Presentation 3rd Global Forum 2009 Jj Ravjee 28 Oct2009 1


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Sustainable Agriculture and Food Production Incubation - Presentation to Global Forum on Innovation & Entrepreneurship 2009 - Jayesh Ravjee

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Presentation 3rd Global Forum 2009 Jj Ravjee 28 Oct2009 1

  1. 1. “ Turning 8 in 10 failures into 8 in 10 successes” Sustainable Agriculture and Food Production Mr JJ Ravjee Acting Executive Manager 28 October 2009 Presentation to Global Forum on Innovation & Entrepreneurship 2009
  2. 2. RATIONALE For Incubation in South Africa <ul><li>GROWTH </li></ul><ul><li>EQUITY </li></ul><ul><li>EMPLOYMENT </li></ul>
  3. 3. Stp Vision Stp Mission “ To develop, support and promote small enterprises to ensure their growth and sustainability.” Background “ An internationally recognised Centre of Competence that develops and supports innovative technology–based platforms for the creation and support of sustainable, globally competitive SMMEs”.
  4. 4. Incubation Division <ul><li>The Incubation Division uses the following TBC-organisational models to incubate both start-ups and existing enterprises: </li></ul><ul><li>Technology Demonstration Centres (TDCs) </li></ul><ul><li>Focus on demonstrating, and providing training through use of available technologies. </li></ul><ul><li>Technology Incubators (TIs) </li></ul><ul><li>Provide an environment in which to support technology-based enterprises. </li></ul><ul><li>Hybrid Centres </li></ul><ul><ul><li>Combine elements of the previous models whilst incorporating elements of the local environment to address specific needs of the small enterprises. </li></ul></ul>
  5. 5. Incubation Division <ul><li>The Incubation Division provides the following services through the TBCs: </li></ul><ul><li>Programme Management of the Current Centres supported by dti/STP. </li></ul><ul><li>Establishment and Development of Technology Business Centres. </li></ul><ul><li>Advising on Appropriate Business Models to be Adopted. </li></ul><ul><li>Development and Implementation of Operational Systems. </li></ul><ul><li>Provide on-going financial and technical support to TBCs. </li></ul><ul><li>Monitor and evaluate the performance of Incubators. </li></ul><ul><li>Undertake the research and benchmarking exercises. </li></ul><ul><li>Provide on-going financial and technical support to TBCs. </li></ul><ul><li>To facilitate quarterly networking and information sharing sessions. </li></ul><ul><li>Maintain ID as the Centre of Reference in business incubation on the African continent. </li></ul><ul><li>Advisory and Consultancy Services. Provide assistance to TBCs necessary; e.g training, management support and advice, etc.; </li></ul><ul><li>Develop linkages with donor agencies and other funding institutions. </li></ul><ul><li>To provide value-added services through network support and access to funding. </li></ul>Services provided:
  6. 6. Stp’s centres across the country
  7. 7. Stp’s centres AGRICULTURE Turning 8 in 10 Business Failures into 8 in 10 Successes Sugarcane Mpumalanga Develop disadvantaged entrepreneurs in the Sugar Cane industry through the process of agricultural business incubation. Essential Oils-plant cultivation and oil extraction Pretoria Focuses on empowering emerging farmers to produce and process high value essential oils Small scale agriculture Mpumalanga Demonstrating, assisting small scale farmers Floriculture Nelspruit Establishment and support of emerging farmers in the cut flower market Biodiesel Production Marble Hall Incubation of small scale farmers for biodiesel production
  8. 8. Stp’s centres (Other) Turning 8 in 10 Business Failures into 8 in 10 Successes ICT PE Creating ICT enterprises Chemicals Industry PE Specializing in start-up and growth of SMEs in downstream chemical industry Aluminium Products processing Richards Bay Training, skills development and incubation in the aluminium casting industry Bio and Life Sciences Modderfontein Nurturing entrepreneurial life-sciences and biotechnology companies Furniture Industry Branches : Cape Town White River Durban Umzimkhulu Jhb George Mthatha Provision of training, skills development and business incubation support in furniture manufacturing. Stainless Steel Middelburg Support & development to stainless steel industry Automobile Industry Rosslyn, Pta Development of products or services for automotive industry
  9. 9. Stp’s centres (Other) Turning 8 in 10 Business Failures into 8 in 10 Successes ICT Midrand Provides support services to entrepreneurs Copper, Zinc and Brass Metal processing Jhb Provide training and development of entrepreneurs and small enterprises in the casting of zinc, copper and brass Gold and precious metals benefication Polokwane Develop entrepreneurial jewellers Construction building and civil Durban Provide business support services, office infrastructure and other resources to eligible business in the construction sector Small-scale mining and beneficiation Randburg Provides a range of services to small-scale miners
  10. 10. Stp’s centres (Other) Turning 8 in 10 Business Failures into 8 in 10 Successes Jewellery Cluster Polokwane Establishing emerging jewelers in sustainable businesses Manufacturing Demonstration Technology Soshanguve To strengthen co-operation in the area of small business development within the respective countries.
  11. 11. Performance Review 2008/2009 For the Year Ended 31 March 2009 <ul><li>A total of 224 new SMMEs were established. </li></ul><ul><li>456 SMMEs supported. </li></ul><ul><li>10 628 jobs were created. (1 318 were direct jobs) </li></ul><ul><li>Previously Disadvantaged Individuals accounted for 87% of the people supported by stp, of which 37% were women. </li></ul><ul><li>Total Turnover of SMMEs was R129m. </li></ul>
  12. 12. Common Objectives of our Agri Incubators
