2. 2
What is ESD?
Enterprise and Supplier Development (“ESD”) is not a South
African concept, but rather a global movement that has
proven its ability to stimulate economies, diversify supplier
chains and create jobs
In SA, it is the fifth and most significant element of the BBB-
EE Codes and accompanying scorecards
Its aim is to uplift EME’s (turnover <10mil) and QSE’s
(Turnover 10-50mil) in corporate supply chains (SD) and
general (ED) through financial and non financial support
Effective ESD comprises of Growth Support and Programs as
well as ESD Funding
Corporates (measured entities) are required to achieve a
minimum of 40% of the total targets of the 3 subcategories
of ESD i.e Enterprise Development (ED), Preferential
Procurement (PP) and Supplier Development (SD)
3. 3
ESD – Programs and Growth Support
Consists of specific programs as
well as generalist and specialist
support
Customised solutions (through
individual diagnostics) are key to
an effective Growth support
strategy and Program
Can be used as a spring board to
investment readiness through
interactive mentorship and
planning
Entrepreneurs should use this non
financial support as a mean for
developing a differentiated
business model
4. 4
HEADERESD – Funding
Access to Finance
• Catalytic Funding (terms,
collateral requirements,
Support)
• Catering to the missing
middle
• Growth business that are
able to absorb gearing
• Strong informed Teams
with track record
Access to Market
• Corporate Supply chain
integration
• Preferential procurement
from investee companies
• Networking opportunity
with corporates as well
as peer investees
Access to Skills
• Rigorous post
investment support
strategies
• Upskilling of
entrepreneur and
organisation through
specific projects
• Appointment of industry
specific mentors and
coaches
5. 5
Your Game Plan
EDUCATE
PREPARE
EXECUTE
• Identify ESD Service
providers
• Understand your business
needs (Financial or Non
financial)
• Align yourself to applicable
charters and accompanying
corporates
• Practice your Pitch
• Understand your numbers
and your differentiator
• Get your pricing right
• Make your list
• Check your compliance and
ensure your house is in order
• Be and Think investment
ready
• Identify and approach the
right stakeholders
• Reach out to ESD Providers
that are aligned to the
corporate you want to or
currently have access to
• Ask questions and feedback
to the ESD Funder and the
corporate
Where/how does what you do on a daily basis, fit into the broader ESD Framework?
We work with SMEs to get them contract ready and skills ready. Our business is called Access and we aim to improve access to market and finance for SMEs. We do this by running ESD programmes for corporates. On a daily basis I manage a team of business coaches and specialists that are SME facing, also report back to corporate sponsors on the status of each of their programs.
The challenge of the new codes is to get SMEs into corporate supply chains, the shift from ED to SD. It is difficult for an SME to:
Find the right entry point into a corporate,
Know when tenders are sent out,
Register as a vendor,
Price correctly,
Pitch,
Meet key requirements like SHEQ,
A program can help with all of these.
If you were an entrepreneur, knowing what you know about the Programmes and Growth support space:
How would you use what’s on offer to benefit your business?
I would use the programme to gain insights and skills on areas that I am weak at.
If I am strong I can use the program to upskill my next level of management.
The programme allows to network with other business owners
Access to supply chain people from corporates.
Other SMEs are potential customers.
Through the people profiling I get to understand myself and my team better.
SMEs can get feedback on why their proposals failed.
What would you consider the 2 main challenges to successfully accessing the support offered?
Capacity: As a small business I am stretched between sales and delivery and don’t feel like I have the capacity to grow myself, I am too busy working in the business rather than working on the business.
Cashflow: I have a constant pressure to earn cash, and wonder if I will survive the next few months. This affects my mindset and energy levels and makes it difficult to focus on learning to be a better entrepreneur -the conflict between urgent and important.
What are the practical solutions to these challenges?
Capacity: Unfortunately no easy fix here, except for better prioritisation to focus on the activities that give you more bang for your buck-sometimes this means saying no to some tendering opportunities, and firing clients where margins are too low. If you understand your personality profile, you can also ensure that your next hire can help debottleneck you.
Cashflow: The basics here-most entrepreneurs think that sales will take care of this. This is not true. You have to focus on invoicing, and collections as well. As an SME as corporates if they have a 7 day settlement for SMEs, make sure you have invoice details and format correct the first time. Once you submit and invoice, follow up whether it was received and whether it is correct. And follow up 7 days later on when payment will be done.
