By Amanda Killick
Bessie Mogale dreams of turning her spaza shop, or tuckshop, located in a South African township, into a supermarket chain by 2020.
Mogale didn’t let poverty or negative circumstances get her down. She runs the shop from her home in one of Rustenburg’s informal townships.
She’s not alone. According to a recent survey, 94 percent of African female business owners work in the “informal” sector.
There are an estimated 40,000 spaza shops in South Africa’s Gauteng province alone – 100,000 across South Africa – generating a turnover of $7 million a year. Each spaza employs on average two to three people, each supporting a family of four.
Mogale was chosen by Coca-Cola to participate in its 5by20 Women Empowerment course. The course addresses common barriers women face around the world when trying to succeed in the marketplace. It provides business skills training courses, financial services, peers or mentors and builds confidence, according to coca-colacompany.com.
How did you start your business? I have always been an entrepreneur – it all started with a bag of oranges. I sold each orange at a profit and, when my mother found out, she told me to use the money to replace the bag. I then used the change to buy sweets to sell to all my school friends, much to her dismay. It was then that she told me that I take after my grandmother who had owned a butchery, a grocery store and other shops. Before starting the tuck shop, I was unemployed and when my husband left to work in Botswana, I had to raise three boys by myself. As an unemployed mother, this was going to be quite a challenge. Opening the tuck shop was the only way I could make sure that we had food on the table and that the boys received a good education.
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What kind of planning went into starting your shop? In my case it was all about having the passion and determination to create a sustainable business. I didn’t have a business plan; instead I used the knowledge and skills I picked up over the years. However, after attending Coca-Cola’s Women Empowerment training course, I realized how important it is to have the correct skills and structures to run a successful business. Without these, your business has a higher risk of failing along the way.
How did you set the business up? I started my little tuck shop in a one-room shack made out of corrugated iron and mud-pack walls. I had enough money to buy one crate of cold drinks, a few bags of (corn) meal, sugar and tea. It was a difficult time, but I was determined to do better and make my venture a success. I knew that I needed more skills and money to grow the business, so when the opportunity to gain such knowledge presented itself through the training course, I did not hesitate to attend. Not only did I gain financial and human resources, as well as business management skills from the training course, but I also received $300 start-up money and an old shipping container to use as my tuck shop.
What’s your big dream for this venture? At the moment, I run one tuck shop, which I would like to see grow into a supermarket to franchise across the country.
What’s it like doing business in your market sector? I have found that it pays to conduct ongoing market research to stay competitive. When I started my tuck shop, I asked my customers what new products they would like to see in the shop, which I then went ahead and purchased. I’ve done this ever since and it’s working well. I’ve also learned to be careful about who you employ. When I started my tuck shop, I employed an additional worker. We worked well for some time until it came to my attention that he was stealing from the tuck shop. The only way I could solve the problem was to let him go.
What mistakes have you learnted from? Firstly, being product-driven instead of focusing on the customer. Upcoming entrepreneurs need to keep in mind that in order to succeed they need to provide a need or want to their customers, and no matter how wonderful your offering is, if it does not satisfy a customer’s needs it will not be bought. Secondly, new entrepreneurs tend to spend more money than they will make, which may lead to early financial problems.
How do you stay motivated? I was raised by independent businesswomen; my mother and grandmother. Watching them work hard and strive for the growth of their businesses remains an inspiration and motivation for me in my quest to grow my business. I looked up to my grandmother; her tenacity helped sustain her businesses and our family. I believe that every up-and-coming entrepreneur should have a mentor who will advise and assist them as they grow their ventures.
Is it ever alright to give up on a dream? No, dreams are meant to be followed. Dreams are the things that challenge us to do better and grow as people, if we were to stop following our dreams, we would stop growing as individuals.
What’s your life motto? “When life gives you lemons, make lemonade!” In my case: “When life gives you oranges, start a business!”
So what five tips can you give for doing business in the African way?
Always conduct market research ahead of starting your business.
Beware of who you partner with and protect yourself and your business within the law.
Always know where you want to be in the future and have a clear vision of your future plans.
Never give up on your hopes and dreams.
Equip yourself with the relevant skills needed to run your business.