You’ve just had a meeting with a BEE consultant who has told you that the only way to keep a decent enough score is to either sell shares or really get involved in your value chain and support your suppliers.
But why should you do this? Why should you help small and medium black owned businesses in your value chain to grow?
Supplier development is not a unique concept purely to empower businesses whose ownership lies with previously disadvantaged people.
Supplier development is in fact a principle for competitive advantage and business development (your business) practiced worldwide. By supporting your suppliers to grow strategically you are able to guide their growth based on specializations that you would like to see in your businesses growth, for example through product development projects.
Through a partnership in development, these SMEs may then be able to access certain incentives to enhance this growth path and the benefits may be passed onto you providing a win-win situation.
The challenge with most SMEs is they need to be held and supported through this process, they need access to markets through your business and access to finance in order to effectively supply on your orders/contracts.
I’ve personally seen the potential strategic growth when a business combines its S&ED spend (which we prefer to view as investment) with developmental funds available through the NEF, DTI and IDC in a structured program.
This is why when I heard about the UN’s Supplier Development Program last year I jumped on getting to clearly learn the methodologies, which they have successfully implemented in other developing countries.
Being an approved consultant with the UN for this program and having been trained in this methodology, I further believe strongly that - by focusing on the supplier development aspect and implementing these methodologies and well as access to finance - your return on S&ED investment will be tangible.
The question is; Are you willing to see this as the potential opportunity for your business to grow in a unique, competitive and sustainable way?