1. FOODBEV SETA Food and Beverages Manufacturing
Higher Education and Training Portfolio Committee
27th October 2010
Ravin Deonarain
CEO

2. Introduction and Appreciation
Thanks and Appreciation:
Hon Minister of Higher Education and Training
Hon Chairperson of Higher Education and Training Portfolio Committee
Hon Committee Members
Representatives of FoodBev Seta
Council Chairman: Mr Willie Prinsloo
Corporate Services Manager: Ms Liezl Gerryts
CFO: Mr Raj Rajcoomar
Skills Development Projects Manager: Mr Khotso N Potele
CEO: Mr Ravin Deonarain
Ravin Deonarain

3. Presentation Outline Food & Beverages Manufacturing Sector
Funds Management
NSDS Performance
Customer Satisfaction
Portfolio Committee’s Specific Emphasis
Strategic Plans F2010/11
SWOTs Analysis
Provincial Allocations
Youth Unemployment
Ravin Deonarain

4. FoodBev Sector Economic Characteristics
Diverse sector
Price sensitive products
High production volumes – costs driven
Capital intensive and technology driven
Intense brand competitiveness
Dominance - large companies and multinationals
Large number small food manufacturers (85%)
Mergers and acquisitions (brands)
Ravin Deonarain

5. FoodBev Sector Typical Companies
SA Breweries, Kellogg's, Nestle, Frito-Lay Simba, ABI, Coke Cola, Tiger Brands, Pioneer Foods Premier Foods, Clover, Oceana Fishing, Enterprize Meats, Nabisco, McCain's Foods, Beacon, Cadbury’s
Bokomo, Distell, KWV ………….
Ravin Deonarain

6. Economic Characteristics
Manufacturing Sector Output 28 % of GDP
FoodBev Contribution 18% of manufacturing sector
Wages ,7 % of manufacturing
GDP Contribution 5% of GDP
Employment % of total economy
Employees (80% large comp)
Companies registered/1800 levy
(BER, 2009)
Ravin Deonarain

7. Income/Expenditure Trend (Rm)
Ravin Deonarain

8. Highlights Unqualified Audit Report (10 yrs) Expenditure Rate 96%
Surplus R 7 m
Ploughed back into grants
Sector Challenge
Companies to accelerate progress of learning programmes
Increase Disbursement Rate - Reduce cash-on-hand
Ravin Deonarain

9. NSDS Targets Performance
Service Level Agreement
2009/10
Ravin Deonarain

10. Success Indicator 2009/10 Target PERF %age 80% LARGE 118 148 125%
2.1 80% OF LARGE FIRMS’ AND 60% OF MEDIUM FIRMS’ EMPLOYMENT EQUITY TARGETS SUPPORTED BY SKILLS DEVELOPMENT. IMPACT ON OVERALL EQUITY PROFILE OF FIRMS AND SECTORS MEASURED
Success Indicator
2009/10
Target
PERF
%age
80% LARGE
118
148
125%
60% MEDIUM
130
162
Ravin Deonarain

11. 2.2 SKILLS DEVELOPMENT IN AT LEAST 40% OF SMALL LEVY-PAYING FIRMS SUPPORTED AND IMPACT MEASURED
Success Indicator
2009/10
Target
PERF
%age
40% SMALL
330
435
132%
Ravin Deonarain

12. Success Indicator 2009/10 Target PERF %age BEE Co’s supported 32 48
2.5 ANNUALLY INCREASING NUMBER OF SMALL BEE FIRMS AND BEE CO-OPERATIVES SUPPORTED BY SKILLS DEVELOPMENT. SURVEY PROGRESS AND MEASURE IMPACT.
Success Indicator
2009/10
Target
PERF
%age
BEE Co’s supported 32 48
150%
Ravin Deonarain

13. 2.7 700 000 workers have achieved ABET Level 4
Success Indicator
ABET Level 1- 4
2009/10
Target
PERF
%age
Entered
367
998
272%
Completed 75
503
671%
Ravin Deonarain

14. 2.8. 125 000 WORKERS ASSISTED TO ENTER AND AT LEAST 50% SUCCESSFULLY COMPLETE APPROVED PROGRAMMES
Success Indicator
Learning Programmes
2009/10
Target
PERF
%age
Entered
768
1760
229%
Completed
460
1058
230%
Ravin Deonarain

15. Success Indicator Skills Dev Support 2009/10 Target PERF %age
non-levy paying enterprises, NGOs, CBOs, and community-based co-operatives supported by skills development. Impact of support on sustainability measured with a targeted 75% success rate.
Success Indicator
Skills Dev Support
2009/10
Target
PERF
%age
NGOs, CBOs, Co-ops
Non Levy Paying Companies 66
115
174%
Ravin Deonarain

16. 4.1. 125 000 unemployed people assisted to enter and 50% successfully complete programmes
Success Indicator
Learning Programmes
2009/10
Target
PERF
%age
Entered
500
1057
211%
Completed
385
695
181%
Ravin Deonarain

17. To Gain Work Experience -
% of learners in critical skills programmes covered by sector agreements and Nat Priorities from local FET and HET institutions assisted to gain work experience. 70% find placement in employment or self-employment.
Success Indicator
2009/10
Target
PERF
%age
To Gain Work Experience -
Find placement after completion 50 69
138%
Ravin Deonarain

