Food dominates BoP household budgets. In South Africa, food expenses typically represent more than 35% of expenditure of low income households. As incomes rise, however, the share spent on food declines.


Food security is a major challenge for low income households. While a large proportion of food products are sold by informal traders- called “spaza shops”- a number of major retailers (including Walmart) are currently aggressively targeting peri-urban low-income markets in South Africa. This strategy could have significant repercussions on the sustainability of the spaza shop business model.


Significant consulting missions aimed at spaza shops have allowed Inclusive Consulting students to gain an understanding of local markets, particularly when it comes to challenges within the supply chain. For a real life example, take a glimpse at Ma Bertha’s spaza shop.



 

Fast Facts


“In Africa the BOP market, $429 billion, is by far the region’s dominant consumer market representing 71% of aggregate purchasing power.” Source: next 4 Billion


Only five products represent nearly 60% of a spaza shop’s income: sugar, maize meal, rice, oil and meat


An estimated 30 million people in South Africa are at risk of micronutrient deficiency, particularly in vitamin A, zinc and iron

Discover more about specific sectors at the base of the pyramid in South Africa














Food

Housing & EnergyHousing_%26_Energy.html
Textiles & CraftsTextile_%26_Crafts.html
Entertainment & Personal CareEntertainment_%26_Personal_Care.html
Transportation & CommunicationsTransportation_%26_Communications.html