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Digital procurement platform Kuba expands to other provinces

Kgaogelo Letsebe
By Kgaogelo Letsebe, Portals journalist
Johannesburg, 04 Apr 2018
Kuba - a digital procurement platform - has managed to connect over 100 SMEs to corporate companies for recurring business deals.
Kuba - a digital procurement platform - has managed to connect over 100 SMEs to corporate companies for recurring business deals.

Western Cape-based business-to-business procurement platform Kuba has to date signed on more than 100 small businesses to provide services to at least 25 corporate companies as well as trading with fellow SMEs.

Launched in October 2017, Kuba is a free-of-charge digital platform that aims to better facilitate business-to-business procurement needs in the province. The platform encapsulates the whole transaction to ensure that high standard of services are delivered and transparency is maintained.

At present it has 12 different categories in which vendors can provide services such as promotional material to welding and electricians. When it started, the platform had 68 small business as vendors and 18 corporate clients which eventually resulted in 23 jobs being created.

Nearly six months later, the platform has now signed up over 100 small businesses and has been able to successfully facilitate business for more than 65% of its vendors.

"On average the SMEs on Kuba are invoicing over R300 000 per month. We currently have 108 active vendors signed up to the platform, who are all registered businesses. At the beginning the most of the opportunities were once off, but we now have companies who have built relationships and continue to do so with our vendors into repeat businesses. We have also introduced Kuba value-added services that allows the small businesses to quote and invoice their day-to-day clients and this has helped us to keep registered vendors to use the platform regularly," explains founder Jacques Sibomana.

Sibomana adds that a minority of the vendors on the platform (35%) did not have fully registered businesses and therefore did not qualify. "But we have introduced workshops called Kuba Friday last day of every month where we will be providing training and educating our vendors on how registering on the platform can be Companies and Intellectual Property Commission (CPIC) registered, as well as have all necessary industry certificates. We will also focus on business administration and marketing by bringing various experts from different industries to share knowledge of how to become an ideal vendor."

SMEs have largely been identified as productive drivers of inclusive economic growth and development in the country as well as globally. Research from Stats SA shows that small and medium-sized enterprises make up 91% of formalised businesses. The latest Business Partners Limited SME Index also indicates that SMEs are confident that the South African economy will be conducive for business growth in the next 12 months. According to the survey - which measures the attitudes and confidence levels of SME owners in SA - confidence levels have risen to 78%.

With regards to being financially viable, Sibomana says the platform has two streams of income - a licencing model and a pay-as-you-use model. "Corporate companies that plan to use Kuba regularly can opt to licence the platform, this will give the firm unlimited use of the platform within the specific region they have licenced, as well as up-to five users. For the pay-as-you-use clients, we charge a sliding commission on invoice. Fees range from R45 000 per annum for coverage in a municipality to R11 000 per month for provincial access.

"We are still building our network in KwaZulu-Natal and Gauteng with a potential training partner. Once this has been finalised, we will have better idea of possible timelines for the expansion. We are also busy building a database of vetted and qualified vendors in these provinces. I do however need to note that being an online platform allows us much flexibility with regards to expanding."

This week, the platform will be hosting an afternoon interaction session that will see vendors and corporate interact to learn from each other and aid close the existing gap even further. "The session will be at the UCT Graduate School of Business from 3pm inside the MTN solution space incubation. We do believe that these talks will strengthen the relationship between corporate South Africa and SMEs."

MTN, University of Cape Town Graduate School of Business as well as Stellenbosch Innovation District and SUSTNET are partners and advisors of Kuba.

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