Fintech’s Zande Africa signs up 1,400-plus spaza shops
● Fintech company Zande Africa has signed up more than 1,400 spaza shops, helping them to obtain lines of credit to buy stock and take advantage of better pricing from manufacturers and producers that don’t usually deal with small operators as they can’t buy in bulk.
Nielsen valued the spaza shop market at R46bn in 2017 while AMPS valued it at R50bn.
The domestic spaza market is growing at about 10% a year, but the market is characterised by unbanked spaza owners with limited or no access to financial products, making it difficult for them to deal with fastmoving consumer goods companies that generally do not open lines of credit with small retailers that order in small quantities.
Spaza owners usually buy from wholesalers such as Makro (part of Massmart) and Devland Cash and Carry, rather than directly from producers and manufacturers.
Zande Africa CEO Siya Ntutela and COO Mdu Thabethe launched Zande (formerly called Invoiceworx) in 2017 to help spaza shops get access to finance. With operations in Mpumalanga, it has passed the R10m mark in annual revenue. It has two depots, in Mbombela and Ermelo.
“One of the primary reasons spaza shop owners don’t succeed is a lack of finance and broken supply chains,” said Ntutela. “The credit facility we offer assists owners to fill their stores and avoid stock-outs. Providing this working capital unlocks the trading and employment potential of thousands of individuals and businesses.”
The spaza shops they deal with obtain the products within 24 hours of placing orders, and Zande is also working on a driver app that will be live by May.
The company plans to expand its offerings to spaza shops in and around KwaMashu, in KwaZulu-Natal.
How does Zande differ from competitors such as SpaZapp, eSpaza Sum and Selpal?
Ntutela said Zande was more focused on solving problems in the supply chain, making it easier for manufacturers and suppliers to have more routes to market, while at the same time providing convenience and credit to spaza shops.
He said Zande Africa’s spaza credit offering is a first in SA, and none of the other start-ups are focused on the last-mile delivery and getting the product to market.
The business won third place in the SAB Foundation Social Innovation Awards 2018, and won R1m and support from Merrill Lynch SA and AlphaCode in 2016, an award that sought to identify and reward South African financial-technology entrepreneurs with high potential.