BP Southern Africa has announced a partnership with the Small Enterprise Finance Agency (Sefa) to support black-owned businesses. The company will provide a total funding of R58m to help SMEs acquire and operate service stations and forecourt retail businesses at BP service stations. The funding includes an initial investment of R18m and an additional R40m that Sefa will receive from annual loan recoveries. Sefa will finance 50% of the capital needed by approved businesses, while BP and Sefa will jointly approve the beneficiary businesses.
Taelo Mojapelo, CEO of BP Southern Africa, emphasized the importance of building strong partnerships to achieve their business objectives and transformation journey. As part of their retail transformation agenda, BP aims to have 70% of their service stations operated by black dealers by 2025. Currently, BP has over 500 branded retail stations throughout the country, with plans for further growth in the coming year.
The partnership between BP and Sefa is set to run for five years, with the possibility of renewal. BP will contribute to the fund annually to ensure its growth and future impact. Mojapelo highlighted the significance of service station forecourts as retail hubs that provide services to communities and motorists. BP aims to redefine convenience in key markets and meet customers’ needs.
The global forecourt retail market was valued at over $190bn in 2019, with a predicted compound annual growth rate of 3.6%, particularly in emerging markets. In South Africa alone, the forecourt retail business is estimated to be worth R40bn annually, presenting opportunities for emerging dealers.
Mxolisi Matshamba, CEO of Sefa, expressed enthusiasm for helping black-owned businesses enter the sector and create sustainable enterprises that offer employment opportunities. Access to capital is a significant barrier for building a thriving entrepreneurial business community, and this partnership aims to open up the energy sector to more black players.
The oil industry in South Africa plays a crucial role in the country’s economy, accounting for 3.2% of the Gross Domestic Product and creating 250,000 jobs. The government recognizes the strategic importance of the sector and has introduced legislation, policy mandates, and regulations to stimulate growth, economic transformation, and access to resources for women, youth, and persons with disabilities.
Interested parties can apply for funding through Sefa, which will manage the loan process and provide support and oversight to successful retailers. This public-private partnership aims to promote and advance transformation in the industry by addressing challenges such as access to finance, markets, skills, and non-financial support.