Spaza power!

Spaza shop owners save money by working together

  • by Phumzile Ncube
  • Feb 23, 2015
  • 298

Sometimes a simple scheme can make a huge difference to a small business – and save you money.

That’s what happened last year when a group of about 50 spaza shop owners in Gauteng got together and decided rather than buy their stock like baked beans, tinned fish, maize meal and other products on their own, it made more financial sense to buy together, in bulk.
A member of the group takes the orders from the other owners and gives them to the nearest cash-and-carry store. The order is then delivered to the association’s office or to one of the spaza shops, from which the owners collect their goods. Everyone saves, everyone wins.

Says the president of the South African Spaza and Tuckshop Association, Rose Nkoni.

“We benefit because we get a very big discount on goods and the cash-and-carry will deliver. It also benefits the supplier because they get more customers.”

When companies adopt a more inclusive approach to business, they open themselves to contributing to a more sustainable economy and the dismantling of the many socioeconomic problems associated with unemployment and low levels of entrepreneurship.
Moipone Molotsi, director of the Centre for Small Business Development at the University of Johannesburg, says one example of inclusive business is when big business provides “procurement opportunities to small businesses or even their employees in their value chain, coupled with support over an extended period of time until these small businesses or employees are able to supply at the right quality and quantity expected, like trucking”.

When companies adopt a more inclusive approach to business, they open themselves to contributing to a more sustainable economy.

“People are desperate. People want to be part of big business – that’s why they come together. This is the first step for inclusive business. The next step is when one spaza shop owner goes with a truck and fetches the supplies, checks the stock and then employs other people to check the stock and then jobs are provided. Or maybe one spaza shop owner is given the deliveries part of the business in that area by the company,” she says.
Molotsi says there are so many big cracks in the economy because many South Africans are not entrepreneurial. “Research by the Global Entrepreneurship Monitor has repeatedly reported this finding … Because of a lack of skills and entrepreneurship we have high unemployment and a high rate of businesses failing. There is so much dependence on imports and this affects prices of goods in the country, she says.” She is encouraged, however, to see that the government would, in its next term of office, “be focusing on building black manufacturers”.
In another development bound to have a positive impact on small businesses like spaza shops and taverns, De Beers Consolidated Mines (DBCM) has launched the De Beers Marine Zimele Business Hub in Cape Town aimed at supporting entrepreneurs in a range of sectors.

The hub is the company’s first in the Western Cape and sees the DBCM partner with entrepreneurs through funding, mentoring and guidance. The DBCM now has hubs in all four provinces where it operates. 

“We want to affirm people to move forward. We are creating an environment in which you own your future,” DBCM chairperson Barend Petersen told the launch at De Beers Marine in Cape Town.

In 2014, De Beers Zimele supported 233 new small- and medium-sized enterprises and created 2 335 jobs in rural and regional urban areas. Petersen said loans to entrepreneurs through the hubs totalled R60.7-million. Women make up nearly half of the entrepreneurs it supports.