Johannesburg - Small black businesses are increasingly starting to benefit from popular retailers’ supply chain programmes as more and more of their products hit supermarket shelves.
In its 2014 annual report released last week, Pick n Pay said it had purchased goods and services amounting to about R800 million from black-owned companies, with about R370m of that sum spent on women-owned companies.
In his report, Pick n Pay’s chairman Gareth Ackerman said: “From spices to pharmaceuticals to fresh produce, our impact is being felt by a large number of small companies we have introduced to our supply chain and, in many cases, mentored on developing their businesses.”
Ackerman added that the retailer planned to accelerate its engagement in this programme in the coming year.
Pick n Pay’s small business incubator programme provides mentorship to small suppliers by assisting them in managing industry demands and also on buying and negotiation techniques, among others.
Head of transformation at Pick n Pay Suzanne Ackerman-Berman said the face of supply chain had changed over recent years as more local suppliers were finding ways to get their products on to the shelves of national supermarket chains.
She said Pick n Pay, through its small business incubator programme, had assisted a number of small suppliers while others “fell by the wayside due to lack of skills”.
She said the programme had evolved from when it started six years ago.
When the programme was started, Pick n Pay published a newspaper advertisement calling on suppliers who wanted to see their products on the listed retailer’s shelves to come forward.
“The response was phenomenal, we got over 1 000 responses and sifted through each and every application, but not everyone made it because of lack of skills and some of the entrants were simply not ready,” she said.
Ackerman-Berman added that the greatest gift for entrepreneurs was a market where they could sell their goods or services.
She added that with the new chief executive, Pick n Pay had re-entrenched the programme.
“We have committed that each and every region is going to procure from small suppliers and we [are] going to make our stores more accessible to small suppliers.
“It can be very intimidating for small suppliers to supply into the large retailers, so we are trying as best as we can to make the whole process smoother and easier through the incubation,” she said.
Some of the beneficiaries include Johannesburg-based businessman Sibusiso Tshabalala, who supplies Pick n Pay stores with house brand charcoal. Meanwhile, the Siyazisiza Trust, a non-profit rural development organisation based in Johannesburg, supplies Boxer stores with fresh produce.
The trust’s director, Jane Zimmerman, said the organisation had a relationship first with the Ackerman Foundation, which later turned into a business opportunity. “They initiated the supply to Boxer stores through our gardening projects where growers can supply nearby stores.”
The growers from rural communities made earnings of R260 000 in 2012 and R166 000 last year. Zimmerman said the profits from cash crops such as spinach, cabbages and tomatoes were dependent on the climatic circumstances.
Other suppliers include tea growers, spice makers and toilet paper producers. - Business Report