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LRA BBSDP Presentation Final
- 1. BBSDP (Black Business Suppliers Development Program) BBSDP is a grant offered by the Department of Small Business Development… • The BBSDP is a cost-sharing grant offered to black-owned small enterprises, to assist them in improving their competitiveness and sustainability, in order to become integrated into the main economy. • It provides grants to a maximum of R800 000 for tools, machinery and equipment, and R200 000 for business development and training interventions per eligible enterprise, to improve the business’s corporate governance, management, marketing, productivity and use of modern technology. Letlotlo Ranyathole and Associates 1
- 2. Eligible Enterprises To be eligible, enterprises should satisfy the following criteria: 50+1% black majority shareholding (Foreign Nationals must have been naturalized prior 27 April 1994 to considered as PDIs`) R250,000 to R35 million turnover per year 1 year in operation & trading as a business 50% management positions held by blacks VAT registered compulsory only for companies with annual turnover +R1million. Letlotlo Ranyathole and Associates 2
- 3. Continues… Qualifying enterprises are eligible to receive a maximum of up to R1m grant. Enterprises will receive grant value of 30% for the current turnover Cost Structure is as follows: Max R800 000 being ring fenced for tools, equipment and machinery) – 50 : 50 % cost sharing. Max R200 000 being ring fenced for business development services and training – 80: 20 % cost sharing. Letlotlo Ranyathole and Associates 3
- 4. Eligible Expenditure For Enterprise Support Services (ESS) interventions, the BBSDP will offer a cost-sharing grant of 80% of the approved costs of qualifying interventions, and approved enterprises will contribute 20% of the necessary costs (for business development services and training). The maximum grant will be R200 000 With regard to tools, machinery and equipment, the BBSDP will offer a cost sharing grant of 50% of the approved costs of qualifying equipment, an approved enterprises will contribute 50% of the necessary costs. The maximum grant will be R800 000 Letlotlo Ranyathole and Associates 4
- 5. Calculation and Payment of Incentive Benefit Is calculated on a 80:20 ratio for ESS (business development and training support services) BBSDP will cost share on a 50:50 ratio of the cost of the equipment or R800 000, whichever is the lesser Where a client qualifies for R1 000 000, the amount can be divided as follows: Department will pay R200 000 x 80% = R160 000 (ESS) R800 000 x 50% = R400 000 (Tools, machinery and equipment) Client will pay R200 000 x 20% = R40 000 (ESS) R800 000 x 50% = R400 000 (Tools, machinery and equipment) Letlotlo Ranyathole and Associates 5
- 6. Examples of Enterprises Support Services Specialised Software Business process reengineering Management Information Systems Quality Assurance (ISO, certifications, accreditations, health and safety policies) Patenting & intellectual property rights Production & Productivity Improvements Product Improvements and product testing Letlotlo Ranyathole and Associates 6
- 7. Continues… Interventions that qualify are those aimed at improving the effectiveness of the management systems of an enterprise… Company diagnostics; Business Plan to raise finance Management information systems (including production, sales, accounting software); Quality management systems and assurance (e.g. International Organisation for Standardisation (ISO), certification, accreditation, grading costs); Patenting and intellectual property rights; Production and productivity improvements; Product improvements; BEE rating and certification; and Merger (majority shareholding) and acquisitions Letlotlo Ranyathole and Associates 7
- 8. Application Procedure Documents required for the submission of applications to DSBD: Proof of ownership of the enterprise (CIPC eg. Ck1, CM9 etc.); ID Copies of owners and employees Signed financial statements or management accounts A completed application form; PSC report (to be conducted pro-bono by network facilitators); Company diagnostic report; (to be conducted pro bono by network facilitators); At least three (3) quotations A valid tax clearance certificate Support letters/orders/contracts for goods and services to be supplied With regard to tools, equipment and machinery, financial capacity of enterprise to fund the project or Letter of intend from a 3rd party. Letlotlo Ranyathole and Associates 8
- 9. Monitoring and Reporting All approved interventions will be monitored to assess how the BBSDP is contributing to the stated development outcomes. The BBSDP Secretariat will undertake post-approval site visits for progress reports (on a bi-annual basis). An Intervention Monitoring Report will be completed as part of this process. Letlotlo Ranyathole and Associates 9
- 10. Thank You… Contact Details: Kenneth Ngake Cell: 078 052 2067 Office: 081 365 9792 [email protected] [email protected] Office Address: Harmony Business Development Centre Farm Mealie Building No. 49 Alma Road Welkom Letlotlo Ranyathole and Associates 10