1. Background• Established in 2006, Seda Construction Incubator (SCI) is a public benefit

organisation mandated to develop and mentor emerging construction

companies in South Africa.

o The Incubator is aimed at providing support to selected participants for a

period of three years by which each Emerging Contractor should have

advanced by at least one financial level above their entry point on the

CIDB register and be capable of operating unassisted in the open market.

o The construction incubation model is one of the interventions, but not theonly one that can make a significant impact to addressing the challenges

faced by emerging contractors in South Africa.

o There is consensus amongst the majority of client bodies that the modeloffers a good strategy to assist emerging contractors.

o The level of formality the SCI model brings to the industry is also widelyacknowledged and appreciated.

Background CONT…

• SCI implements the incubation programme as follows:

Tender Stage support

Pre-Construction

Construction Management

Site Supervision

Business Performance

Post Incubation (after 3 year-term)

2. RATIONALE AND PURPOSE OF THE CONSTRUCTION INCUBATOR

Business incubation provides:

A nurturing, instructive and supportive environment for

entrepreneurs during the critical start-up phase.

The goal of incubators is to increase the chances of a SMME

to succeed, reduce establishing costs and growing the

business.

Within business incubators there are Mentors that provide

business and technical support and mentorship.

Mentorship has proven to be one of the effective interventions

that make a significant impact in addressing the challenges

faced by the SMME’s internationally.

RATIONALE AND PURPOSE OF THE CONSTRUCTION INCUBATOR Cont…

SCI provides mentorship support to emerging contractors in three

critical phases namely:

• tender phase

• construction phase and

• post tender support (as well as general business administration

support).

To date, SCI has supported over 2021 clients (including walk-

ins) and have graduated more than 250 clients across 6 of the 11 branches.

3. WHO THE PROGRAMME IS AIMED AT

The SCI programme is aimed at providing support to selected

participants for a period of 3 years broken down into two phases:

• Pre Incubation (CIDB grade 1 and 2) - Where within a period of 18

months an Emerging Contractor is expected to advance to at least

one CIDB grade above from the point of entry to the incubation

programme and

• Mainstream Incubation (CIDB grade 3 and above) - Where within a

period of two to three years the Emerging Contractor is expected to

advance to at least one CIDB grade above from the point of entry to

the incubation programme and capable of operating unassisted in

the open market.

• This CIDB grading mechanism works hand in hand with the CETA

accredited training and both form a major indicator of the

performance of the Incubator as well that of the individual

contractor.

4. SERVICES OFFERED BY SEDA CONSTRUCTION INCUBATOR

TENDER PHASE SUPPORT;• The Identification of Work/Project/Tender Opportunities• Skills and Capacity Audit/Assessment• Pricing and Estimating• Assistance on compilation and submission of tender documentation• The Facilitation of Performance Guarantees;

• Insurances, in particular Contractors’ All Risk, but also other insurances;• Statutory Registration compliance, notably CIDB, VAT, PAYE, WCA, UIF• Once a project is secured via appointment by the Client Body, the following activities will be facilitated by the

Incubator:• Programming and Resource Scheduling;• Cash Flow Forecasting;• Site Administration Systems Development, including budget and Actual cost reporting;• Quality Control mechanisms;• Work Measurements and Payment Certification;• Claims for Variations and Extras;• Management of sub-contractors• General Business Administration

CONSTRUCTION PHASE SUPPORT;• after securing or being awarded the contract, there is a contractual period in which the contractor has to

prepare for occupation or possession of the site.

Site Supervision;• Stronger Site Supervision allows the contractor’s management teams a certain amount of independence and

autonomy, thereby creating opportunities.

POST TENDER PHASE SUPPORT;• As much as an incubatee will be supported during a project, but there could be challenges that show signs of

being more prevalent during the construction phase. The challenge will be tackled during tender phase and during post tender phase, at this stage the mentors will assess the situation and provide group or individual workshops.

5. PERFORMANCE

The Seda Construction Incubator currently has 11 branches in four provinces namely KwazuluNatal, Gauteng, Eastern Cape, and Limpopo the combined performance for the year2017/2018 is as follows:

• NB: This financial year year has seen a slight decline in some areas due to a lack of projects and other external factors that have a ripple effect on SMMEs.

