Entries by Rika du Plessis

Part 9 – The BEE investment decision

Is ownership the cheapest form of BEE? One of the most highly experienced BEE consultants we work with said recently that in her opinion ‘BEE ownership is the cheapest form of BEE and makes more sense than anything else on the scorecard’. How true is that statement? As a recap, transformation is measured across a […]

Part 1 – Executive Summary

  All businesses operating in South Africa must decide what strategy they will follow with regards to Black Economic Empowerment (BEE) – a set of laws that aim to ensure political stability through meaningful participation by black people in the economy. Although unpopular, BEE isn’t going away soon – the transformational need is still very […]

Part 8 – BEE Customer research

You would probably be surprised to know that most of the companies we meet at Tusker ‘want to do a BEE deal’ but haven’t figured out whether it’s actually worthwhile or not. Without this perspective, making an investment decision is near impossible; any proposal to do such likely to get shot down by shareholders or […]

Part 7 – Turning BEE into long-term strategic advantage

The story so far: B-BBEE is a set of policies designed to achieve political stability by incentivising the participation of black people in the SA economy. Each company gets a BEE score, measured against a BEE scorecard specific to the company size and industry. The SA government awards contracts based on a combination of quality/price […]

Part 4 – The SA economy in a nutshell

  From a population of ±57M people, South Africa has ±3.1M registered companies. So far, so good. However, only ±850K submit income tax returns to SARS (the balance being considered dormant). 76% of these active businesses are companies with 18.4% individuals. Of these 850K, 774K were registered as VAT vendors but only 504K is registered […]

Part 6 – Unpacking the BEE scorecard

BEE is customer driven: BEE trickles down from government tenders to suppliers to their suppliers. The reality is that BEE scorecards matter mostly to your customers. Your scorecard determines how much ‘recognition’ your customers get from trading with you, which means that they are incentivised to spend more with companies who have higher BEE scores. […]

Part 5 – To BEE or not to BEE?

BEE isn’t compulsory, but it’s hard to avoid: While not compulsory, BEE affects every company trading in South Africa. The reason for this is that the Govt uses its massive procurement budget to force its suppliers to compete on a combination of BEE points and price (BEE counts for 10% or 20% of the tender […]

Part 3 – Is BEE going away?

  We’re frequently asked if B-BBEE is going away. The reality is that it’s here to stay – but likely to be changed/modified along the way. This article is an NB read for those who’d like to believe they can put off BEE until some magical future date – we think (for all the reasons […]

Part 2 – The need for BEE

South Africa is the worlds’ most unequal country: One of the legacies of South Africa’s history of racial discrimination and policies is that a large portion of the population has been excluded from the economy and denied the opportunities to fully participate and benefit from it. New analysis by the World Bank has confirmed that […]