18. 70% operational after 12 months 21 47 224%
,000 young people trained and mentored to form sustainable new ventures and at least 70% of new ventures in operation
Success Indicator
New Venture Creation
2009/10
Target
PERF
%age
Entered - 31
310%
70% operational after 12 months 21 47
224%
Ravin Deonarain

19. ISOE’s recognised/supported 1 100%
5.1. By March 2010 each SETA recognises and supports at least five Institutes of Sectoral or Occupational Excellence (ISOE) within public and private institutions and through Public Private Partnerships (PPPs)
Success Indicator
2009/10
Target
PERF
%age
ISOE’s recognised/supported 1
100%
Ravin Deonarain

20. New Venture Creation Provider 4 5 125%
5.2. Each province has at least two provider institutions accredited to manage the delivery of a new venture creation qualification. 70% of new ventures still operating after 12 months
Success Indicator
2009/10
Target
PERF
%age
New Venture Creation Provider 4 5
125%
Ravin Deonarain

21. SAQA Audit of FoodBev SETA 1 100%
5.3. Measurable improvements in the quality of the services delivered by skills development institutions
Success Indicator
2009/10
Target
PERF
%age
SAQA Audit of FoodBev SETA 1
100%
Ravin Deonarain

22. Customer Satisfaction
Ravin Deonarain

23. Customer Satisfaction
Ravin Deonarain

24. Major Highlights Exceeded Targets Unqualified Audit Report – 10 yrs
Strong Focus
Artisan Development
Processing and Packaging Operations
Leadership and Management Development
World Cup 2010
Training of food and beverages vendors/suppliers - fanparks
Ravin Deonarain

25. Performance Scorecard F 2009/10
Percentage Score
0% - 60%
61% - 80%
81% - 100%
101% - 120%
>120%
Rating 1 2 3 4 5
Performance Description
Performance is Poor
Performance is below Requirements
Performance meets Requirements
Performance is above Requirements
Performance is Excellent
Score: 4.80 = Excellent
Ravin Deonarain

26. Year-on-Year Performance
2003/4
2004/5
2005/6
2006/7
2007/8
2008/9
2009/10
DoL
Rating
Excellent
5/5
Above
Reqm
4/5
NSDS 1
NSDS 2
NSDS/SLA target performance for sector
Financial Performance
Ravin Deonarain

27. Committee’s Specific Emphasis
SWOT’s Analysis
Strategic Plans F2010/11
Provincial Allocations
Youth Unemployment
Ravin Deonarain

28. Potential Internal Strengths
YES NO
Core competences in key areas a
Adequate financial resources
Well thought of by market
Well-conceived functional/operational strategies
Access to economies of scale
Insulated from strong competitive pressures
Proprietary technology e.g. Learnerships
Ravin Deonarain

29. Potential Internal Strengths
YES NO
Cost advantages a
Better advertising campaigns
Product innovation skills
Proven management
Ahead on experience curve
Better processing capability
Superior technological skills
Ravin Deonarain

30. Potential Internal Weaknesses
YES NO
No clear strategic direction a
Obsolete facilities
Subpar effectiveness because…
Lack of managerial depth and talent
Missing some key skills or competences
Poor track record-implementing strategy
Plagued with internal operating problems
Ravin Deonarain

31. Potential Internal Weaknesses
YES NO
Falling behind in R & D a
Too narrow a product range
Weak market image
Unable to finance needed changes in strategy
Higher overall unit costs relative to key competitors

32. Potential External Opportunities
YES NO
Serve more customers a
Enter new/other markets or segments
Expand product line - broader range of customer needs
Look into related products
Faster market growth
Ravin Deonarain

33. Potential External Threats
YES NO
Entry of lower-cost competitors a
Rising attractiveness of substitute products (non accredited skills)
Costly regulatory requirements
Vulnerability to recession and business cycle
Changing customer needs
Ravin Deonarain

34. BUDGET F2010/11 SKILLS LEVY BUDGET SPLIT NSF 46.3 ADMINISTRATION 21.2
MANDATORY GRANTS
106 .0
DISCRETIONARY GRANTS
42.4
NSF PROJECT
5.2
INTEREST/PENALIES
10 .1
TOTAL
231.2
Ravin Deonarain

35. Discretionary Projects
Ravin Deonarain

36. Ravin Deonarain

37. Youth Unemployment Projects Spend (Rm)
Entrepreneur Development through New Venture Creation
Young Entrepreneur Support
Mentorship
Business Plans
Linkages - support organizations (SEDA, banks, etc.)
CIPRO Registrations
Community Based Organisation Grants
Internships & Work Experience Grants
Ravin Deonarain

38. PROVINCIAL SPREAD (Poverty Alleviation)
NVC
NGO
Ravin Deonarain

39. “……the SETAs do not provide training
“……the SETAs do not provide training. They have a legal duty to disburse 80% of the skills development levy funds and are constituted in governance structures to represent a partnership between government, business and labour to direct skills training in various sectors. The SETAs also work at different levels of the training hierarchy and are intermediaries between business and training institutions using organised networks for workplace training.”
Min Blade Nzimande
Skills Summit
9 Sept 2010
Ravin Deonarain

40. Thank You
Ravin Deonarain