Helping Rural Blind Build a Business

NEED

There are over 724,000 visually impaired people in South Africa. Due to historical inequalities, many of these people did not receive adequate schooling or training. The rural settlements of Groenwater in the Northern Cape and Qwa-Qwa in the Free State, where these projects will take place, are characterised by high levels of poverty and low levels of education. This lack of education means that blindness carries with it a stigma, and blind people living here often face discrimination and marginalisation.

One of the biggest problems faced by the community as a whole, and blind people in particular, is poverty. More than 40% of the total population lives on less than R5057 a year. Throughout the country, the rate of employment for blind South Africans is less than five percent, and it is no different in these communities.

OVERVIEW

The 14 members of the Kgatelopele Blind Association in Groenwater and the 29 members of the Reikamohetse Blind Association in Qwa-Qwa have identified the need for locally made, affordable household detergent products in their communities. By establishing cooperatives to manufacture these detergents, they believe they can meet this demand and create a sustainable source of income for themselves.

Both associations include members who have basic financial management skills as well as experience in the manufacturing and selling of detergents. In establishing their businesses, the two associations will continue to receive support from the South African National Council for the Blind. The Council is experienced in assisting blind associations with setting up similar businesses. These businesses have mostly been successful at creating a sustainable source of income for its members.

Through its SASIX listing, the Council will provide the necessary start-up capital for these micro-enterprises, which will provide a sustainable source of income for the 43 members of these associations.

WHAT WE LIKE ABOUT THIS PROJECT

• The support of the Council means that the blind associations have access to outreach and support whenever they need it.
• The associations have put together well-researched business plans.
• By giving members ownership of their own micro-enterprise, the project not only provides a sustainable source of income its member-owners, but will also be a boost to self-esteem.

IMPACT HIGHLIGHTS

On average, the Council has found that similar businesses can pay about R600 per month to each member. This will provide the 43 beneficiaries of this project with a valuable income to supplement their disability grants. This will help association members become more independent, and feel like less of a burden on their loved ones. This will have an invaluable effect on their self-esteem. Finally, the project will provide these largely poor, rural communities with locally made and affordable detergents.

ORGANISATIONAL CAPACITY

The SANCB is a well established national organisation, which incorporates 92 member organisations throughout the country. The purpose of the SANCB is to empower people with visual impairments towards independence. This is widely documented and understood within the organisation.

The governance structures of the SANCB are deeply democratic, with individuals from their member organisations nominating and voting for leaders who represent them on the National Executive Committee (NEC), which acts as the organisation’s board.

The SANCB is affiliated to a number of national, regional and international organisations, through which it is able to access research and review its own programmes to align with best practice. Beneficiaries of the SANCB have access to various decision-making bodies, which allow it to be responsive to particular needs and issues that are raised by their beneficiaries.

The SANCB has many sources of income, and relies heavily on individual donations. It has a formal, documented fundraising strategy in place to meet its future needs.

RISK PROFILE

Key Strengths

• Concept: The project seeks to provide a sustainable source of income that will make the members of the two blind associations more independent.
• Design: The members of the association themselves will own their own businesses. This will help to ensure their buy-in and be a boost to their self-esteem.
• Capability: The Council has previous experience in setting up similar businesses.
• Sustainability: Research has established the demand for their products and a detailed business plan will guide their strategy to maintain a sustainable source of income.

Key Risks - Low

• Control: The blind associations will take full ownership of their businesses. While the Council will provide support when it is required, these associations will ultimately be responsible for their own success or failure.
• Capability: Members who will be running the micro-enterprises have limited business experience. This is somewhat mitigated by the training and support that is provided by the Council.
• External: As with any new business, there are risks that the cost of production might increase (for example, the cost of any of the chemicals used to manufacture detergents might suddenly increase). Working in an impoverished area also means that demand for can fluctuate, though the demand for detergents, which are not luxury items, should remain fairly consistent.

Project Profile ED-NC-MAR10-0001

Organisation: South African National Council for the Blind

Sector: Small Business Development

Project Duration: 12 months

Project Budget: ZAR 60 250

Shares Issued: 1205

Shares Available: 0

Risk Assessment (0 to 5)

Concept: 1

Design: 1

Capability: 0.5

Control: 1.3

Sustainability: 0.5

External: 1

Organisation Rating (0 to 5)

Purpose: 4

Planning: 4

Performance: 0

Resources: 4

Governance: 4

Sustainability: 3

Project Budget

Project Sector

Small Business Development

With South Africa's unemployment rate as high as 40 percent in terms of a broad definition, the accelerated creation of sustainable small and micro enterprises is essential both to economic growth and to future socio-political stability. Township and rural-based enterprises, in particular, have the potential to create jobs and alleviate poverty by channelling resources into disadvantaged communities.

