Tag Archive: BEE 123


Softline Pastel, South Africa’s leading developer of business and accounting software, today launched a portal for its range of online applications. The platform, known as Sage Pastel Online, provides the entrepreneur on-the-go one central location to access the company’s bouquet of cloud-based business tools, making running a small business a little easier.

Pastel Accounting launched South Africa’s first online accounting program, My Business Online, in May 2009 and since then has brought several online innovations to the local SME market.

“Times have changed,” says Steven Cohen, managing director of Pastel Accounting. “We have entered an age where technology is pervasive, allowing us more mobility than ever – and business has to be part of the revolution to remain competitive.”

The portal can be found at www.sagepastelonline.com and offers online accounting, payroll and marketing services – allowing business owners the freedom to run their businesses at any time from anywhere. Additionally, Pastel’s BEE one-stop-information-hub, BEE123 and brand new free-to-all-users personal finance applications are also available in the same location.

Pastel My Business Online is a full-function accounting program, designed specifically for the small business owner. All accounting lingo has been changed to simple English, so even the layman can manage the business’s books. It’s a multi-user system with dashboards, graphs and drill-downs to source transactions that provide a bird’s eye view of the business. The system allows users to manage customers, suppliers and inventory items and keeps track of sales and purchases. It comes with a comprehensive list of reports so that month-end management packs are quick and easy to create.

Pastel My Payroll Online is a simple payroll solution that allows SME owners to pay their employees anywhere, anytime.  It’s a SARS compliant system aligned to even the most complex legislation, including PAYE and UIF. Users can also process leave online with leave types already defined according to the BCEA requirements. Like, My Business, My Payroll contains no confusing jargon.

Did you know 70% of SMEs don’t have a website, or at least one with limited marketing capabilities or integration with smartphones and social media. Pastel My Webspace is an online marketing engine for SMEs with an HTML5 website builder designed for optimal marketing and e-commerce capabilities. In addition My Brand will manage users’ search engine optimisation, and mobile and social media integration. My Brand effectively integrates everything for the user and provides an all-in-one e-marketing service with analytics, social media insights, and creating and mailing a fully dynamic newsletter with marketing feedback.

“Moving your business applications online is a must for anyone who wants to ensure that they remain at the cutting edge of service delivery,” said Cohen at the launch event that celebrated the mobile business of the future.

As part of Pastel’s drive for business mobility, it has also formed a relationship with Samsung Enterprise Mobility. Selected Samsung devices will now come preloaded with the My Business Online Android app and Pastel is a reseller of Samsung’s SIII, Note and Tablet devices; all preloaded with a year’s free access to Pastel My Business Online. The devices will be available for purchase via the Pastel Webstore.

BEE for SMEs (part 2 of 2)

By Saul Symanowitz: Divisional Director, BEE 123 by Pastel

Saul Symanowitz

SMEs and BEE

Whilst there is no universal definition for what constitutes an SME (Small and Micro Enterprise),for BEE  purposes most SMEs would be classified as EMEs (businesses with a turnover of below R5 mil pa) or QSEs (businesses with a turnover of a turnover of between R5 mil and R35 mil pa).

BEE for EMEs

As mentioned EMEs are exempt from the provisions of BEE and are automatically deemed to be BEE compliant.

EMEs therefore can continue to operate as they always have, with the status quo of their businesses remaining in place. No adjustments at all are necessary, and EMEs can therefore focus on the business of doing business and not BEE

The only thing EMEs will need to do for BEE purpose is obtain an EME BEE certificate, which is a quick and relatively cheap process. Once they have this certificate, they are able to reap the full benefits of being BEE compliant.

BEE for QSEs

As mentioned, QSEs are only measured against four of the seven BEE elements with each counting 25 points. What this means is that QSEs get to choose the four elements that make it easiest to get a really good BEE score in terms of their particular structure and requirements. Or alternatively viewed, they can quite validly leave out the three BEE elements they do not wish to engage with.

In my view, government has taken a very practical approach to how BEE is applied to QSEs, having taken into consideration the very real challenge of business survival and that many QSEs are in fact, family owned businesses.

