Coca-Cola Beverages South Africa (CCBSA) is transforming its supply chain to create new opportunities and develop its black-owned SME suppliers.

Responding to South African President Cyril Ramaphosa’s call to businesses to help accelerate inclusive economic growth and create jobs in the country, Coca-Cola Beverages South Africa (CCBSA) announced the launch of a R100m (approx. US$ 7m) SME Supplier Development Fund at their annual Supplier Development Conference recently.

 “Most SMEs struggle to access finance when running their businesses,” says CCBSA’s Financial Director, Walter Leonhardt. “The fund will release R20m over five years at preferential rates to help existing black and black female-owned SME suppliers access the funding needed to deliver on new and existing contracts.”

The company is also partnering with other fund managers to make it easier for smaller suppliers to access other funding sources.

By collaborating with various partners, including other fund managers, the company has made progress on transforming its established procurement ecosystem within a short space of time, to help establish an inclusive growth model in South Africa.

CCBSA Managing Director, Velaphi Ratshefola, says spending on black-owned SMEs more than doubled from 10% in 2016 to 21% in 2018. The percentage spend on black-women suppliers improved from 3% to 10% in the same period. These numbers are set to increase in 2019 with 85 Requests for Proposals (RFPs) being issued, presenting more opportunities for black suppliers.

CCBSA also diverted R3.9 billion of procurement spend to transformed suppliers over three years. In Year One, R1.5 billion of the company’s procurement spend went to black and black female-owned companies, exceeding targets by R200 million. It is well on its way to achieving its goal of becoming a Level 2 broad-based black empowerment contributor by 2021.

By promoting localisation within its own business, CCBSA has helped broaden and deepen South Africa’s pool of world-class suppliers – especially in the manufacturing sector. 

Manufacturing is seen as key to re-igniting economic growth as it has the highest multiplier effect on the economy. 

Procurement Transformation Manager at CCBSA, Busi Thusi, emphasises the importance of supporting the sustainability of suppliers.

“We work with a number of partners to help suppliers at all phases of their life cycle to help improve their business practices, so they can continue growing profitably.”

Through the collaboration with partners, CCBSA remains focused on creating opportunities for various communities through the transformation of its supply chain to help ignite inclusive growth in South Africa.

“CCBSA has made massive commitments to spur the growth of existing companies within its own supplier ecosystem, and to provide the right conditions to incubate new entrepreneurs. We know that we can only grow if our communities and economy grows with us. This fund is just one example of how our company is doing business the right way to create shared opportunity for growth,” Velaphi concludes.