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CHAPTER 5
SUPPLIER RELATIONSHIP MANAGEMENT
The following are the prime objectives of the BBSDP scheme [21]:
• Fast-tracking existing Small, Medium and Micro Enterprises (SMMEs) that
show good potential for growth into the mainstream economy.
• Growing black-owned enterprises by fostering links between black SMMEs
and corporate and public sector enterprises.
• Complementing the current affirmative procurement and outsourcing
initiatives of corporate and public sector enterprises.
• Enhancing the capacity of grant recipient enterprises to successfully compete
for corporate and public sector tenders and outsourcing opportunities.
BBSDP is meant to assist small enterprises to improve their competitiveness
and sustainability so that they can become part of the mainstream economy for
the purpose of creating employment in the country. This is achieved through
the provision of financial assistance in the form of grants that are worth up to
R1 million. Some of the provisions are as follows:
• Funds may be granted for the acquisition of tools, machinery and equipment
per each eligible enterprise. Businesses need these non-human resources
for their production processes. The scheme is therefore meant to ensure that
targeted businesses are well equipped to make meaningful contributions to
the economy by boosting their production capacities.
• Funds may be granted for business development and training purposes per
eligible enterprise. The money may be directed towards the improvement of
corporate governance procedures, management, marketing, productivity and
the use of modern technology. This is premised on the fact that it is widely
acknowledged that businesses can only succeed when their employees are
well equipped with the necessary knowledge and skill in these critical areas.
In order to be eligible for a grant, applying enterprises have to meet the following
criteria:
• Black majority shareholding of at least 51%. This is in line with the BBBEE
initiatives that are meant to promote the development of the country by
recognising the needs of previously marginalised groups. This will ensure that
all groups will be able to make positive economic contributions to the country.
• Fifty percent of management positions should be held by historically
disadvantaged individuals. The scheme is meant to assist businesses whose
management structure reflects the desire to address the historical imbalances
in the country. Therefore, to qualify for the scheme businesses are encouraged
to factor in a majority black management.
• Annual turnover of the enterprise should be between R500 000 and R35
million. The required turnover aims at ensuring that only serious enterprises
that have a bright future receive the grants from the scheme.
• The business should be in operation for at least one year. This eliminates
the prospect of giving the funds to fly-by-night businesses that have been
started to obtain the grant, but do not exist in reality.
• Proof of payment of VAT, indicating that the business has been registered and