At a time when there is increasing pressure on the retail motor industry to transform, SAMBRA, the South African Motor Body Repairers’ Association, a proud Association of the RMI, have just released its latest BBBEE stats showing of its total membership 94% hold a BBBEE ranking of between Level 1-4. Significantly, 51% of these members hold a Level 1 or 2 BBBEE ranking.
According to Richard Green, SAMBRA National Director, SAMBRA has been actively driving to open up the market to historically disadvantaged individuals by removing barriers to entry. This drive is supported by the Automotive Code of Conduct which encourages inclusion into an OEM network of motor-body repairers and encourages specific measures to provide the necessary subsidisation of capital, facilities, tools and equipment and training.
Green says opening up access to insurer supplier listings and OEM approval systems will go a long way to addressing this issue and is in fact critical to all businesses within the sector, as is the funding.
At present there are approximately 120 black-owned and registered businesses within SAMBRA that require substantial assistance to graduate into the formal sector and this can only be achieved with substantial assistance in terms of finance and business management incubation. There are at least another 1,200 that operate outside of registered associations such as SAMBRA.
The challenge is always bigger for these small formal businesses that supply services to the insurance industry. “Remember that only approximately 30% of the vehicle car park in SA is insured. So the formal MBR sector all chase that business. This is complicated by the fact that insurers and manufacturers restrict the size of their ‘panels’. Small black businesses, fully compliant with set standards, find themselves being precluded from accessing business just because the insurers and manufacturers say they have ‘sufficient’ suppliers in an area. SAMBRA argues that: “surely if I am prepared, as a business person, black or white, to accept the investment risk and comply with accreditation criteria set by insurers and manufacturers, it is restrictive business practice to preclude me from servicing my clients?”
Current businesses, that have in some cases spent 20 to 30 years cultivating loyal clients, are precluded from doing so simply because the MBR business is not on the manufacturers approved listing or insurer supplier listing!
“We are developing a model within which corporate, state, quasi state and other related entities like the AIDC which is in a position to add value by financing new entrants can all participate. Presently, these entities do not collaborate with one another or seek out the experience and market knowledge of organisations such as SAMBRA to ensure the available resources are spent wisely. I have personally seen many millions of rands wasted and this can be avoided by using the collective wisdom and resources wisely,” says Green.
SAMBRA, in collaboration with SIYAKHA will hold an Enterprise Development conference at Emperors Palace on Thursday 17 October and it is hoped that the participants will emerge with a plan to achieve the ESD goals within the MBR sector.
“SAMBRA will continue to transform and develop black business owners in the sector but will need support from the industry to sort out problems with ownership and preferential procurement,” he concludes.