So, how does a QSE business know which are the best four factors for its BEE scorecard?  Lets unpack each of the seven elements and see…

Ownership

Ownership measures equity held by black people in the business. For black owned businesses, this element will definitely be one of the four selected but for most white owned businesses it needn’t necessarily be a priority factor.

If you do select Ownership, it’s important to consider your structure. For QSEs, no additional points are allocated for black female owners but under the generic scorecard for larger businesses they are. So, if it’s possible, QSEs should structure their equity transactions in line with the requirements of the generic scorecard, so that no restructuring is needed in the future.

Management Control

This refers to black participation in top management. While a single appointee at this level can often have a significant effect on a BEE score, such appointments must be legitimate. Don’t forget that fronting may be criminalised under the current draft B-BBEE Amendment Bill!

Employment Equity

Employment Equity measures the percentage of black staff employed in the business.  The composition of one’s staff is not something that can be quickly changed, so the implementation of an Employment Equity strategy is often rolled-out as a long term commitment to transformation. However, if you employ black people at any level, and particularly black females, it may be worth including this element in your score card.

Skills Development

This element is designed to improve the skills of black employees. QSEs should be spending 2% of the annual wage bill on training, so depending on the size of your salary expenses and the importance the business places on up-skilling staff, this may be a worthy element to select as part of your scorecard.

But bear in mind that the BEE Codes require strict adherence to labour legislation such as compliance with the Skills Development Act, registration with a SETA,  etc before you can earn any points under this element. So, ensure that your ‘labour’ ducks are in a row; otherwise all effort and expense taken on training might not be recognised for BEE scorecard purposes.

Preferential Procurement

This refers to the BEE status of all suppliers. The more empowered your suppliers, the more points your business will earn on its scorecard.  So, preferential procurement is a relatively easy way to score BEE points; you just need to buy goods and services from companies that are BEE certified. But from a practical perspective this element is probably the most administratively intensive, as it requires collecting the BEE certificates of every supplier.

 Enterprise Development

Enterprise Development (ED) is designed to create sustainable small black owned businesses. QSEs are required to contribute 2% of their net profits after tax towards ED beneficiary businesses. Compliance with this element is relatively easy as it requires no restructuring and points can be earned by ‘writing a cheque’, should the business so desire. In order to ensure return on your ED investment however, instead of contributing to unrelated third parties, see if there are any ED beneficiaries within your own supply chain (your clients or suppliers) that you can develop.

Socio Economic Development

Socio Economic Development (SED) is grassroots development that brings black people into the economy as active participants. QSEs are required to contribute 1% of their net profits after tax towards SED beneficiary businesses. Like ED, simply ‘writing a cheque’ can get you points but it’s worth aligning your CSI initiatives with this element.  To earn BEE points from making contributions to charities or similar organisations, black people must constitute at least 75% of the beneficiaries supported by the organisation. In order to avoid unnecessary admin and complications when being audited, make sure that the organisation that you support has been issued with a Beneficiary Analysis Certificate, a special type of BEE certificate which examines the demographic composition of the beneficiaries.

Conclusion

Whatever your attitude towards BEE is-whether viewed as tax of sorts, additional compliancy requirement or as a tool to achieve genuine transformation in the workplace- BEE is here to stay.

The good news for you if you are an SME owner that BEE is far simpler and less onerous to implement than you probably had realised.

About BEE123 by Pastel

BEE123 is a newly launched division of Softline Pastel.

BEE123 is South Africa’s leading a one-stop BEE Portal that offers a complete range of useful tools, software, news, information and BEE network partners ensuring that BEE is easy to understand and implement. Developed using Softline Pastel’s infrastructure, and with a partner network of South Africa’s leading Verification Agencies and BEE service providers, BEE123 is at the cutting-edge of the BEE services industry.

Web: www.bee123.co.za

Email: info@bee123.co.za

Tel: 0861 BEE123 (233 123)

By Saul Symanowitz: Divisional Director, BEE 123 by Pastel

 

Saul Symanowitz

Introduction

It’s been around for more than 10 years, so there is no excuse to not be compliant with the regulations of Broad-Based Black Economic Empowerment, or BEE for short. BEE compliance is not compulsory by law, but it is recommended for all companies because it has become a real factor in winning and retaining business in South Africa.

