Overall Winner – sponsored by Absa
SPAR Group Ltd is a warehousing and distribution business listed on the JSE in the Food and Drug Retailers sector. The group owns several country licences for the SPAR retail brand, which is used by a network of independent retailers who trade under the brand.
With buy-in from a CEO level, management and a dedicated in-house team, the SPAR Group Ltd demonstrates visible commitment to deliver their Supplier Development transformation goals and targets, supporting their vision to be the first-choice brand in the communities they serve. SPAR’s purpose-driven strategy addresses real South African challenges such as food security, nutrition, job creation and transformation. Their SPAR Rural Hub model (a collaboration between small-scale farmers, suppliers, communities and SPAR stores) creates opportunities and shared value, and positively contributes to societal change, which enables SPAR to remain true to their purpose: to inspire people to do and be more.
SPAR’s programme and results boast a total programme value of R 11 323 000.00 and procurement spend of R 4,6 million with small suppliers. In particular, the judges were impressed by:
- their recognition of the transformative potential of ‘Purpose’ and effort to position it within the company and operating model to achieve greater integration
- their genuine interest in promoting suppliers backed by tough investments to this end
- the evidence of suppliers assisting in market access and their willingness to develop suppliers who work with their competitors
- the authenticity and innovative nature of the SPAR Rural Hub model which shows merit and impact on the ground in transforming rural, farming communities
- their effort in addressing barriers to growth, especially for export markets, helping their small-scale suppliers become GlobalGAP accredited
- their commitment to collaborative action through the partnerships formed
- their evidence presented in support of long-term Supplier Development success -with the outcomes, outputs and results of their programme
SPAR Group Ltd are actively pursuing higher levels of innovation, efficiency opportunities and value partnerships, and thus are deserved winners of the title of Overall Winner. We look forward to seeing this initiative grow and scale nationally, and toward bolder investment in this initiative in the future!
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Impact Award – sponsored by Business Day
Tiger Brands is a leading, branded FMCG company. It is one of the largest food manufacturers and leading marketers of FMCG products in Africa and a Top 40, JSE-listed company with leading brands in the food, beverages, personal care and home care categories.
At Tiger Brands, Enterprise and Supplier Development is embedded in the corporate strategy of the company whose objective is to be the leading food manufacturer, driving supply chain transformation, impactful development and support of commercially sustainable black-owned enterprises in the food supply and distribution chain. Tiger Brands only set up an ESD Division in April 2018 and has since finalised an ESD Strategy that embeds (1) unlocking procurement for black-owned enterprises, (2) developing support instruments that enable building of operational and financial capacity of black businesses, (3) driving meaningful participation of black-owned farmers into agricultural supply chain, and (4) building and strengthening distribution capabilities of black distributors to drive distribution of Tiger Brands products into new markets.
They have initiated a Market Access programme which supports the Tiger Brands sourcing team by providing a channel to source goods and services from black-owned, small enterprises and boast more than R150m worth of contracts to small, black businesses in 18 months since the approval of the strategy. They recently rolled out a Smallholder Farmer Development programme that champions supporting more than 50 emerging, black farmers by integrating them into Tiger Brands supply and value chain, provision of technical and business skills, and access to funding with their R100m ESD Fund. They currently spend R1,8bn on small suppliers, representing 8,5% of their overall total procurement spend, supporting 127 businesses with an average size turnover of R1 000 000.
The judges were particularly impressed with
- how Tiger Brands articulated and provided evidence of the impact of this new programme (including detailed results, a mature set of metrics of success and effective return on investment)
- evidence of end-to-end integration, the scale of impact and potential scalability of the model.
- how Tiger Brands use their extensive influence and sizeable position in the market to be the drivers of progress in opening of the economy to small suppliers, especially those in the Agri/ Agri-processing.
- their demonstration of how an SD programme with intention could impact across all areas of economic transformation, public-private collaboration, and nation building.
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Newcomer Award – sponsored by Absa
The V&A Waterfront is an iconic destination located in the oldest, working harbour in the Southern Hemisphere. This 123-hectare, mixed-use development comprises residential and commercial property, hotels, retail districts, and extensive dining – to leisure and entertainment facilities. It is also the operator of the newly upgraded Cape Town Cruise Terminal.
The V&A Waterfront, which have over 250 SMME tenants and about 300 SMME suppliers, place huge emphasis on Supplier Development that plays a role in harnessing entrepreneurship and in creating employment. The V&A Waterfront has re-imagined the festive season into a celebration of local talent and environmental sustainability. Themed, Joy from Africa to the World, the V&A is representing an experience aligned to its purpose to collectively create the world’s most inspiring waterfront neighbourhood. They have partnered with over 140 artisans to create a vibrant wonderland made from craft, design and upcycled materials. In doing so, they aim to tell a uniquely African story that’s joyful, inspiring and shows what an African festive season is all about.
