Home grown IT business unleashes technology potential in townships

Luvuyo Rani

For Luvuyo Rani, founder of Silulo Ulutho Technologies, turning his home grown IT business into a franchise was a dream for the foreseeable future. Little did he know that after partnering with the Standard Bank Franchising Incubator his dream would be realised sooner than he thought, with 200 stores expected to be up and running by 2024.

“Before creating the franchise, we had grown from a single store in Khayelitsha, a township in Cape Town, in 2004 to 36 branches in the rest of the Western Cape and Eastern Cape by 2015” says Rani. “That’s no small achievement, but it had taken an enormous amount of painstaking work because at the time, we were functioning as managers of people rather than entrepreneurs.”

According to Ethel Nyembe, Head of Small Enterprises at Standard Bank, the owner-manager commitment of a franchisee automatically works in the business owner’s favour, as it allows owners to facilitate and accelerate growth. She adds that franchisees want to succeed as much as the franchisor does. Committed franchisees are likely to push for innovation rather than being comfortable with the status quo. 

Rani agrees. “For us, franchising has unleashed capacity we couldn’t have achieved otherwise.”

Servicing communities 

Silulo Ulutho Technologies makes the use of technology affordable, reduces the cost and time needed for people to gain technology skills, and gives marginalised communities desperately needed access to the tools of the mainstream economy.

The company is a provider of IT related products and services in under-serviced areas such as townships and rural areas, where it is needed the most. It puts computer training skills, software installation, website development, computer and accessory retail sales, and computer and mobile phone repair and maintenance services right on the doorsteps of people who would otherwise have to travel considerable distances to access such facilities.

The company also offers refurbished computers, Internet cafe services, printing, scanning, copying, creation of CVs, typing of letters and assignments, faxing, binding, lamination, CD and DVD writing and copying, and design of custom obituaries. 

It also provides technology services companies such as Telkom with penetration points into communities that don’t have existing infrastructure. This opens up new business opportunities for both Silulo Ulutho Technologies and its potential corporate business partners, creating job opportunities and new value chains at many levels of society.

“Silulo Ulutho Technologies more than met our criteria for incubating franchise businesses because it had not only survived well past those first two critical years of a start-up business, it was profitable, it was black-owned, it was meeting the needs of the community, and the 

founders were willing to invest time and money in the process of developing a franchise,” says Ms Nyembe. “The business was also clearly replicable, which is important in the franchising industry. Franchisees would not be confused about what was needed to maintain Silulo’s unique offering at a level that would retain customer loyalty and, therefore, ensure growth for both the franchisor and its franchisees.”

Accelerating growth

Getting to the point of franchising has not been easy for Rani.

Without having a clear idea of what he really wanted to do after school, he became a teacher for the stable income. Three years into his teaching career, his exposure as a youngster to entrepreneurship in his mother’s shebeen kicked in as he identified a need among teachers to have computers they could work on from home.

He and his brother began to sell refurbished computers from the boot of his car. He encouraged his customers to form stokvels to enable them to save the money to buy his stock. 

Very quickly he realised that, while people were keen to buy, the time it would take for them to save enough would negatively impact his sales. So, he started an Internet cafe, which would at least give his customers more rapid access to computers. 

The difficulty with this idea, however, was that his potential customers needed computer literacy training before they could use his Internet cafe. However, existing courses were expensive and the cost of travelling to town to attend them was prohibitive.

So, with a grant from the SAB Kickstart and certification from the MICT SETA, Rani started a training centre in Khayelitsha that included a retail section and an Internet cafe.

Five years later, in 2009, he used funding from the United Kingdom to open another three stores. By 2012, he had 18 stores across the Western Cape and then ventured into the Eastern Cape, where he now has three stores in East London and several in Umtata and surrounding areas.

Turning point

In 2014, he was introduced to the Franchising Incubation programme in which Standard Bank collaborates with Franchising Plus. The programme focuses on helping entrepreneurs develop a sound strategy for expansion, using franchising as the growth mechanism. The first step in this process is to ensure that the fundamentals and the systems of the business are correct. A proven blueprint for successful replication is then applied and the new franchisor is mentored for six months to ensure that the business becomes sustainable.

Rani says that this was the turning point for his business. “The Standard Bank Franchising Incubation programme helped my Silulo Ulutho Technologies management team put in place the right building blocks for growth. Even though we had built a successful business, we weren’t 

sure how to transition from a small operation to one with a national footprint. Also, the people we were employing were new to business and had never participated in setting up business structures and procedures or doing business modelling.”

“We realised that franchising would give us a proven framework to follow, ensuring not only that our business would grow but that, in the process, we could develop other small enterprises and ensure their success. The Franchising Incubation programme has helped us move in that direction, because it gave us clarity about next steps. As a result, we are comfortable that our ambition of having 200 stores in all provinces of South Africa and in the SADC region in the next ten years is perfectly doable,” he adds.

Rani is passionate about empowerment and wants his success to trigger success for others. He looks forward to Silulo Ulutho Technologies being instrumental in the technological growth in townships.”

“Standard Bank is committed to the franchising sector. Enquiries can be directed to franchising@standardbank.co.za or 011 344 5438”