Qualifying Small Enterprises (QSEs)

QSEs are classified as businesses that earn a total revenue between R10 million and R50 million.

To participate in YES, QSEs must meet one of the following sub-minimum requirements:

1) They need to either achieve a 40% average across two of the three priority elements (Black Ownership, Skills Development and ESD), with Black Ownership being one, or

2) They must achieve 40% of their sub-minimum requirements in two of the three priority elements, with Black Ownership being one.

How to work this out:

1. Option 1: 40% average across two priority elements

Essentially, QSEs must meet a minimum of a 40% average of targets in two of three priority elements listed above, with Black Ownership being one.

For Black Ownership, the total target is 8 points. For Skills Development, the total target is 25 points. The total target for Enterprise and Supplier Development is 30 points.

If you opt to have an average across Black Ownership and Skills Development, the total points required is 13.20 points [(8 + 25 = 33) x 40%].

If you opt to have an average across Black Ownership and ESD, the total points required to participate in YES under this sub-minimum is 15.20 points [(8 + 30 = 38) x 40%].

2. Option 2: 40% of sub-minimum in priority elements

For this sub-minimum, you must have reached at least 40% of two priority elements targets.

Option 2a: Because the total target for Black Ownership is 8 points, to participate in YES under this sub-minimum, your QSE would need a minimum of 3.2 points in this priority element (8 x 40%). Likewise for Skills Development (total target = 25 points), your QSE would need to have achieved 10 points in this priority element (25 x 40%).

Option 2b: Alternatively, you can opt to reach 40% sub-minimums in both the Black Ownership element (8 points) plus the ESD element, which is broken down into three sub-elements:

• - Preferential Procurement (20 points x 40% = 8 points needed)
• - Supplier Development (5 points x 40% = 2 points needed)
• - Enterprise Development (5 points x 40% = 2 points needed)
• - Therefore, a total of 12 points is needed under the Enterprise and Supplier Development element

Remember, once again, this is not an average, and your generic enterprise needs to achieve these minimums in either in the Black Ownership + Skills Development combination, (Option 2a) or in the Black Ownership + ESD (Option 2b) element, if you would like to participate in YES under this sub-minimum.

What do these sub-minimums mean for QSEs?

These sub-minimums show that even with limited or no Black ownership, your QSE could still participate in YES, change lives and receive your B-BBEE level up(s).