The vision of the Eastern Cape government to create sustainable rural economies is becoming a reality, with the Mqanduli Rural Economic Development (RED) Hub securing a contract to supply mielie meal to Spar outlets from Port Elizabeth to Kokstad.
Chairman Sithembele Zibi said the hub – made up of 11 co-operatives with over 988 members – started supplying mielie meal to Spar Nicks Food in King William’s Town a few years ago. He explained that the extension of the contract to more Spar franchises is the break they have been waiting for.
“This adds great value to our business because we now have a steady, big customer. It’s radically different from relying on walk-ins and the occasional orders because they [the Spars] expect a steady supply. The more we produce, the more we earn and the more we can increase productive capacity,” said Zibi.
He said the Spar contract would double the hub’s distribution and increase its workforce, initially on a temporary basis. “We might have to start a night shift at the milling plant to meet orders,” said Zibi.
He added that the co-operative currently has 42 employees, including eight tractor drivers, admin staff, millers and truck drivers.
Zibi said the Eastern Cape Rural Development Agency (ECRDA) has opened many doors for them and has helped them in all aspects of their business operations, including funding and hygiene standards.
He mentioned how a trade mission to Kenya, facilitated by ECRDA, allowed them to see successful co-operatives in action and then apply the knowledge learnt on return home.
ECDRA agro-processing manager Luvo Qongqo roped in First Business SA to assist the hub in penetrating the retail sector – which resulted in the eight-year Spar contract.
“In first two years, Spars normally require a rebate but they waived that in this case. They will also assist in promoting the product in their pamphlets.
“We also brought in Kennedy Mavatha, a contract mill manager who oversees milling operations,” said Qongqo, adding that 24 tons have already been delivered to 24 Spar outlets in Ugies, Ngcobo, Alice, Lady Frere and Cala, among other towns.