Spaza shop business plan

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Spaza shop business plan

Comments A recent study of township informal trade suggests that in the past few years an entrepreneurial revolution of sorts has revived the spaza shop, to the extent that the demise of the owner-managed township house shop, under the onslaught of the retail giants, Shoprite and Pick n Pay, suddenly looks less certain now.

Gone is the grimy counter that once separated the dour shop assistant from the customers lest they shoplift. Spaza shops have doubled in size and have become self-service superettes.

The range of product s has increased, so consumers no longer have to travel 10km to buy goods such as gas, cosmetics, hardware or spices. Spaza shops have become sensitive to local customer needs. For example, they now sell sugar by the spoonful instead of the usual g packet that becomes too expensive for many pension-dependent households towards the end of the month.

And there are no more empty shelves. Spaza shops stay stocked no matter what the time of week or month. Whereas they used to employ on average two people, they now employ three. Above all else, they have become cheaper. Poor families can now pay close-to-supermarket prices without having to fork out a R30 taxi fare.

How curious then that this progress is being widely perceived as an evil instead of being celebrated as a vast improvement to an essential community spaza shop business plan.

Good business revives spaza shops | News | M&G

It is being driven by Somalis. Or perhaps not so curious. The hatred aroused by the arrival of an outsider who innovates and improves and thereby threatens entrenched interests is as old as trade itself. One of the earliest community-wide outbreaks of xenophobic violence was a direct result of a coordinated call in from local shopowners in Masiphumelele, a small informal settlement near Noordhoek in Cape Town.

But some observers think that the influence of local shopowners in the latest wave of xenophobia has waned. This time it has more to do with unemployed youth, angry about the perceived low-cost labour of Malawians and Zimbabweans, who include Somali traders in the broad sweep of their fury—they discriminate against foreigners, not between them.

They now mostly run shebeens, a trade eschewed by the Muslim Somalis, or rent out their shops to foreigners.


A study commissioned by Mohamed after the xenophobic violence in shows just how ill-prepared local spaza shopowners were for the influx of Somali traders. The researchers compared the business practices of local spaza shopowners with those of foreign traders in Khayelitsha.

Local spaza shopowners started their businesses with an average of R compared with the R15 by foreigners. Local-owned shops occupied between 30m2 and 40m2; those of Somalis occupied between 40m2 and 90m2.

Somali shopowners tap into their own sophisticated collaborative distribution networks and pass on bulk discounts and transport savings to customers.

spaza shop business plan

There is nothing inherent about the success of any ethnic group, says Landau. It is just that the Somali community in South Africa has a high proportion of entrepreneurial business people. Immigrants everywhere are by definition movers. Being hard-working and risk-taking are two of the important characteristics of a good entrepreneur.

Some of them put that to use in the regular labour market, working for someone else, and in many instances they put that to work starting their own businesses. In response to one of the main recommendations of the researchers who studied the Khayelitsha spaza shops, Cape Town decided to train local spaza shopowners to become better shopkeepers.

The attempt followed the same trajectory as almost every training programme aimed at improving the business practices of informal traders in the past two decades in South Africa—the government identifies the need to turn informal business people into formal ones, designs a training course on costing, pricing, bookkeeping and planning, pilots it once and then scraps it because of the embarrassingly low uptake and success rates.

Landau points out that not all the factors that contribute to the success of Somali shopkeepers have to do with skills. South Africa [on the other hand] has fragmented and distrustful communities. When questioned about it, he ascribes the support as coming from the Muslim community internationally and locally.

What makes it unfair, he says, is that local shopowners have no similar support from the government. Abdullaahi Hussein Mohamed, a shopowner in Masiphumelele who came to South Africa inrejects the stereotype of Somali shopowners as shrewd opportunity seekers.Related: Coffee Shop Business Plan The intention is to provide customers with access to exclusive travel destinations, service to fully appreciate destinations through information packages, not just sight-seeing, and access to special interest travel according to the group’s/individual’s preferences.

The township spaza shop competition is tough, and the subject of foreign-owned spazas is a thorny one for many local spaza shop owners. A Cape Town based non-profit organisation, the Sustainable Livelihoods Foundation (SLF), conducted a two-year in-depth study to understand the current characteristics of ownership, the scope of employment within the business and trading practices of .

For most people, opening a spaza shop is a small business venture to earn an income. For Richard Handel, it is just to keep busy. SPAZA SHOPS IN THE TOWNSHIPS WHAT IS A SPAZA?

part 1: A spaza shop is an informal convenience shop. The name spaza derives from township slang meaning an ‘imitation’ Small family run, spaza business The typical shop keeper is % male and 42 years old and been in.

MillenniumMart convenience store business plan executive summary. MillenniumMart will be the first fully automated, hour convenience store that is more like an enormous dispensing machine than a . Research into the business dynamics of both local and foreign spaza shop owners revealed that the defining factors behind the foreign spaza shop owners’ success were: Access to cheap labour (family members often work in the shop for very little remuneration);.

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