Designing a transformative business for Alex.
It is clear that the millions allocated for the development of Alexandra Township, Johannesburg has not been well spent. We have been asked to propose a plan using the Sunstyle approach. We decided to implement the Business Gym as the operating system. We were told that 300 trainees were undergoing training; 100 in welding, 100 in catering and 100 in sewing.
This has led us to develop a set of assumptions based upon our experience in thsi field:
This list of assumptions underpin the models and proposal for the creation of business units in the Alexandria Development Project.
The Trainees
The three sets of trainees will not all pass their training course. There will be an average 15% drop-out rate over the training period. Thus the 100 welders will only be about 85 welders, the 100 caterers will only be about 85 caterers and the 100 seamstresses will only be 85 ready to set-up business. This means that only 255 individuals will complete the training in the three fields of Sewing, welding and catering.
The graduates will generally not have prior experience of running their own business. This means that few will know about business processes or systems.
The graduates will be technically minded and not have the aptitude for sales, marketing, communications or human relations. His means that these graduates will need support in such fields.
The graduates will be largely township youth and thus not have access or skills in negotiating business deals and relating to the formal market economy.
Most of the graduates will have very little personal capital or access to family members with capital to invest in business ideas.
Most of the graduates will have family ties to others living outside of Alexandria township, mostly in rural areas or non-formal peri-urban settlements.
Business opportunities
The business opportunities will involve the creation of an estimated 116 business units working as interdependent profit centres using the Business Gym as its operating system.
The welders will generally be able to work individually within the non-formal sector and may come together on a project basis to do large orders such as window frames for RDP developers. Large LP Gas suppliers such as Afrox may be interested in supplying gas at good rates to the welders and the welders may be able to secure a contract to manufacture gas cookers. There is also a market for the construction and sale of VESTO’s, an energy-saving wood burning stove and heater. An estimated 85 welding profit centres will be created.
The Sewing graduates will work best in profit centres of 15 to 20 individuals. They will be able to sew school uniforms for sale locally with the support of local schools, they will be able to sew bedding and curtains using favourable rates and terms offered from participating suppliers. There is also a market for Hotbags, an energy-saving cooking device known as a retained heat cooker. An estimated 6 sewing profit centres will be created.
The caterers will be best organized into profit centres of around 3 to 5 individuals. These profit centres will run small take-aways licenced under the African Burger system and based in local spaza shops to create a cash-flow stream and will offer catering for a variety of functions. The caterers will use hotbags and Vesto’s as well as LP gas to prepare food and act as demo-units for these energy-saving products. And estimated 25 profit centres will be created.
The skills-set required to run a successful business operation will be provided by Instant Muscle, a Sunstyle company run as a joint venture between various stakeholders.
The skills-set that Instant Muscle brings to this project includes:
Financial management
i. Debtors
ii. Creditors
iii. Bookkeeping & Auditing
iv. Insurance and risk management
v. Equity
vi. Planning and management accounting
Administration
i. Buying
ii. Stock control & storage
iii. Vehicle and Property Maintenance
iv. Filing and correspondence
v. Minute-taking and record-keeping
vi. Meetings and conferencing
vii. Formal compliance & registrations
viii. Copyright, licensing and legal services
Leadership & mentoring
i. Planning
ii. Mentoring leaders
iii. Evaluating outcomes
iv. Strategy
Creativity
i. Product development
ii. Service development
iii. Branding support
Sales management
i. Sales team management
Marketing
i. Branding
ii. Supply chain negotiations
Public Relations
i. Website
ii. Print media
iii. Other media
iv. Below the line marketing
Group communication
i. Quality circles
ii. Cross functional teamwork
Ethics
i. Ethics reviews
ii. Ethical consultations
iii. Environmental Impact surveys
Human Resource Management
i. Training
ii. Creation of job specifications
iii. Hiring and firing
iv. BEE compliance
Instant Muscle will operate as a Cost Centre in the group of companies and Co-operatives and will levy 12.5% of revenues generated to meet the costs of supplying these services.
The group will aim to become profitable and therefore self-sustaining within 36 months from start-up.
Instant Muscle will retain a proportion of its levy in a Community Trust for the further development of Alexandria including environmental and social development projects.
Financing will be designed to maximize the profit and income of each profit centre. To this end the Community Trust will be used to channel financing to each profit centre in the start-up phase. Each profit centre will then pay Instant Muscle its levy out of such financing.