Notwithstanding the above, BEE is an area where many misconceptions and negative attitudes still prevail. This is a pity, because, in my experience, once businesses understand how BEE actually works, they realise that BEE is actually far simpler and less onerous to implement than they had envisaged, especially for SMEs.

How BEE Works

So how does BEE actually work?

Not everyone knows that different sized businesses are treated differently for BEE.

  1. Exempted Micro Enterprises, or EMEs, are businesses that turnover less than R5million per annum. EMEs are free from the requirements of BEE. They are not measured by the BEE scorecard and are automatically considered as fully BEE compliant, achieving a level three contributor status if they are more than 50% owned by black people, and a level four if they are less than 50% black owned.
  2. Qualifying Small Enterprises, or QSEs, are those businesses with an annual turnover of between R5 million and R35 million. QSES are only measured against four of the seven BEE elements, with each counting 25 points.
  3. Generic Enterprises are businesses that turnover more than R35 million per annum. Generic Enterprises are measured in terms of all 7 BEE elements on the Scorecard, with differing weighting points for each element.

Herewith is a summary table of the above:

Element

Weighting

Generic(use all 7/7) QSE(use any 4/7) EME(N/A)
Ownership 20 points 25 points
  • Less than 50% black owned-

Level 4 BEE Status

 

  • More than 50% black owned-

Level 3 BEE Status

Management control 10 points 25 points
Employment equity 15 points 25 points
Skills development 15 points 25 points
Preferential procurement 20 points 25 points
Enterprise development 15 points 25 points
Socio economic development 5 points 25 points

Softline Pastel recently launched its one-stop Black Economic Empowerment (BEE) portal, BEE 123. It offers the complete range of tools, software, directories, news and BEE network partners to assist businesses of all sizes to understand and implement their BEE requirements.

“BEE compliance is a real factor in winning and retaining business, and is actually far simpler to implement than most people think,” says Saul Symanowitz, BEE 123 divisional director.

BEE123 includes Scorecard Software, which calculates empowerment scores. Users just have to enter the business’s data for each of the seven BEE elements without having to understand complex codes and formulae. Scenario planning is also possible in the software and its embedded help functionality explains BEE in simple English.

Proposed amendments to the BBBEE Act and the new PPPFA regulations which came into effect in December have elevated the necessity for BEE compliance, making it an essential for securing business. “A BEE certified company is able to access and generate new business because its clients will earn points by using them as a supplier,” says Mr. Symanowitz.

The directories within BEE 123 make it easy for users to find BEE certified businesses. The Suppliers Directory has thousands already listed and enables certified business to list themselves so that others can find them. According to Mr. Symanowitz: “For businesses that have gone to the effort and expense of obtaining their BEE certification, the BEE123 Suppliers Directory provides an unparalleled platform for exposure.”

The Socio Economic Development Directory lists all pre-vetted and qualifying charities and socio economic development support associations that will earn points on the BEE scorecard. An Enterprise Development Directory also lists registered development service providers and support organisations.

To provide a valid BEE certificate, Pastel has established a Verification Partner Network in conjunction with South Africa’s leading SANAS accredited verification agencies. This network will assist all businesses in obtaining their certificates. For Exempt Micro Enterprises – those with a turnover lower than R5M per annum – BEE certification is particularly simple. These businesses are automatically deemed to be BEE compliant and can obtain their BEE certificates directly through the BEE123 portal quickly, cheaply and easily.

Other features include a news section, FAQs, glossary, relevant BEE legislation documents and access to hands on training sessions on practical BEE knowledge and Scorecard Software.

“With the growing consensus amongst private sector businesses that empowerment is vital to trade and an important tool for economic growth, there is nothing to stand in the way of all enterprises becoming compliant. And now BEE 123 offers a one stop solution.” concludes Mr. Symanowitz.

Visit  www.bee123.co.za for more information