I need to present this concept to appropriate executives at Government and other stake holders.
I am horrible at graphic designing and journalism.
Exploring options to improve and communicate this message to a relative small but extremely important audience.
Will more than likely include members of parliament?

I trust that the text and graphics together can provide sufficient insight.

Non-existent emerging deep rural FMCG retailers in deep rural Vhembe Limpopo province
In deep rural Vhembe Limpopo province lives 1.4 million people. 94 % of the are local black people mostly unemployed and struggling informal traders. Formal FMCG (Fat Moving Consumer Goods ) retail in deep rural Vhembe is dominated by foreign retailers. They own around 90 % of formal stores in deep rural villages, represent 2.5 % of the population and is mostly from Moslem religion
Their informal but formidable support mechanism is closed to the black population.

Government since 1994 has many small business development platforms none of which is functional to facilitate appropriate support of independent retailers. We own several deep rural independent SPAR stores and are part of the SPAR voluntary trading organisation with 15,000 sustainable members globally.

Substantial progress has already been made with the conceptualisation and development of a turnkey and TradeReady business based on Corporate Shared Value for the rapid development of competitive and sustainable, emerging FMCG retailers in deep rural Vhembe.
Corporate Shared Value today globally represents future thinking and originated from the guidance of the world’s leading analyst Professor Michael Porter.
CSV associated with deep rural FMCG retail is developed by Johan Esterhuizen already a successful SPAR member and owner of several deep rural stores
CSV support refers to instant alignment of emerging deep rural retailers with the value chain, retail technologies, deep rural logistics, distribution, collective bargaining, training etc. Of SPAR the world’s largest independent retailer network.
CSV alignment and support of emerging deep rural retailers constitutes the only feasible strategy for emerging deep rural retailers to confront entry barriers and compete sustainably with dominating foreign retailers and now also corporate low cost modular FMCG retail stores ready to decimate any NDP 2030 visions for deep rural emerging retailers.
The German Aldi low cost retail model copied by Shoprite and rolled out as USave in the LSM 1-3 deep rural market segment according to analysts has put 35,000 independent businesses out of business in Germany alone.
I have been involved in a family security business in deep rural Vhembe Limpopo since 1998. Our customer base includes 2000 + alarm systems in Vhembe many in deep rural formal FMCG businesses dominated by foreign retailers. I have developed valuable insight of how foreign migrant retailers for many years now migrated to deep rural Vhembe.
I have been a dedicated student of Professor Michael Porter since 1993.Prior to 1998 I I qualified as a teacher in 1980 but was since 1983 became mostly involved in FMCG retail in various positions including Checkers Manager , supplier , National Sales Manager , student and lecturer in Category Management . When I arrived in Vhembe in 1998 my family had already invested in alarm / electronic security and had 43 alarm systems. A market analysis based on the guidance of Prof. Porter prompted me to change our business model which eventually saw our customer base grew to 2000 today.
In 2006 I together with my brother In 2006 I opened Elim SUPERSPAR the 1st of our independently owned four SPAR stores and two Tops Liquor stores. This market segment is in essence LSM 1-3 but much more lucrative than most people think. (The largest SPAR in the WORLD is situated in Thohoyandou in Vhembe. Many deep rural people however are deprived of affordable mobility and normally will normally travel to rural shopping Malls around grant payment days. For a extensive number of days they are still forced to shop at dominating foreign retailers.
Origination of dominating deep rural foreign retailers
Dominating foreign retailers represent around 3% of the population but has been migrating to deep rural Vhembe for many years. Their retail success I believe originated already many years back as a sustainability strategy among established foreign WHOLESALERS.

This involves a informal but formidable support mechanism among foreign retailers that includes features such as

Subsidising migration from country of origin
Hosting by a local family who shares the same cohesive religious affiliation. A religious cohesion that extends to business.
Support with accommodation upon arrival.
Support with immediate employment in a deep rural FMCG business
Training in a deep rural store
Support with the set up and funding of a own deep rural store once fully trained.
Support through the benefits of collective bargaining.
Support with balancing of stock among retailers consulting among each other on business matters after every day's meeting at a local mosque.
The sustainability benefit for foreign wholesalers is that a foreign retailers only buy from them.
The migration support deep rural retailers receive is also multiplied by them by hosting future arriving migrant retailers.
According to me the cumulative monthly sales by deep rural foreign retailers exceeds R300 million.

For almost 50 years now local people have been EXCLUDED from the above support dynamics and still are excluded. This is a closed community. Now where globally does INDEPENDENT FMCG retailers exists without being aligned and the support mechanism such as associated with i.e SPAR. All other dominating FMCG stores belongs to dominating corporates such as Wal- Mart , Tesco , Pick n Pay , Shoprite , Carrefour , Asda , Makro.