They actively partnered with a number of industry stakeholders such as The Craft & Design Institute and Music Exchange, PWC and the Western Cape Department of Economic Development and Tourism who provided skills and enterprise development support and supported them in the creation and curation of the Festive showcase.
Boasting, in its first year, a spend of R336 million on small suppliers representing 38% of their overall total procurement spend, an average spend of R1,1 million per small supplier, the judges were impressed with
- how the V&A embedded the concept of shared value in their operating model, showing brand commitment beyond simply making a profit
- their dedication to creating jobs, supporting and integrating many smaller suppliers into every level of the supply chain and boosting the local ‘making’ economy
- their collaborative approach to working with various ecosystem players to deliver a unique programme
- how the V&A are leveraging the suppliers’ ecosystem and promoting market access beyond the retail precinct itself
The V&A is well placed to use its influence and footprint to build a socially inclusive business that invests in local communities and leverages its own assets and resources to create new opportunities for the economically excluded. It’s because of this inspired, well-developed thinking that the judges felt confident that in years to come this programme will thrive and deliver!
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Youth Development Award
In 2019/20, the focus of the Distell ESD team has been almost exclusively on helping to keep all their existing ESD beneficiaries in business and profitable. They continue to focus on the creation of healthy, symbiotic relationships, necessary for the economy to grow, and that speak to the authenticity of a brand that is committed to shared value.
The judges felt that Distell particularly showed merit in their approach in transforming the youth target market through their rural development initiatives and in pushing the local manufacturing agenda quite strongly. They saw evidence of a strong, value chain focus – on the customer-facing tavern side and farming side. Amongst others and notably, Distell’s Bansela Taverner Programme has 393 taverns enlisted, creating an estimated 197 jobs and their Green Up Recycling Programme boasts 124 Environmental Assistants/waste-pickers who are largely youth.
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Black Women Development Award – sponsored by Cold Press Media
With over 30 years of experience, the Empact Group specialise in providing quality food services and support solutions in catering, cleaning, hygiene, pest control and facilities management.
The Empact Group aim to “Empact” the lives of people they touch in a world where just meeting expectations is not enough. They further believe that Supplier Development initiatives, if properly executed, can lead to meaningful business wins, in the short, medium and longer term. These wins could include any or a combination of: improved performance, reduced costs, increase in quality, innovation and establishment of best practice.
Transformation is embedded in the strategy of Empact. At a programme level, they set milestones in place and measure themselves against the achievement of supplier demographic targets. They actively aim to increase the number of, and value of the business allocated to black women-owned suppliers in their supply chain. The approach is to explore, harness and complement the advantages and inherent qualities that women entrepreneurs bring to the table to mitigate the challenges experienced by them. The activities include access to resources (financial and other), market access opportunities and mentorship to help women to grow their businesses to the next level.
The judges were impressed by their 30% of total procurement spend on SMMEs of which 39% is with black women-owned suppliers. They were also excited by the overall merit/ potential impact of the approach in transforming this target market and the demonstrated impact this program has had on women-owned business.
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Rural and Township Development Award
The SPAR Rural Hub supports small-scale farmers and creates markets for their products. This contributes to job creation, income generation, infrastructure development, skills transfer and empowerment, while creating a food system that provides affordable, nutritious, fresh produce. Their first rural hub was established in 2016 with five small-scale farmers producing on 22 hectares of farmland. The rural hub has since expanded to 12 farmers and 122 ha of vegetable production. All participating small-scale farmers receive training covering all aspects of farm management and food safety, provided by an in-house team of qualified agronomists.
The judges felt that SPAR Rural Hub model was intentionally focused on rural community development and was different to other programmes in that it addresses a systemic issue such as food security. They were further impressed by
- the demonstrated impact of the approach in transforming this target market – in a very impoverished sector of society
- the focus on shortening the supply chain and developing suppliers of products in rural areas through a localised distribution platform
- the implementation of local gap standards for small businesses
- their collaboration with Food Lovers market (a competitor) for market access for emerging farmers
As deserving winners of the Rural Award, the judges believe that the SPAR Rural Hub can be scaled and duplicated, and could impact across all areas of economic transformation in the long run, improving food security and contributing positively to health and wellbeing in rural communities across South Africa.
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Skills of the future (4IR) Award – sponsored by SoluGrowth
Unilever is a multinational corporation selling consumer goods including foods, beverages, cleaning agents and personal care products.
Unilever are one of the few finalists who showed a strong focus on supply chain innovation, sustainability and implementing 4IR solutions for supply chains of the future and in meeting consumer and market demands.
