Soweto: With the launch of the R500 million Spaza Shop Support Fund (SSSF), the government is set to support entrepreneurs aiming to establish startups, expand their businesses, and acquire essential business skills to enhance their enterprise performance.
According to South African Government News Agency, the initiative was announced by the Minister of Small Business Development, Stella Ndabeni, in an effort to encourage the formal registration of spaza shops.
The registration drive has so far attracted 87,407 applications, with 53% of these from South African-owned spaza shops. Minister Ndabeni emphasized the government’s commitment to support those who registered their businesses, offering help from startup incubation to formal trading and even owning wholesale or distribution channels.
The SSSF, launched on Tuesday in Soweto, aims to bolster South African-owned township convenience shops, including spaza shops, by increasing their participation in retail trade within townships and rural areas. The fund is jointly administered by the National Empowerment Fund (NEF) and the Small Enterprise Development Finance Agency (SEFDA), providing both financial and non-financial support to these businesses.
The fund covers various types of support, such as the initial purchase of stock, infrastructure upgrades, and training programs in business skills and compliance. According to Minister Ndabeni, the fund seeks to mitigate economy of scale disadvantages by linking spaza shops to buying groups, building business capacity through training, and enhancing market competitiveness.
The SSSF will be implemented nationwide, aiming to impact spaza shops across major townships and rural areas. The government also plans to localize supply chain opportunities for township and rural enterprises, reducing dependency on imported products and large company platforms.
To achieve this, the government will use additional programs like the Small Enterprise Manufacturing Support Programme and Township and Rural Entrepreneurship Programmes. These initiatives aim to attract collaboration from municipalities, the private sector, and business associations to support local supply chains and distribution networks.
Additionally, logistics management partners will offer services to improve supply chain efficiency, reduce costs, and ensure safe product storage and delivery.
The Department of Small Business Development (DSBD) has also recruited 52 Business Regulation Officers to aid business registration via the DSBD Connect system, a platform designed to encourage collaboration among small businesses.
Minister Ndabeni acknowledged the challenges faced by spaza shops, including capital access, security concerns, and competition from larger retailers. She urged shop owners to collaborate and establish cooperatives to leverage resources and share best practices.
For those interested in accessing the funding, applications can be made through the NEF and SEFDA via their respective websites. Contact details for further inquiries are provided for the Spaza Shop Support Fund, NEF, and SEDFA call centers.