SCI KPI Targets Achieved Reasons for

deviation

Clients/ SMME’s

Supported

300 269 Drop Outs in the

programme due to

external economic

factors

Jobs Created

(Permanent)

1000 1033

Temporal N/A 89 Temporal jobs

cannot be ignored in

the sector as it is a

sector trade strategy

for profitability for

SMME’s.

Turnover

Accumulated

R300 Million R 299 564 621

Graduation

planned

80% 24% Co-Ordination of

Structured Training

with CETA and Drop

Outs

Women Owned 40% 34% Targeting Criteria

Youth Owned 35% 28% Chronological Effects

6. Recruitment Process

Placement of advert/invitation of applications

using cidb database

Collection and Submission of

application form

Check for compliance e.g

Tax

Assessment of application form

by centre management

Tabled through the adjudication

committee

Approved / referred

back/deciline

7. Infrastructural Resources for Contractors Across SCI Branches

Boardroom Facility Training Room

Shared Receptionist & Switchboard

Facility

Furnished Office Cubicle

7. Infrastructural Resources for Contractors Across SCI Branches

Resource Centre Professionalism: Contractors using boardroom

facility

Office Cubicles Allocated for Contractors

8. Human Resources Available to the contractor

Resource Sub-resource

In-house Mentors/Staff In-House Professionals including

construction management

professionals, civil engineers,

architects and electrical

engineers. In seldom cases

there would be a need for

quantity surveyors.

Business Development Officer Business Development Officers.

For soft skills SCI has in-house

business development officers

who give advice on businessrelated issues.

9. SUCCESS STORIES

Gabade Building and Projects – 2nd place during the South African

Trading as 6 GBPE, 3 CEPE & 2SQPE from 3GB when joining the

programme

Business Incubation awards in two categories namely;

Outstanding incubator client and

Outstanding incubator graduate

Split Bar Agencies (Mthatha graduate)

Trading as 6CE, 6GB CIDB grading from 2GB,2CE when joining the

programme

The business owns various plant for hire and 4 buildings towards office

space

3rd place in South African Business Incubation Conference Awards 2016,

for outstanding incubator graduate (noting that competitiors were from

various sectors countrywide)

10. SUCCESS STORIES

CONTRACTOR NAME CIDB GRADING LEVELS AT

INTAKE

CURRENT GRADE CIDB Best Annual Turnover

Buyelaphi and Son Construction 4GB,1CE 4GB PE, 2CE PE2 = 650K4 = 2m

Inkwa Trading 2GB PE,3CE PE 6GB , 3CE PE

2 = 650 K3= 1m6= 6,5m

Isambulosethu Trading 4GB PE, 1CE PE 4GB PE , 3CE PE3 = 1m4 = 2m

Ithembalakusasa Development Servicers

3GB PE,2CE PE, 4EB PE

6GB PE,4EB PE,4SQ EP, 6CE PE

2 = 650K3= 1m4 = 2m 6 = 6,5m

10. SUCCESS STORIES cont..

CONTRACTOR NAME CIDB GRADING LEVELS AT

INTAKE

CURRENT GRADE CIDB Best Annual Turnover

Mdeke Contracting and Trading 2GB PE 3GB PE2 = 650K3 = 2m

Mandlofo Trading 4GB PE 5GB PE4 = 2m5 = 3,25m

Mantuntu Construction Services 4GB PE 5GB PE4 = 2m5= 3,25m

Singabanqobi Trading 1GB PE, 4CE PE 4GB PE, 4CE PE 4 = 2m

Take Note Trading 5GB PE,5CE PE 6GB PE, 6CE PE5=3,25m6 = 6,5m

11. Achievements and Accolades

Women In Construction Awards (Africa)

Runner Up 2016

Incubator of the year

3rd Place - SABIC Awards 2016

Training Institution of the year

2015 South African Construction Awards

Incubator of the year

2009 DTI (SEDA Technology) Awards

Incubator of the year

2011 DTI SEDA

Thank You!!!

www.seci.org.za

031 368 1207