In particular, through their Isazi Farming Technology project, Unilever are providing technological solutions in the agriculture sector through the use of artificial intelligence and machine learning. If funded well, these solutions could be scalable and could contribute to further impacts in the agricultural sector. Unilever also uses an innovative, internal, online talent marketplace, which helps employees push the boundaries of their career by using an AI-powered platform to identify personalised, open opportunities across the business, in real time.
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Small Supplier Award – in partnership with Seda
Founded in 1895, The South African Breweries (Pty) Ltd (SAB) is part of AB Inbev, the world’s biggest brewer with more than 400 brands and brewing interests around the world.
SAB recognizes that one of the major hurdles for SMEs in South Africa is the ability to gain entry into big business and form part of their supply chains. This requires a symbiotic relationship with big business working alongside smaller suppliers. The SAB Accelerator was established to develop black-owned and black women-owned suppliers. The programme is geared towards fast-tracking participants’ growth, the programme employs ten highly-experienced business coaches and ten engineers, offering tailored, business and deep technical coaching to the participants.
The desired impact is transforming of SAB’s supply chain in alignment with procurement targets, improving competitiveness and sustainability of SMEs to operate in an ever-changing market and contributing towards the creation of jobs.
SAB’s Supplier Development strategy has an end goal of developing enterprises and suppliers to maximise exports from South Africa and minimise imports. They currently spend R125 million in supporting small suppliers, comprising 100 businesses with an average size (turnover) of R12 million. The programmes specifically identify localization opportunities within SAB’s supply chain with 97% of their ingredients sourced locally. Building on their MAP to encourage wider access to markets rather than dependency on the SAB markets alone will further increase the long-term impact within the suppliers.
The judges were particularly impressed by SAB’s
- highly collaborative, mature approach based on a value chain perspective
- leadership and authenticity in the promotion of small suppliers in the “entrepreneurial ecosystem”
- high level commitment to their 10 000 jobs target
- integration of SAB Foundation efforts i.e. using social investment to spur innovation and multiple innovation models in their approach (accelerator, coaching, funding, digital, etc)
- their deliberate strategy to protect the long-term success and profitability of small suppliers, especially in vulnerable, rural and women-led organisations over this post-Covid period
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Local Manufacturing Award
The V&A Waterfront have taken a strategic decision to use their influence in the retail space to boost the local craft and creative industry through their various programmes and initiatives, most notably the Joy from Africa to the World Programme.
They have successfully shown leadership in the ecosystem and built a socially inclusive business that invests in local communities and leverages its own assets and resources to create new opportunities for the economically excluded. Boasting, in its first year, a spend of R336 million on small suppliers representing 38% of their overall total procurement spend, an average spend of R1,1 million per small supplier, their collaborative approach to working with various ecosystem players to deliver a unique programme, tangible support to local makers and promotion of market access for them, locally and internationally make them worthy of this award.
Collaboration Award – in partnership with Fetola
The success of any SD model is based on building, supporting and forming strategic partnerships. This year, Distell and Tiger Brands clearly articulated and illustrated their long-term commitment to success, growing the ecosystem and to innovative cross-sector collaboration
In particular, these companies both showed
- clear intention to grow the ecosystem of independent, small suppliers beyond their own supply chain, equipping these suppliers for diversification, growth, and sustainability
- support to the broader ESD ecosystem by providing platforms to improve accessibility to support and services
- active engagement in ecosystem activities and dialogue to promote shared learning
- dedicated financial support, investment and active partnerships with government to provide funding guarantee mechanisms
As significant players in the South African economy we encourage Tiger Brands and Distell to continue to play a significant role in transformation and acceleration of the SME landscape to support our much-needed economic recovery and reignite growth.
Highly Commended Finalists
Goodyear is one of the largest tyre manufacturing companies in the world, they started their manufacturing facility in South Africa in 1945 and, today, have a growing footprint in South Africa and Sub-Saharan Africa. They are also represented by two subsidiary companies in the country – the Hi-Q franchise, a trusted and award-winning tyre fitment centre in South Africa, as well as TrenTyre, the #1 Service Provider for fleets.
As a newcomer, Goodyear have been commended by the judges for the intentional strategy of developing a few suppliers but deeply integrating them into the supply chain and walking a journey with them that derives mutual benefit and impact. They put a strong emphasis on customer base diversification for its suppliers to ensure sustainability beyond the Goodyear supply chain. Even though this is a newcomer, this brought a different spirit compared to all applicants seen; they have potential to make sustainable impact. With rigorous metrics for reporting, transparency in showing results and very clear targets for growth, they may be strong contender in the Impact Category in 2021!
We would also like to commend the other finalists in the Absa Business Day Supplier Development Awards – Envirosev, PetroSA and Sasol – who have all shown leadership and commitment to building an economic and social ecosystem where small businesses and large corporates work together and thrive.