Emerging FMCG retailers from bad to worse.
Emerging FMCG retailers in rural Vhembe does not exist.
In Germany Aldi a low cost retail model originated in 1940. Globally the Aldi business model with 10, 000 stores has been copied by several corporates with great success. Low cost retailers include stores such as LIDL (10, 0000) Netto, Penny Market etc.
Key features associated with the low cost retail are low set up costs , a narrow product range , rapid stock turns , maximum numbers of house brands for increased margins ( 10 -15%) . This features together culminates into a R.O.I of around 50 %.
Retail analysts claims that the low cost retail model in Germany were not only instrumental in the ENTRANCE AND EXIT of Wal-Mart in Germany in 5 years BUT ALSO was the main cause for 35,000 independent businesses GOING OUT OF BUSINESS in Germany ALONE.
In South Africa the ALDI business model has been copied by Shoprite as USave around 2012. Having captured the LSM 4-7 ( Shoprite ) and LSM 8-10 ( Checkers ) FMCG market segments they were looking for a formidable low cost retail model to extend their chokehold from the LSM 4- 10 FMCG segments to the LSM 1-3 essentially deep rural markets. Whithey Basson prior to his departure confirmed plans for 1000 + USave stores without cannibalising any their other store. Demographics has been done to calculate the ranking order for expansion into the deep rural market starting with the most lucrative locations first. Currently USave already serves 5.5 million deep rural customers .
Unlike the LSM 4-7 and LSM 8-10 segments already captured by the group these segments has become heavily contested whilst according to Shoprite the LSM 1-3 essentially deep rural market represents for the group " Greenfields " with a double digit growth potential.

Consequences for deep rural LSM “emerging retailers” and informal traders.
Where Government envisage the radical economic empowerment of formal retailers especially in deep rural areas such as Vhembe in Limpopo and in the continued absence of appropriate support this vision is most likely to be DEFEATED especially by dominant foreign retailers being joined by USave in competing for this lucrative and growing segment.. FMCG retail recently has exceeded the one trillion rand mark. Given the above circumstances continuing uncontested it is more than likely that the poverty cycle associated with deep rural informal traders will continue for generations to come. If left unattended a likely outcome in the future may include violent Xenophobia especially in deep rural Vhembe communities such as Vuwani where in 2017 26 schools were burnt because of a much lesser dispute.
According to me the only solution originates from Corporate Shared Value a strategy by Professor Michael Porter and Mark Kramer I have studied since 2012. I have already started with the conceptualisation of CSV support in association with SPAR. With SPAR being a voluntary trading organisation with almost 1000 sustainable and competitive members in South Africa and 14,000 globally in 18 countries such an initiative needs to originate from members such as our family.

