Pick n Pay – a scale business

R63bn turnover

7 countries

>1000 stores

50% Franchised

~100 000 employees

Estimated to have about 28.5% market share of the top 4 players in South Africa

1 FY14 results

“Make the customer Queen and she will make you King”

Core Philosophy 4 legs of a table

Our plan

3

Be ethical

Obey laws and regulations

Be profitable

Contribute resources towards community development & welfare

Obligation to do what is right, just and fair and to

avoid harm

Law is society’s codification of right

and wrong.

The foundation upon which all others rest Economic Responsibilities

Legal Responsibilities

Ethical Responsibilities

Philanthropic Responsibilities

Adapted from: Carroll, 1991

Be a Good Corporate citizen

Multinationals and large

South African corporates, 55 Medium sized

South African companies,

433

Small companies,

1682

PnP corporate stores spend FY2014

Multinationals and large

South African corporates

68%

Medium sized South African

companies 20%

Small companies

12%

PnP corporate stores spend FY2014

ENTERPRISE DEVELOPMENT PROCESS

IDENTIFY

INDUSTRY

SOURCE

SUPPLIER

ASSESS

NEEDS

APPLY

MENTORSHIP

FINANCE

MARKET

ACCESS

Small Business Incubator

To facilitate SMMEs’ and EMEs’ intro to retail through mentorship, guidance and support using the PnP structure

• 3 Tiers of support •BABY < R5m •TODDLER between R5m – R8m •TEEN > R8m

•Giving Access to

Market and mentorship for small entrepreneurs

Nontwenhle Mchunu

former chocolate supplier to PnP

• Coming together – • empowering individuals, • creating jobs, • alleviating poverty

• Advice on and access to Financial assistance

Sibusiso Tshabalala – entrepreneur – charcoal supplier to PnP group

Cwebeni Project • Specialised skills

developed • Environmental impact • Community participation • Electricity and water • Telkom connection

CHALLENGES TO ACCESSING FUNDING

• Slow pace of process

• Complicated application process

• Conduit organisations/ agencies

• Response time adjusted according to size of applicant ( smme/ start ups cannot afford to wait)

• Call centre system for advice and guidance

• Small business cannot navigate through the red tape

• Insufficient communication between market players

• Lack of flexible funding

OUR EXPERIENCES

• Dept of Agric partnership ( Siyasiza , Vrede, Food basket for Africa, Dreamland Piggery )

• DTI funding options (Fairharvest )– timelines do not benefit small business

• Lack of flexibility within parameters ( Rise uniforms )

• Govt contracts do not have favourable payment terms

Vrede, Free State

Bana Bagwala, Mpumalanga

Fairharvest Organic Farm, Limpopo

Fairharvest Organic farm, Limpopo

ED PUBLIC / PRIVATE PARTNERSHIP Access to market

•Off take agreement

•mentorship

infrastructure

•Pack houses

•Transport

•equipment

Financing

•Working capital

Business management

•Accounting skills

•HR/labour

•Quality

•Preferential trading terms

Operational services

•Distribution

•Merchandise

•marketing

Regulatory environment

•compliance Govt

PnP

PROPOSED SOLUTIONS

• Utilise different models for different categories

• Engage with all market players for a comprehensive solution ( banks, retailers, agronomists, technologists etc )

• Flexible solutions driven by business needs

• Limit media exposure until agreed size has been achieved or sustainability guaranteed

HURDLES FOR SMME’S

• Compliance (Health / safety audit, SARS )

• FINANCE

• Business management skills ( business plan, budgeting, cash flow)

• Capital investment ( buildings, boreholes, trucks)

• Infrastructure (Fencing, electricity and security)

“Some opportunities

only come along once

in a life time” Saraah, flower

supplier to Pick n Pay stores

• We have an obligation to

create opportunities

• Enterprise development

builds the nation,

empowers individuals and

helps meet demands of

society – Ackerman Pick n

Pay Foundation

OUTCOMES

• Firm commitment to growing ED in SA

• Clear guidelines , roles and responsibilities

• Efficient and effective PPP with deliverables

• ‘One-stop’ platform for Small Business

ED Process

Identify industry

Source supplier

Assess needs

Source mentorship

Funding

Access to market

Monitor and

measure

invest