  13. 13. Seda Sugar Cane Incubator <ul><li>SESUCI was conceived to create and manage an equitable and sustainable relationship between communities and the corporate sector. </li></ul><ul><li>To achieve this goal we have developed technology transfer packages to transform local individuals into business orientated farmers that can compete with the best internationally. </li></ul><ul><li>The company then links these farmers to multinational companies that process and market the produce. </li></ul><ul><li>This ensure that the majority of the land remains in the hands of the local African communities also addresses land reform, while the multinationals are assured </li></ul><ul><li>of a consistent supply of quality raw materials. Assuming an equitable price is paid </li></ul><ul><li>for the raw materials, both parties benefit. </li></ul>How do they work?
  14. 14. Seda Sugar Cane Incubator Results? <ul><li>Incubator has been running for two years and is incubating 70 PDI farmers, total 700Ha all of which has been placed under fertigrated drip systems. </li></ul><ul><li>Yield results have already been reported on, and turnover this year should exceed R10 million. </li></ul>
  15. 15. Current SMME Cane Production in Komati Region
  16. 16. Timbali Incubator How do they work? <ul><li>Pre-incubation phase, a needs analysis, planning and infrastructure assessment is done. </li></ul><ul><li>Entry Criteria. </li></ul><ul><li>Incubation Phase </li></ul><ul><li>Post incubation Phase </li></ul>Timbali identifies clustered potential farmers either through the Industry partners, Department of Agriculture, other institutions or through farmers who approach the incubator. The Incubation Value Chain is then implemented whereby:
  17. 17. Timbali Incubator Results? <ul><li>Reached its KPI’s in terms of its funders consistently over the past 6 years. </li></ul><ul><li>75% Are women-owned businesses. </li></ul><ul><li>Over the past 12 months, 550 individuals were directly dependent on the income generated by Timbali clients. (This excludes the dependents of the employees of the incubatees, indirect jobs and incubator staff members) </li></ul>
  18. 18. The process: Economy of Scale
  19. 19. Timbali Cluster Development Cluster Model Through the cluster the farmers benefit from: shared infrastructure, bulk buying, shared services, collective marketing, branding and advertisement, and coordinated selling under the trade name, e.g. “AmaBlom”.  <ul><li>The Cluster Model with the start-up of agri-SMMEs: </li></ul><ul><li>Increase economy of scale. </li></ul><ul><li>Develop a replicable system-dependant business operation format, that enables ordinary people of all skills levels to consistently deliver a predictable, quality product/service resulting in significant economic benefits. </li></ul><ul><li>Provides needs driven, tailor-made, enabling environment which promotes SMME growth into independent competitive enterprises. Achieved through training, mentorship, adaptation, packaging and implementation of R&D, business skills development, financing and marketing. </li></ul><ul><li>Technology-based and market-driven model to optimise economic growth of the individuals within the cluster through shared infrastructure, services and bulk buying. </li></ul><ul><li>Bridging the gap between emerging farmers and the industry’s need for global competitiveness. </li></ul>
  20. 20. Operational Pillars Mpumalanga Agri Skills Development & Training Incubator
  21. 21. SEOBI Hub and Spoke cluster Model
  22. 22. SEOBI Hub and Spoke cluster Model (continue ..)
  23. 23. MAPFURA-MAKHURA INCUBATOR (Biodiesel Production) MMI Incubation Model
  24. 24. MAPFURA-MAKHURA INCUBATOR (Biodiesel Production Value Chain)
  25. 25. Successes <ul><li>Almost all incubated farmers exceed the national production average and most exceed the large scale farmers average yield. </li></ul><ul><li>Development of one of the most comprehensive agricultural technology transfer packages available. </li></ul><ul><li>The on-site Gerbera Agri-Park whereby all the phases of successful incubation of the Timbali Clustered Prototype is evident. </li></ul><ul><li>Unique South African service delivery model </li></ul>
  26. 26. Challenges <ul><li>Up-coming farmers have own challenges, namely limited or no </li></ul><ul><ul><li>infrastructure, </li></ul></ul><ul><ul><li>farming equipment, </li></ul></ul><ul><ul><li>access to water resources, </li></ul></ul><ul><ul><li>formal markets </li></ul></ul><ul><ul><li>access to financial resources </li></ul></ul><ul><ul><li>technical skills </li></ul></ul><ul><ul><li>Transport between Production and Market. </li></ul></ul><ul><ul><li>Support due to vast distances. </li></ul></ul><ul><li>Unique South African challenges </li></ul><ul><ul><li>Land restitution process </li></ul></ul><ul><ul><li>Community owned land </li></ul></ul><ul><ul><li>Farming does not attract the youth </li></ul></ul><ul><li>Clients’ inability to pay up-front for services </li></ul><ul><li>Lack of but-in from all stakeholders </li></ul>
  28. 28. Lessons Learnt <ul><li>Utilization of home grown talent and expertise </li></ul><ul><li>One size does NOT fit all </li></ul><ul><li>The primary objectives must be the sole focus of the incubator </li></ul><ul><li>Support and commitment of Management and all stakeholders </li></ul><ul><li>Well resourced support team </li></ul><ul><li>Incubation is a business </li></ul><ul><li>Proper monitoring and evaluation systems </li></ul><ul><li>Marketing of successes </li></ul><ul><li>“ SIMPLE” franchise type processes </li></ul><ul><li>Networking </li></ul><ul><li>WIN-WIN-WIN </li></ul><ul><li>The agenda of the incubator is the one and only objective </li></ul><ul><li>Rather try and fail then fail to try! </li></ul>
  29. 29. Seda Technology Programme The dti Campus Block G 77 Meintjies Street Sunnyside Pretoria 0001 Tel: (012) 441 1000 Jayesh J Ravjee [email_address]