7 Million Bread. ( Deep rural market potential )
In 2016 our children in anticipation of the retirement of my brother Chris and me our children took over the management of our store. Chris and I bought a suitable premises being a old SASKO Bakery in Elim in rural Vhembe.
Our transaction with Pioneer Foods included the purchase of the entire SASKO Elim deep rural fleet and distribution of SASKO bread in both the corporate FMCG market in Louis Trichardt (Makhado) , Elim and the deep rural villages on 10 deep rural routes around Elim.
To date we have distributed 7 million loaves of bread in this market where we have around a 25% market share competing against Sunbake, Albany , Blue Ribbon , Boxer ( Pick n Pay ) and a host of independent bakers.
What is most revealing is the fact that in this time I have been able to confirm various facts based on essential analysis. Of 7 million bread almost 74% has gone to deep rural villages. If this sales and volumes is true about bread a LSM 1-3 essential product it is also true for the entire LSM 1-3 grocery essentials basket.
Sustainable CSV support by a FMCG global competitor in a retail industry that has exceeded one trillion sales in South Africa .
As SPAR members we have access to ALL the resources required for competitive and sustainable FMCG retail available to share with emerging rural retailers in deep rural Vhembe which can ultimately be replicated elsewhere..
CSV FMCG retail support unlike uncoordinated and fragmented " support" received by deep rural emerging retailers since 1994 will include :
1. Alignment of SparZa deep rural stores through us with the entire value chain of SPAR
2. Access to formidable and mature logistics including deep rural “last mile" logistics.
3. Weekly deep rural { last mile logistics ) delivery of a narrow and dedicated product range that will optimise stock turn a essential feature associated with sustainable FMCG retail. ( Since 2016 we have confirmed that we could do in excess of 300,000 deep rural deliveries of bread ) a critical resource and value we will share.
4. Access to sophisticated FMCG retail technologies i.e , Category management , housebrands , promotions ,marketing , advertising , collective bargaining , dedicated training , competitor analysis , corporate branding , FMCG IT technology , the benefits associated with economies of scale , dedicated operational monitoring and support , dedicated retail training associated with a unique , tried tested low cost FMCG retail business plan.
5. Operational support including demographic research, building (local manufacturing employment) and installation of turnkey TradeReady SparZa stores.
6. Corporate branding with Category Management technology to establish their stores as preferred shopping destinations in deep rural villages.
7. Sharing of dedicated competitor analysis and appropriate strategies.
8. Support with rivalry analysis and appropriate response in a competitive industry.( Porter 5 Forces of competition )
Support with the bargaining power of suppliers. (Porter 5 Forces of competition)
Support with the threat of new entrants.( Porter 5 Forces of competition)
Support with the threat of substitutes. (Porter 5 Forces of competition)
Support with the bargaining power of substitutes
9. Independent ownership of ALL stores. ( SPAR does not own stores .Globally SPAR consists out of voluntary members
10. Development of funding models in association with Government etc. where the store , stock , assets etc. serve as surety.
12 Development of modular stores (like USave ) that can be moved , expanded etc.
Corporate branding , affordable and appropriate retail , systems , equipment , point of sale materials , IT technologies , money transfer facilities , social coupon facilities , incorporation in sophisticated procurement systems , incorporation in sophisticated accounting systems. loyalty card systems etc.
13. Development of extra streams of revenue. ( i.e Concepts developed by SPAR retail experts , piloted and the rolled out by members in communities where such need has been verified and exists.
14. Involvement of SparZa members in "Look and Learn” initiatives organised by SPAR.
15. Involvement of SparZa members in regular SPAR trade shows with exposure to multiple suppliers , evolving technologies etc. including the benefit of economies of scale associated with FMCG retail assets.
16. Participation in regional and National SPAR promotional , advertising and marketing themes and initiatives
17. Support associated with the development of SparZa as a MULTIGENERATIONAL opportunity involving the accumulation of assets and opportunity for following generations.
18. CSV support associated with perpetual FMCG retail store development , systems development ,
19. CSV support associated with the optimisation of customer counts , basket spend , traffic building technology , transaction building technology , product development etc.
20. Every SparZa owner will have the prospect of multiple SparZa stores including the possibility to upgrade to a SPAR or SUPERSPAR stores if such an opportunity arise.
Conceptualisation of CSV for emerging deep rural FMCG retailer support concept .
Estreum Logistics (Pty ) Ltd is our business entity in Elim deep rural Vhembe With reference to the above we have made significant progress with the visualisation , research , conceptualisation and development with CSV support.
We are currently busy with the planning and development of the prototype modular SparZa store. Our personal investment to date is almost R5 million.
The premises and deep rural Fleet in Elim bought from Pioneer Foods will serve as the deep rural SparZa distribution, training and support centre .
In future the same concept can be replicated elsewhere..
Currently we envisage the following:
? Finalising the first SparZa prototype to Turnkey and TradeReady stage at Elim using an innovative configuration and design using shipping containers.
? Similar to USave strategy this will be useful where title deeds and development of brick and mortar stores will most likely prevent rapid future roll out.
? Installing the pilot store.
? Provide sufficient training in one of our Vhembe based stores for the future owner and staff.
? Assist with the launch and opening of the store
? Operationally supports the store on a day to day basis. In essence doing for SparZa in deep rural what SPAR is doing for SPAR members with the support of SPAR.
? Use the design and layout of the Prototype SparZa modular store as a template for building the following Sparza TradeReady modular stores at rural Elim. Labour will be sourced from local rural people in Elim.
? I have relevant experience as a qualified teacher and Checkers store manager with training. When at Checkers I was tasked to re write the training Manual for Checkers trainee managers.
? Training of management in respect of the various different FMCG retailers are different from one another. Whilst the typical FMCG retail training presented at SVET colleges may improve the opportunity for employment every retailer i.e Shoprite , SPAR , Game , Makro ,PnP etc. for valid reasons will expect of every supervisory and management employee be retrained according to the specific group's unique in-house systems.

SPAR South Africa has already approved the CSV initiative associated with our vision.
? Kevin O Brien who is in charge of the development of the sustainability plan for SPAR South Africa has indicated to me that when he was in Europe at Oxford busy with other captains of industry with the development of corporate sustainability already some time ago he also had discussions with the executive of SPAR globally in Amsterdam where SPAR originated
? According to Kevin they have indicated that if the South African government support the CSV concept they will consider the contribution of several million euro to such a initiative .
This will not be different in respect of future SparZa employees and owners. I will personally complete the training manuals , practical's and evaluation. Especially the low cost retail model will require specific and dedicated training by future owners and managers .
Going forward we will appreciate the interest , contribution and involvement of Government in a coordinated manner , other appropriate stakeholders especially with the next phase involving the Pilot Store.

Currently I have a wealth of PowerPoint based visuals to explain the above.
The FMCG retail ( a one trillion industry ! ) challenge with government according to me is that a project of this magnitude requires a common and APPROPRIATE vision . My experience is that although there are many platforms intended for SME support operate independently in a fragmented manner with little insight in the actual support requirements associated with FMCG retail.
In deep rural Vhembe FOREIGN WHOLESALERS has managed to establish MANY sustainable FMCG retailers whilst collectively the Dti , Seda , Sefa , Lema , Small Business Development Corporation , LEDA etc. has managed to establish none that I am convinced of.

It may not represent empirical research but at our security business a debtors list of deep rural clients with alarm systems will reveal MANY stores owned by foreign retailers across many deep rural villages but an effort to extract a similar list of retail stores owned by local people there are NONE.