Theo Meintjes' presentation on the DTI Incentives for Black Business Supplier Development Program, at the Cap40.

1. 1
21/05/2014
Getting hold of the investment
incentives offered by the DTI.
Speaker: Theo Meintjes

2. BBSDP
Black Business Supplier Development
Program
• Cost sharing Grant
• Black owned businesses (>50%)
• Improve competitiveness & sustainability
• Help become part of mainstream economy
• Open until 31 July 2017
BBSDP

3. Qualifying Criteria
• 51% black majority shareholding;
• R250 000 to R35 million turnover per year;
• 50% management by black people (HDI)
• Enterprise formally registered for VAT;
• Be operating and trading for at least 1 fin. Yr.
BBSDP

4. Qualifying criteria (cont.)
• at the sole discretion of the dti, an enterprise
that has been operational/registered for less
than a year may be considered for this
incentive, provided that the enterprise can
supply sufficient evidence to service a
tender/contract.
BBSDP

5. How it works
• Applicant pays their part + VAT to supplier
• Prove of payment to DTI
• DTI pays their part.
• In exceptional cases, applicant is allowed to
pay in full and claim back grant.
BBSDP

6. How much?
• Tools, Machinery & Equipment
– 50%
– maximum R800,000 cumulative (But DTI allows up to
R1m).
• Interventions
– 80%
– Maximum R200,000 cumulative
• NB: Grant My not exceed 30% of previous yr.
turnover
BBSDP

7. Requirements to apply
Some of the documents required when applying
• Signed financial statements
• Three quotes
• Tax Clearance Certificate of applicant
• Tax clearance certificate of preferred supplier
• Proof of available funds
• ID’s of owners, management and all workers
BBSDP

8. Examples of qualifying expenses
ENTERPRISE SUPPORT SERVICES
• Company diagnostics;
• Business Plan to raise finance
• Management information systems;
• Quality management systems and assurance
• Patenting and intellectual property rights;
• Production and productivity improvements;
• Product improvements;
BBSDP

9. Qualifying expenses (cont.)
ENTERPRISE SUPPORT SERVICES
• BEE rating and certification; and
• Merger (majority shareholding) and acquisitions
NOTES:
1. Single item applications with new TCC’s and
based in Gauteng appear to work best.
2. Expenditure that occur over a period of time
appear to be giving most problems.
BBSDP

10. Non qualifying expenses
• Office equipment, furniture and computer hardware
costs, except for
– Business Process Services (BPS) applications; Land
and buildings; Working capital;
• Training programmes that exceed five (5) weeks or
one-hundred and sixty (160) notional hours;
• Long-term formal training (e.g. a Master of Business
Administration), including training at accredited
institutions such as universities;
BBSDP

11. Non qualifying expenses (cont.)
• Interventions that are already funded by another
government scheme or parastatal;
• Any other costs that the Adjudication Committee,
in its sole discretion, deems as non-qualifying;
and
• Design and printing of marketing material
• Vehicles (sedans, mini buses and buses , panel
vans ,bakkies)
BBSDP

12. Network facilitators
• Accredited
• DTI pays fees
BBSDP

13. How is this program performing?
• Over subscribed.
• Could be as quick as 6 weeks, but that is the
exception.
• Approx. 4 months to process an application
• Approx. 4 months to process a claim.
• Administration is reasonable
BBSDP

14. Conclusion
• A successful program
• Can be frustrating in certain cases
BBSDP