Black owners feel restrained

25 April 2019 - 11:45
By Sowetan Reporter
Tshepo Langa poses a question to the panelists during the recent Sowetan Dialogues.
Image: Veli Nhlapo Tshepo Langa poses a question to the panelists during the recent Sowetan Dialogues.

The struggles are different for each SMME as the value chain is not open to black entrepreneurs despite the skills they might possess.

"We must acknowledge that we have different struggles, especially for emerging black company owners who want to enter the market even if you equip them with skills or funding," said Tshepo Langa.

Langa was one of the dozens of entrepreneurs who attended Sowetan Dialogues.

"The most important thing we need to acknowledge is that it is difficult for black people to enter the value chain. You find that the value chain is closed," Langa said.

He posed a question to the four industry players invited to give their input regarding the subject matter.

The panelists included Simon Shiya from the Small Enterprise Development Agency (Seda), Donald Mabusela from the Department of Trade & Industry (DTI), Malcolm Farrell, CEO of Supply Chain Network, and Vuyo Ntshoko, Gauteng Enterprise Propeller's (GEP) general manager for strategy, monitoring and evaluation

"I want to ask Malcolm how many black SMME owners that registered through SCN eventually managed to be suppliers for big corporates? I don't know the policies. Do they prefer black owners? What I am certain about is that it is difficult to crack the value chain in the industry," Langa said.

Langa further said Mabusela, from DTI, needed to explain the reasons behind the lack of transformation in asset management.

"I am in the retirement space, you've got R5-trillion worth of asset value in the whole of SA that is privately managed.

"Only R419bn is managed by black asset managers, so there's no transformation in that sector of the retirement industry.

Members of the panel at the Sowetan Dialogues.
Image: Veli Nhlapo Members of the panel at the Sowetan Dialogues.

"What is the DTIs role in ensuring that there is inclusive economic growth because we see the perpetuation of exclusive economic growth in such [an] industry?" he said.

Mabusela responded that the DTI has a responsibility to ensure that smaller businesses receive more assistance as opposed to bigger businesses.

"When we look at the various support programmes that we have as the DTI, because we have a responsibility to incentivise the industry to transform, you'll find that the support is structured in such a way that if you are a small business you get more support from us in terms of the percentage of the funding," he said.

Mabusela explained that the DTI has strict requirements for the companies they assist.

"Those that are more compliant in terms of transformation will receive more support from us than those that are less transformed to ensure that historically disadvantaged individuals are given the same opportunities," he said.

Farrell, on the other hand, responded to Langa's question by saying that tenders were being awarded to black entrepreneurs. "There was a recent change and an upgrade to the DTI code of good conduct with much more aggressive targets set out on the score sheet and corporates are being measured by this every day."