Finance and Economic Opportunities
- (a) What is his Department’s Township Revitalisation Strategy, (b) what is its (i) rationale, (ii) objectives, (iii) budget and (iv) implementation model and (c) can copies of the strategy document and supporting documents be made available;
- whether the Pick n Pay (PnP) supermarket stores is the only project of this Township Revitalisation Strategy; if not, why not; if so, (a) what are the relevant details, including, (b) how many PnP stores have been implemented, (c) in which townships have they been implemented since the implementation of the strategy, (d) what criteria were used to choose them and (e) what is the performing status of each to date?
- [a] [b] [i] [ii] [iii] [iv] [c]
Enabling and developing township-based businesses is a priority of the Department of Economic Development and Tourism [DEDAT] and is largely done through our Enterprise Development Programme. We have been working on a Township Economic Growth Strategy which will be reviewed as part of a larger Western Cape Economic Growth Strategy.
- The Pick n Pay [PnP] supermarket stores project is part of DEDAT’s Enterprise Development Programme.
[a] What are the relevant details?
The Pick n Pay Market Store project involves the conversion of existing spaza shops within townships into independently owned mini supermarkets. The initiative involves improving infrastructure [building, machinery and equipment] in the township retail sector. The department provides financial assistance to qualifying beneficiaries in the form of grant funding to facilitate the refurbishment of the market stores.
[b] How many PnP stores have been implemented?
To date, a total of eight stores have been opened.
[c] In which townships have they been implemented since the implementation of the strategy?
|
STORE |
AREA |
OPENING DATE |
|
Gugulethu |
November 2017 |
|
Nyanga |
December 2017 |
|
Blue Downs |
September 2018 |
|
Mbekweni |
August 2019 |
|
Langa |
August 2020 |
|
Langa |
August 2020 |
|
Delft |
February 2021 |
|
Chicago [Paarl] |
March 2021 |
[d] What criteria were used to choose them?
Pick n Pay engages with the various forums, business chambers and similar organisations to identify potential entrepreneurs and suitable sites to establish a market store. Pick n Pay conducts an assessment on the entrepreneur to ensure suitability and a feasibility study on the proposed site [this includes the zoning of the property and adherence to relevant by-laws] to ensure its viability. The selection of the appropriate entrepreneur and site is critical to the success of the initiative.
Once this process has been completed and the applicant and site are considered suitable, a financial check is conducted. The grants from the department [R500 000, 00] and Pick n Pay [R550 000, 00 – R650 000, 00] cover between 30% and 40% of the set-up cost. The balance of the funding required is obtained through development loan finance. To this end, Pick n Pay has formalised memorandums of understanding and formal agreements with financial institutions to offer development finance to the market store operators. These institutions include the Small Enterprise Finance Agency [Sefa], the National Empowerment Fund [NEF], Nedbank and ABSA [with other banks also being accessible].
[e] What is the performing status of each to date?
The figures below are as at 31 March 2021:
|
STORE |
EMPLOYEES |
TURNOVER [Apr 2020 – Mar 2021] |
|
Not currently trading [will potentially employ 15 people][1] |
R6,7 million [up to Feb 2021] |
|
40 |
R34,2 million |
|
26 |
R14,7 million |
|
38 |
R29,5 million |
|
18 |
R5,1 million [August 2020 – March 2021] |
|
12 |
R4,1 million |
|
23 |
R922 032, 00 [February and March 2021] |
|
26 |
R408 192, 00 [March 2021] |
|
Total |
185 |
|
[1] This is a temporary closure as the store is being relaunched later this year with a new owner.