Research shows that our country has a low rate of entrepreneurial activity compared with other developing countries, with entrepreneurs contributing only 35% of GDP, compared with 60% in countries like India and Brazil. In addition, only 80% of all new SA businesses survive past the first two years - a low rate when compared with other developing countries. According to the annual Global Entrepreneurship Monitor study, the key factor influencing entrepreneurial activity in South Africa is the lack of effective education and training in entrepreneurial skills and basic financial literacy.

The large majority of new small businesses are operated out of necessity - people eeking out a living through informal trading and service provision because there is no alternative. These necessity entrepreneurs frequently have little or no access to computers, telephones, transport, banks and government services, and lack the financial literacy and business administration skills to sustain and expand their businesses.

Opportunities exist to invest in educating informal traders and community members in business administration and financial literacy, and in supporting the expansion of entrepreneurship education in schools and colleges. There is a need to invest in the extension of services that advise and support start-up businesses to previously marginalised areas, and to support initiatives to create community investment trusts and co-operatives that undertake productive activity. There are also exciting opportunities to help dynamic entrepreneurs in poor communities to purchase new equipment or set up business premises, creating employment in their communities.

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SASIX Evaluation Metrics

The organisational rating

In partnership, Trialogue and The Funding Site developed an expert organisational capacity diagnostic test, which has been further refined by GreaterGood South Africa based on its consultations with Geneva Global and others active in this area. The result is a comprehensive evaluation and verification tool that GreaterGood South Africa uses to assess the capacity of non profit organisations according to both qualitative and quantitative metrics. The tool encompasses the purpose, strategy, performance, resources, governance and sustainability of the organisation and its activities. GreaterGood South Africa project managers are employed in the field to conduct the evaluations with the organisations implementing SASIX projects. The results of their findings are assessed through a peer review process, and then coalesced into the organisational ratings presented on the front page of each SASIX Project Profile.

The project risk assessment

In consultation with Geneva Global, GreaterGood South Africa uses a comprehensive risk assessment tool to evaluate target projects - a tool that encompasses the project's concept, design, capability, control, sustainability and external factors that will or may affect the successful implementation of the project. At the completion of the project, GreaterGood South Africa will issue a Project Performance Report that compares the actual life change with the expected life change forecasted on the front page of this profile. This report will also include the key lessons learned.

GreaterGood South Africa Services

Project identification - Through wide, expert consultation and screening processes, GreaterGood South Africa identifies top South African non profit programmes that address the greatest development needs in the country.

Site visits - In order to become a recommended SASIX project, GreaterGood South Africa's project managers must have seen the project first-hand and undertaken the necessary evaluation interviews with the project's implementer(s).

Desk research - International best practices and other references are used as benchmarks to measure the projects.

Peer review - Information gathered and project profiles are assessed through a peer review process.

Deal structure - GreaterGood South Africa's project managers work closely with the project implementers to establish the parameters with regard to the expected results, time-frames, monitoring processes, use of funds, budget and final evaluation.

When you invest in a SASIX project, GreaterGood SA will:

Document the agreement - Before funding is supplied to a project, GreaterGood South Africa concludes a Memorandum of Agreement with the organisation which covers expected results, timelines, reporting frameworks and acceptable uses of funds.

Assist with funds transfers - GreaterGood South Africa will assist with the necessary transfers of funds, according to the funder's requirements.

Obtain receipt of funds - GreaterGood South Africa confirms when the funds arrive with the project implementer.

Check progress - At around 3 months, GreaterGood South Africa confirms that the project is proceeding according to plan. The project managers are available to project implementers for advice and consultation on an ongoing basis.

Measure results - After the conclusion of the project, GreaterGood South Africa collects the necessary data and compiles a Project Performance Report which includes an analysis of the outcomes and the lessons learned. Each funder of every SASIX project receives the report.

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To fund this project

Please contact: SASIX
Tel + 27 21 794 0580
Fax: 27 21 794 2239
Email: sasix@ggsa.co.za

Postal address: Postnet Suite 293, Private Bag X16, Constantia 7848, South Africa