We have now begun the process of working-out the business case for each type of profit centre and will finsih with the business plan for Instant Muscle.
This has led us to develop a set of assumptions based upon our experience in thsi field:
This list of assumptions underpin the models and proposal for the creation of business units in the Alexandria Development Project.
The Trainees
The three sets of trainees will not all pass their training course. There will be an average 15% drop-out rate over the training period. Thus the 100 welders will only be about 85 welders, the 100 caterers will only be about 85 caterers and the 100 seamstresses will only be 85 ready to set-up business. This means that only 255 individuals will complete the training in the three fields of Sewing, welding and catering.
The graduates will generally not have prior experience of running their own business. This means that few will know about business processes or systems.
The graduates will be technically minded and not have the aptitude for sales, marketing, communications or human relations. His means that these graduates will need support in such fields.
The graduates will be largely township youth and thus not have access or skills in negotiating business deals and relating to the formal market economy.
Most of the graduates will have very little personal capital or access to family members with capital to invest in business ideas.
Most of the graduates will have family ties to others living outside of Alexandria township, mostly in rural areas or non-formal peri-urban settlements.
Business opportunities
The business opportunities will involve the creation of an estimated 116 business units working as interdependent profit centres using the Business Gym as its operating system.
The welders will generally be able to work individually within the non-formal sector and may come together on a project basis to do large orders such as window frames for RDP developers. Large LP Gas suppliers such as Afrox may be interested in supplying gas at good rates to the welders and the welders may be able to secure a contract to manufacture gas cookers. There is also a market for the construction and sale of VESTO’s, an energy-saving wood burning stove and heater. An estimated 85 welding profit centres will be created.
The Sewing graduates will work best in profit centres of 15 to 20 individuals. They will be able to sew school uniforms for sale locally with the support of local schools, they will be able to sew bedding and curtains using favourable rates and terms offered from participating suppliers. There is also a market for Hotbags, an energy-saving cooking device known as a retained heat cooker. An estimated 6 sewing profit centres will be created.
The caterers will be best organized into profit centres of around 3 to 5 individuals. These profit centres will run small take-aways licenced under the African Burger system and based in local spaza shops to create a cash-flow stream and will offer catering for a variety of functions. The caterers will use hotbags and Vesto’s as well as LP gas to prepare food and act as demo-units for these energy-saving products. And estimated 25 profit centres will be created.
The skills-set required to run a successful business operation will be provided by Instant Muscle, a Sunstyle company run as a joint venture between various stakeholders.
The skills-set that Instant Muscle brings to this project includes:
Financial management
i. Debtors
ii. Creditors
iii. Bookkeeping & Auditing
iv. Insurance and risk management
v. Equity
vi. Planning and management accounting
Administration
i. Buying
ii. Stock control & storage
iii. Vehicle and Property Maintenance
iv. Filing and correspondence
v. Minute-taking and record-keeping
vi. Meetings and conferencing
vii. Formal compliance & registrations
viii. Copyright, licensing and legal services
Leadership & mentoring
i. Planning
ii. Mentoring leaders
iii. Evaluating outcomes
iv. Strategy
Creativity
i. Product development
ii. Service development
iii. Branding support
Sales management
i. Sales team management
Marketing
i. Branding
ii. Supply chain negotiations
Public Relations
i. Website
ii. Print media
iii. Other media
iv. Below the line marketing
Group communication
i. Quality circles
ii. Cross functional teamwork
Ethics
i. Ethics reviews
ii. Ethical consultations
iii. Environmental Impact surveys
Human Resource Management
i. Training
ii. Creation of job specifications
iii. Hiring and firing
iv. BEE compliance
Instant Muscle will operate as a Cost Centre in the group of companies and Co-operatives and will levy 12.5% of revenues generated to meet the costs of supplying these services.
The group will aim to become profitable and therefore self-sustaining within 36 months from start-up.
Instant Muscle will retain a proportion of its levy in a Community Trust for the further development of Alexandria including environmental and social development projects.
Financing will be designed to maximize the profit and income of each profit centre. To this end the Community Trust will be used to channel financing to each profit centre in the start-up phase. Each profit centre will then pay Instant Muscle its levy out of such financing.
We have now begun the process of working-out the business case for each type of profit centre and will finsih with the business plan for Instant Muscle.
posted by Dug at
6:29 pm
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