Supply chain and logistics leader Imperial Logistics has added impetus to its transformation programme with an innovative new enterprise and supplier development strategy that will yield significant benefits for the group, its clients and fledgling businesses.
Expanding on the new best practice model that Imperial is employing to address this critical pillar of B-BBEE, chief strategy officer Cobus Rossouw says: “It is a ‘hybrid’ solution combining Imperial’s experience and expertise in the supply chain and transport space with the specialist skills of an enterprise and development service provider. Growing small businesses is not our core focus, so we believe that by partnering with an organisation that specialises in developing entrepreneurs, we can leverage their resources and skills to complement ours’ and offer small enterprises and suppliers unmatched opportunities while making a sustainable contribution to transformation.”
The partner that Imperial Logistics has chosen in this regard is The Awethu Project – a specialist SMME investment company that will work with the group to accelerate the growth of black-owned businesses and start-ups in South Africa. “Over many months, Awethu has worked with Imperial as a thought-partner in developing a solution that creates shared value for all Imperial stakeholders, including customers,” explains Rossouw. “The partnership has resulted in the creation of an Enterprise and Supplier Development (E&SD) Fund that will transform B-BBEE compliance from a cost-centre to a profit-centre, while ensuring that deserving suppliers within the Imperial value chain have an opportunity to grow their businesses and access new opportunities.”
Aptly named, “Sinawe” – meaning “we are together” – the fund stands not only to benefit clients in terms of real and measurable improvements in supply chain efficiencies, provided by more competent suppliers but also represents an opportunity for clients to co-invest.
“Sinawe will deliver bottom-line results for Imperial and it will drive the development of a pipeline of QSEs and SMEs that will boost not only Imperial’s, but also our clients’, preferential procurement, since some of the enterprises that we are mentoring and upskilling are companies that work directly with clients. Imperial is happy to make a revenue sacrifice in order to nurture promising enterprises that need support and assist our clients with their procurement scorecards.”
Both the approach and the fund are closely aligned with the national agenda to support small and medium enterprises and in his recent budget speech, finance minister Pravin Gordhan, stated that R3.9 billion would be allocated for SMMEs and co-operatives over the next three financial years and that the Department of Small Business Development’s total budget allocation was expected to increase from R1.2bn in 2016/17 to R1.6bn by 2019/20.
Rossouw explains that Imperial will offer mentorship and interventions focused on the group’s logistics expertise, while Awethu will address other business issues like human resources, finance and governance, as well as guide beneficiaries in accessing new markets and resources.
“Enterprises and suppliers identified in the programme will receive pre and post-investment support tailored to their individual growth stages and development gaps; support that we do not have the internal capability or capacity to offer, but which our partner will provide. Our approach is geared to delivering more than just B-BBEE scorecard compliance. It provides for the sustainable development of small businesses in the transport and logistics sector, allowing for their inclusion into the mainstream economy.”
Rossouw notes that the group’s new strategy represents an important expansion of its holistic approach to enterprise and supplier development, which will produce even more sustainable results. “The old maxim that says giving a man a fish will feed him for a day, while teaching him to fish will feed him for a lifetime, sums it up. Imperial recognises that the ideal approach to developing enterprises includes more than just injecting funds into the business. A more rounded solution is needed.”