A sweet deal for spaza-shop owners from Mondelez SA

A group of Soweto spaza-shop owners are celebrating their completion of the launch edition of a six-week Enterprise Development Programme, supported by Mondelez South Africa. The programme brought together 30 South African spaza-shop owners one day a week for full-day sessions featuring both industry-specific business training modules and targeted coaching and mentoring.

At a ceremony at Riversands Innovation Hub at Midrand on 2 August 2017, Mondelez South Africa recognised the spaza-shop owners’ achievements with certificates of completion. Mondelez South Africa also presented each participant with store branding, a laptop and a prepaid electricity and airtime sales device to consolidate their efforts to take their businesses to the next level.

“We have been aware for several years that a significant proportion of our products are sold through spaza shops,” says Mondelez South Africa corporate and government affairs manager, Navisha Bechan-Sewkuran. “This is a fiercely competitive retail sector, yet because it has been so informal, many spaza-shop owners lack the entrepreneurial skills required to manage a successful business and are very keen for opportunities to improve their skills, and we decided to help them.

The programme also aimed to address some of the challenges spaza-shop owners face and, in particular, introduce them to alternative revenue streams.

“We looked at several business skills training packages, but we felt they were too generic, risking only a haphazard impact. So we worked hard with our facilitators, Beehive Capital, to tailor a programme that is industry specific and can have a direct, lasting impact on the owners’ businesses.”

Participants were transported to Riversands for the programme, where about five hours of each training day was occupied by modules to build entrepreneurial skills. These included personal and business marketing; pricing; setting up bulk buying through associations to enable cheaper prices and more effective competition; and daily business functions and administration. Industry-specific modules included external speakers on best practices in various key business areas, as well as presentations from the brands featured in the basket of 12 items used to define a spaza shop. Mentoring and coaching in small groups occupied the remaining two-and-a-half hours of each training day.

The programme also aimed to address some of the challenges spaza-shop owners face and, in particular, introduce them to alternative revenue streams.

“Without being able to take payments from bank cards, they miss opportunities to access spend from SASSA grant recipients,” says Bechan-Sewkuran. “In fact, none of the shops on the programme were equipped to sell prepaid airtime or prepaid electricity, either. We also found that only 16% of the participants had basic smartphones that would enable them to access FMCG rebates for advertising FMCG products.”

Now, the programme has transformed the business potential of the 30 South African participants, who came from the Freedom Park and Devlin areas of Soweto. They were identified through traders’ associations, which will also cooperate with Mondelez South Africa in identifying participants for future programmes.

Participant and spaza-shop owner, Zolani Jazz Nyengule, says: “The guest facilitators have vast knowledge and could answer any questions asked, and where they didn’t know, they were honest enough to get the relevant person required to respond. The fact that Mondelez is trying to help small business owners rise above the cruel competition system is encouraging.”

A shorter follow-up programme for this year’s participants is planned for next year, enabling them to identify areas for review or where they would like to hone their skills further.

Spotong had the opportunity to chat to two of the recipients of the programme, to find out how the experience has assisted in their business.

What knowledge have you gained from the programme and how has it assisted you in your small business?

Zolani Jazz Nyengule: I realised that I could have been running my business a lot smoother by implementing basic business management skills. Thankfully, I am now clued up on the basics and have invested more time in the planning of how to buy stock, which enables me to save more money to invest back into my business. I now know exactly how to find the specials to stock up on and save money in the long run. This programme has also enabled me to buy on credit, which I couldn’t use before, and I must admit that my sales have risen dramatically.

Grace Mdlalose: I have learnt how to manage all aspects of my small business in a more lucrative way. I have learnt marketing skills, which I never really understood before, and the importance of how to handle and understand my customers. I am excited to start implementing these skills and watch my business grow.

What was the highlight of the programme for you?

Zolani Jazz Nyengule: The highlight for me was that every week, for the last hour or so of the programme, we were assisted by different coaches and mentors. I benefited greatly from the one-on-one interactions from my mentors and coaches and for assisting me on a personal level, according to my needs and struggles, in trying to sustain and grow my business.

Grace Mdlalose: I particularly enjoyed the one-on-one sessions with the seniors, who gave me the special attention that I needed. The advice was practical and I was shown how easy it is if you just implement the basics. I manage money so much better now, because I have a greater understanding of the ins and outs of running a small business.

Have you seen any significant changes in your business since completing the programme?

Zolani Jazz Nyengule: Yes! I have more customers and the number of new faces is growing each day.

Grace Mdlalose: I have definitely turned a profit almost immediately and, for the first time, some of my stock had to be replenished very quickly. I have never sold so much Oreos before. I am the only spaza shop in my area that sells Oreos, and my customers are buying more and more. The kids love it, too