fbpx Skip to content

Enterprise and Supplier Development ESD FAQ

What is the difference between enterprise development and supplier development?

Both enterprise development and supplier development are elements of the B-BBEE scorecard. In terms of supplier development, the corporate is required to support the growth of the entrepreneur’s business with either non-financial or financial assistance or both. (Non-financial support includes providing business development services either directly or through a third party such as Raizcorp.) The corporate is also required to procure goods or services from the supplier they are developing, which is what differentiates it from enterprise development. Enterprise development does not require the corporate to procure from the entrepreneur they are developing. However, Raizcorp is of the view that all enterprise-development beneficiaries should be selected to become possible future suppliers to their corporate sponsors

How can my organisation contribute towards enterprise development and supplier development?

Your organisation’s enterprise development and supplier development contribution is a percentage of your net profit after tax. (This is normally 1% for enterprise development and 2% for supplier development.) The rand value equivalent is used to purchase bursaries for selected black-owned companies to enter one of our many Raizcorp Arize programmes. 100% of your spend is attributable to B-BBEE points on your scorecard

Can you provide an example of enterprise development?

Raizcorp believes that enterprise development needs to be strategic and, for different companies, this means different things. An example of an enterprise development project would be for a corporate sponsor to support a business in their surrounding community, or to support a company in their channel to market (distributors or resellers). One of the most popular forms of enterprise development is for a corporate to support a small business that could become a supplier in future. The conversion from enterprise development to supplier development attracts an additional point on the B-BBEE scorecard

Can you provide an example of supplier development?

There are two major supplier development categories:

  1. Suppliers who supply a corporate with input into the products or services they offer (for example, a business that produces a part for a motor vehicle that the corporate manufactures)
  2. General suppliers to the corporate that are not an input into their products or services (such as cleaning services or stationery)

Are there any additional costs if an organisation uses Raizcorp for enterprise development or supplier development?

No, there are no additional costs to your ESD spend and 100% of that spend is attributable to the B-BBEE scorecard.