Skills Development (BESD) which was jointly developed by Seda and German Federal Ministry for Economic Cooperation and Development via Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) since 2012. The programme is funded by the National Skills Fund for an amount of R84 million. The BESD approach utilises coaching as an innovative methodology to facilitate and reinforce learning and development support to emerging entrepreneurs.

Seda has an Entrepreneurship in Schools Programme that encourages learners to consider entrepreneurship as an alternative career to employment. The main objective of the programme is:

• To influence the mind set of learners by encouraging them to become job creators instead of job seekers once they leave the schooling system.
• To equip learners with entrepreneurial knowledge and skills needed to start and manage their businesses; and
• To improve entrepreneurial activity amongst the learners and educators.

Entrepreneurship in Schools (Step up to a Start Up) is a Programme together with Primestars that will support educators through Boot camps to create entrepreneurship awareness amongst the youth and educators. To date, Seda has supported 13 190 student beneficiaries.

The Enterprise Coaching programme is one of Seda’s flagship programmes aimed at developing and enhancing the competencies of business owners by providing them with knowledge, skills and tools needed to grow their businesses. It is a 10-month coaching programme. Coaching sessions include topics such as financial assistance, self-aware mastery, social marketing strategies, financial management and debt counselling, the dtic incentives, worker’s motivation, productivity, best practices in business. Successful entrepreneurs were invited to share challenges, successes of running a successful business, for example, in the manufacturing sector. A total of 159 enterprises were supported in the 2022/23 financial year. All of the supported enterprises recorded an increase in turnover and more than 374 jobs created.

Seda through its Learning Academy has also developed different training programmes. These programmes are credit bearing and accredited by the Services Seta. Quality training aims to assist organisations of all types to implement and operate the Quality Management System (QMS) to increase effectiveness, consistency, and customer satisfaction, explain the benefits of implementing QMS and understand the quality, management principles. Whilst Food safety introduces Food Safety, Understand Pre-Requisite programme, HACCP (Hazard Analysis, Critical, Control, Point) system and HACCP principles and Implementing a Food Safety Management System.

Clients are also supported with access to Local markets through Pop-Up Markets in collaboration with our strategic partners. Following are a few recent examples:

• Seda Namakwa Branch conducted their Pop-Up market from 28th of February 2023 to 1st of March 2023 where various clients exhibited their products and services. Eighteen (18) Exhibitors were in attendance.
• Seda ZFM Branch hosted the Pop-Up Market from 2nd to 3rd of March 2023 in Upington.
• The Nkangala Branch held a Pop-up market on the 17th of March 2023, in Delmas, and 25 SMMEs exhibited their products and services in partnership with Victor Khanye Local Municipality and Standard Bank.
• Seda Limpopo hosted a Pop-Up market in collaboration with the Groblersdal Mall in February 2023.
• The Mopani Branch in conjunction with the district and local municipalities hosted two (2) Popup markets and one (1) in Waterberg on 31st of March 2023.
• The SBD Portfolio in Limpopo, in collaboration with Exxaro, hosted a three-day Mall Activation at Lephalale Mall from the 24th to the 26th of March 2023. Twenty-two (22) local entrepreneurs from the manufacturing, arts & craft, agriculture, and service sector participated in the exhibition.
• Pop-Up markets were held in the Brits Mall with ten (10) SMMEs and Letlhabile Mall with fifteen (15) SMMEs exhibiting. Both events were held on the 31st of March 2023 ending on 1st April 2023.

Seda’s Export Development Programme (Trade Facilitation /Promotion) aims to contribute to the creation of a dynamic and successful SMME sector in South Africa by facilitating an improvement in the sector’s international competitiveness. Priority was given to enterprises owned by previously disadvantaged individuals. Missions and exhibitions that Seda participates in are determined by the Department, in line with government’s strategy.

The SheTrades programme is a partnership between the International Trade Centre (ITC), DSBD and Seda to promote Women’s Entrepreneurship. ITC SheTrades has set up a Hub in South Africa in order to help South African women entrepreneurs increase their international competitiveness and connect to national, regional and global markets through the SheTradesZA Hub. The primary objective of the Hub is to connect at least 10 000 women owned businesses to markets by 2024. This is part of South Africa’s contribution to ITC's goal of connecting three million women entrepreneurs to markets by 2023. Through the programme, women-owned businesses will be able to:

• Connect to potential buyers, investors, suppliers, business support organizations and SheTrades partners.
• Learn skills to boost business potential through free e-learning courses, on-site workshops and webinars.
• Receive support to attend national, regional, and international trade fairs.
• Get chances to participate in B2B meetings.
• Access to investment opportunities.
• Increased visibility and larger network in international markets.

A total of 3004 women have registered as at the end of March 2023.

A partnership between Seda, GIBBS and the Cherie Blair Foundation for Women was forged. The Cherie Blair Foundation has an award-winning Mobile App that offers women entrepreneurs essential business training and support on the go. It features a range of learning tracks on topics including launching a business, accessing finance, expanding market access, e-commerce and mobile money.

• Seda practitioners have been trained on the HerVenture App to assist clients.
• Preparations are underway to create more awareness of the programme.
• Access to information on Research Publications that is now made available to entrepreneurs.
• Entrepreneurs are sharing their best practices.
• Training sessions for specific areas of interest by SMMEs have indicated the importance of the APP and the acceptance as well as the participation in the training.
• The APP has indicated that it is an influencer to competition amongst the users.

Supplier Development Programme is aimed at strengthening the performance of supplier firms by enabling them to acquire the skills and capacities required to make them globally competitive. The programme attempts to raise awareness on opportunities available to supply to corporates and state-owned enterprises. Through the programme and partnerships many of Seda clients secure contracts with mines and large retail companies such as Anglo, Pick n Pay, SPAR, SAPPI, to supply their goods and services and register as suppliers on their databases.

Manufacturing Support Programme responds to the specific current challenges, needs, skills and capabilities of the country’s SMMEs in the manufacturing sector, while at the same time charting a path to assist SMME manufacturers to be competitive. Typical interventions include quality training, implementation of quality systems, product certification and testing, etc. These interventions help clients to also gain access to local and international markets. Seda is also rolling out an Access Point programme to improve access to Seda services by SMMEs.

The Small Enterprise Finance Agency (sefa) as a development finance institution acknowledges the importance of long-term sustainability of small businesses as they are important in reducing inequality, poverty and unemployment. Through its financing programme, sefa is enabling SMMEs to expand and grow. As part of post-investment support services small business are provided with mentoring and business support. During the quarter 4 of the 2022/23 financial year, sefa initiated a business diagnostic project with 144 clients funded under the Township Rural Entrepreneurship Programme (TREP). The diagnoses conducted focused on the following:

• Owner capability and shortcomings,
• Financial sustainability focusing on development of financial discipline, financial planning and profitability of the business.
• Efficient utilisation of Human capital/resources,
• Efficient and effective operational systems,
• Creating sustainable market share,
• Technical know-how and looking at possible improvements and systems.

The diagnostic results indicate the following:

• Load shedding is affecting most of the businesses.
• No financial systems in place as most of them are not recording their business transactions.
• Most businesses have no clear market.
• Some of the businesses are poorly located, impacting their ability to attract new markets.

sefa continually works with its clients to understand their challenges as to better support these businesses in growing the South African economy. Business support and mentoring are essential ingredients that add value to SMMEs and ensure their continued growth and sustainability in these trying economic times.