Transformation and supplier development
Black empowerment and supplier development remain two major issues facing every organisation in South Africa.
PURCO SA has made great progress in both these related areas, and we are proud to have raised our B-BBEE score from level 2 to level 1.
We are rolling out a major project to contribute to the country’s economic upliftment by developing our suppliers so they in turn can grow their businesses.
Our tenders have now become so broad that we are procuring from traders such as plumbers and electricians. While they have the technical skills we need, they often lack the ability to successfully apply for tenders or manage the paperwork and cash flows that are crucial for running a business.
We believe higher education institutions have a duty to lead in empowering previously disadvantaged individuals through supplier and enterprise development. It is also a BEE scorecard requirement for our members as well as ourselves..
Procurement is key in Higher Education scorecard
Our members are judged according to the Specialised Generic Scorecard for higher education institutions, with procurement carrying 50 of the total B-BBEE points. Of these 30 points are dedicated to preferential procurement, 15 to supplier development and 5 to enterprise development.
PURCO SA is determined to create a structured skills development initiative to meet those demands.
During the past year we studied how other institutes, companies and government organisations handle supplier development so we can shape our own strategy in consultation with members. The Supplier and Enterprise Development (SED) Study Report is available to members.
Some of the organisations we studied could help by setting up business development centres in or near our members’ institutions, or mentor and coach our suppliers on an outsourced basis on behalf of our members.
The next phase will use our findings to test training models and implement a pilot project where challenges and areas for improvement can be identified and addressed.
SED programmes must be tailored to the specific challenges faced by different suppliers. This requires pre-screening to assess suppliers’ level of skills and knowledge before determining the training best suited for them.
The skills our suppliers need help with include computer and software training, finance and marketing, handling documents such as income statements, cash flow statements and balance sheets, understanding procurement processes, developing business proposals, and improving the quality of the services or products they supply.
Phase Three will see members establish and implement their own Supplier and Enterprise Development programmes either by outsourcing the task, running it themselves, or participating in the PURCO SA SED programme.
One of the biggest challenges faced by black businesses is reaching the service and quality levels provided by more established market players.
Skills transfer is an important element of SED, and our programmes will encourage established businesses to contribute to the development of black companies.
Members should also look at incorporating mentorship and coaching into their SED programmes, as this may be key to their success.