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Pick n Pay's scale business and enterprise development initiatives
- 1. Pick n Pay – a scale business R63bn turnover 7 countries >1000 stores 50% Franchised ~100 000 employees Estimated to have about 28.5% market share of the top 4 players in South Africa 1 FY14 results
- 2. “Make the customer Queen and she will make you King” Core Philosophy 4 legs of a table
- 3. Our plan 3
- 4. Be ethical Obey laws and regulations Be profitable Contribute resources towards community development & welfare Obligation to do what is right, just and fair and to avoid harm Law is society’s codification of right and wrong. The foundation upon which all others rest Economic Responsibilities Legal Responsibilities Ethical Responsibilities Philanthropic Responsibilities Adapted from: Carroll, 1991 Be a Good Corporate citizen
- 5. Multinationals and large South African corporates, 55 Medium sized South African companies, 433 Small companies, 1682 PnP corporate stores spend FY2014
- 6. Multinationals and large South African corporates 68% Medium sized South African companies 20% Small companies 12% PnP corporate stores spend FY2014
- 7. ENTERPRISE DEVELOPMENT PROCESS IDENTIFY INDUSTRY SOURCE SUPPLIER ASSESS NEEDS APPLY MENTORSHIP FINANCE MARKET ACCESS
- 8. Small Business Incubator To facilitate SMMEs’ and EMEs’ intro to retail through mentorship, guidance and support using the PnP structure • 3 Tiers of support •BABY < R5m •TODDLER between R5m – R8m •TEEN > R8m •Giving Access to Market and mentorship for small entrepreneurs Nontwenhle Mchunu former chocolate supplier to PnP
- 9. •Coming together – •empowering individuals, •creating jobs, •alleviating poverty •Advice on and access to Financial assistance Sibusiso Tshabalala – entrepreneur – charcoal supplier to PnP group
- 10. Cwebeni Project • Specialised skills developed • Environmental impact • Community participation • Electricity and water • Telkom connection
- 11. CHALLENGES TO ACCESSING FUNDING •Slow pace of process •Complicated application process •Conduit organisations/ agencies •Response time adjusted according to size of applicant ( smme/ start ups cannot afford to wait) •Call centre system for advice and guidance •Small business cannot navigate through the red tape •Insufficient communication between market players •Lack of flexible funding
- 12. OUR EXPERIENCES •Dept of Agric partnership ( Siyasiza , Vrede, Food basket for Africa, Dreamland Piggery ) •DTI funding options (Fairharvest )– timelines do not benefit small business •Lack of flexibility within parameters ( Rise uniforms ) •Govt contracts do not have favourable payment terms
- 15. Fairharvest Organic Farm, Limpopo Fairharvest Organic farm, Limpopo
- 16. ED PUBLIC / PRIVATE PARTNERSHIP Access to market •Off take agreement •mentorship infrastructure •Pack houses •Transport •equipment Financing •Working capital Business management •Accounting skills •HR/labour •Quality •Preferential trading terms Operational services •Distribution •Merchandise •marketing Regulatory environment •compliance Govt PnP
- 17. PROPOSED SOLUTIONS •Utilise different models for different categories •Engage with all market players for a comprehensive solution ( banks, retailers, agronomists, technologists etc ) •Flexible solutions driven by business needs •Limit media exposure until agreed size has been achieved or sustainability guaranteed
- 18. HURDLES FOR SMME’S •Compliance (Health / safety audit, SARS ) •FINANCE •Business management skills ( business plan, budgeting, cash flow) •Capital investment ( buildings, boreholes, trucks) •Infrastructure (Fencing, electricity and security)
- 19. “Some opportunities only come along once in a life time” Saraah, flower supplier to Pick n Pay stores • We have an obligation to create opportunities •Enterprise development builds the nation, empowers individuals and helps meet demands of society – Ackerman Pick n Pay Foundation
- 20. OUTCOMES •Firm commitment to growing ED in SA •Clear guidelines , roles and responsibilities •Efficient and effective PPP with deliverables •‘One-stop’ platform for Small Business
- 21. ED Process Identify industry Source supplier Assess needs Source mentorship Funding Access to market Monitor and measure invest