Spar Embraces Transformation

As part of SPAR's commitment to transformation and job creation, they will be joining forces with the National Treasury and its Jobs Fund initiative to fast track black enterprise development amongst its brands. This initiative will be facilitated by SA Franchise Warehouse as service provider and Business Partners Limited as the commercial funding partner.

THROUGH THIS INITIATIVE, funding will be made available to suitable BEE candidates on a quasi-equity structure, essentially enhancing the franchisee’s own cash contributions so that commercial funding can be procured at a reasonable level of gearing. SPAR, in turn, would provide comfort to the funders by ensuring that the funded enterprises remain sustainable and that jobs are being preserved.

Says SPAR National Property Development Manager, Craig Coetzee, “Allowing previously disadvantaged franchisees to borrow 80 or 90 percent from Development Funding Institutions with the standard 60-month repayment terms, even at prime interest rates, is not a sustainable funding solution and allowing such would not be in the best interest of the franchisee or our brand. However, with the Jobs Fund initiative’s longer repayment periods and the fact that the Jobs Fund component of lending is interest free (as if owner’s equity), installments will be in line with the level of debt our business model can actually support.”

SPAR believes that this funding structure will also enable emerging entrepreneurs to access their lower set-up cost brands such as Build It, Savemor and PHARMACY@SPAR.