Government empowers spaza shops 

With the launch of the R500 million Spaza Shop Support Fund (SSSF), government is ready to assist entrepreneurs who want to establish startups, expand their businesses, and gain essential business skills to improve the performance of their enterprises.

This is according to the Minister of Small Business Development, Stella Ndabeni.

With the recent drive to have spaza shops registered, government has received 87 407 applications and of these, a total 53% is from South African-owned spaza shops.

“Our commitment with this fund is to support those who heeded the President’s call to register their spaza shops. As the Department of Small Business Development (DSBD), we can help you when you have an idea and want to start a business.

“We have incubators that help new and startup businesses. We can help you from being an informal trader to a formal trader, to start a spaza shop and to own a wholesale or an entire distribution channel. We will be working with you to help you to turn things around,” said Ndabeni.

The support fund was launched on Tuesday in Soweto to support South African-owned township community convenience shops, including spaza shops, to increase their participation in the townships and rural areas retail trade sector.

READ | Government launches R500 million Spaza Shop Support Fund 

Jointly administered by the National Empowerment Fund (NEF) and the Small Enterprise Development Finance Agency (SEFDA), the fund provides critical financial and non-financial support to township businesses, including community convenience stores and spaza shops.

The fund provides various types of support, including the initial purchase of stock via delivery channel partners, upgrading of building infrastructure, systems, refrigeration, shelving and security, as well as training programmes, which includes point of sale devices, business skills, digital literacy, credit health, food safety and business compliance.

“The fund will address economy of scale disadvantages by linking spaza shops to buying groups for aggregation and bulk purchasing; building business capacity through training and support to improve shop operations; and enhancing market competitiveness to help spaza shops compete with larger retailers,” the Minister said.

The fund will be rolled out nationally to impact spaza shops across all major townships, as well as rural areas.

The Minister said government endeavours to work with entrepreneurs to localise supply chain opportunities for township and rural enterprises.

This will ensure that spaza shops do not procure imported products or simply use the platforms of large companies.

“To achieve this, we will utilise other instruments like the Small Enterprise Manufacturing Support Programme, Township and Rural Entrepreneurship Programmes (TREP), the Informal and Micro Enterprise Development Programme (IMEDP), Asset Assist, and our Shared Economic Infrastructure Facility.

“These programmes in turn have the potential to attract municipalities, the private sector, business and informal trader associations, and other stakeholders to work together in contributing their facilities, expertise and resources in support of new localised supply chains and distribution networks for spaza shops. 

“Logistics management partners will offer logistics management services, including warehousing and delivery solutions. They will ensure that products are stored safely and delivered efficiently, reducing transportation costs, and improving the overall supply chain efficiency for spaza shops,” the Minister said.

DSBD Connect

The department has recruited 52 Business Regulation Officers across all districts and metros to support business registration using the DSBD Connect system.

DSBD Connect is a platform which will be used to collaborate or put together small business to collaborate and/or work together on a particular project. 

This can be businesses within the same industries or different industries but need each other for specific skills or qualifications. 

The platform will put together small businesses within the same geographical area, interests, and skills. 

“Despite their importance, spaza shops face several challenges, including access to capital, security concerns, and competition from formal retailers, like larger retail stores and supermarkets which are encroaching on their markets.

“South African-owned spaza shops also face intense competition from foreign-operated spaza shops, who use more organised supply chains to gain competitiveness.

“Therefore, I want to encourage you to collaborate and establish cooperatives so that you can leverage resources, knowledge, and work together on projects, sharing best practices,” Ndabeni said.

Access to funding 

To access the funding, applicants need to apply to the National Empowerment Fund (NEF) and the Small Enterprise Development Finance Agency (SEFDA) through the prescribed application process outlined on the relevant institution’s website.

The following website can be used to apply for funding:

Spaza Shop Support Fund – www.spazashopfund.co.za 
NEF – www.nefcorp.co.za 
SEDFA – https://systems.sefa.org.za/SMMEPortal/

The contact details for the Spaza Shop Support Fund call centre are 01 1 305 8080 or via email: Spazafund@nefcorp.co.za.

Contact details for the NEF call centre are 0861 843633, SEDFA call centre 012 748 9600 or an email can be sent to helpline@sefa.org.za. – SAnews.gov.za

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