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BUSINESS MODEL
AND STRATEGIC
OBJECTIVES
LEADERSHIP
GOVERNANCE
SHAREHOLDERS’
INFORMATION AND
ADMINISTRATION
OPERATING
PERFORMANCE
FINANCIAL
PERFORMANCE
BLUE LABEL INTEGRATED ANNUAL REPORT 2014
73
Prepaid airtime and starter packs
Prepaid airtime and starter pack sales continue to
generate the majority of this segment’s profitability.
Benefit starter packs catering for pregnant women,
insurance cover for accidental death and funeral plans
and value-adding bundling with DVDs, such as the
Nelson Mandela Commemorative, are examples of
differentiators between the Group and traditional
distributors of prepaid airtime.
The importance of a targeted approach is that starter
packs are distributed to market in a strategic manner
which maximises activation and in turn the resultant
annuity revenue stream.
The introduction of low-cost POS terminals, branded
“business in a box” and “Rechaja Mo” (recharge
here) continues to gain momentum. Both devices
were developed for merchants and vendors in the
rural market, in pursuance of managing “the last
mile” of the distribution channel. Another innovation,
“Chat 4 Change”, has been enabled across all
platforms. This variable denominational airtime
top-up mechanism offers customers a quick and
simple choice of utilising spare change on a
transaction to purchase airtime to that value rather
than being bound by the fixed denominations offered
by the networks.
The wholesale strategy remains robust with a solid
trader base of approximately 1 000 wholesalers who,
in this physical mass environment, supply over
100 000 retailers with some 80 million bulk print
airtime vouchers per month.
As is customary when opportunities avail themselves,
bulk purchase transactions are concluded with the
networks at favourable discount rates.
The Prepaid Company (TPC) is the leading distributor of
prepaid products for all the major network operators.
TPC also facilitates, manages and maintains the
distribution of all virtual products and starter packs.
These services are supported by proven proprietary
technology, which ensures purchasing efficiency,
managing the distribution channel and inventory
control. Relationships with each of the network
operators are key to the success of this business. TPC is
responsible for supplier agreements and procurement
for the Group, wholesale and community sales,
starter packs and handsets and facilitating its
merchants with bulk airtime printing capabilities.
Group Treasury falls under the ambit of TPC.
Blue Label Distribution (BLD) distributes products
through POS terminals, integrated gateways, vending
machines, touch screens and RICA devices. BLD is
supported by eight sales branches across the country
situated in Sandton, Cape Town, Durban, Port
Elizabeth, Bloemfontein, East London, Nelspruit and
Polokwane. Each branch performs the functions of
sales, customer service and field support. A 24/7
customer call centre for merchant and UniPIN
support, as well as airtime and electricity sales,
strengthens their efficient levels of service.
The Post Paid Company (TPPC) distributes hybrid
top-up postpaid airtime and data contracts on behalf
of all major South African cellular networks. TPPC
also distributes handsets, tablets and various
insurance products, including handset cover and
death benefits. TPPC’s distribution channels in South
Africa include outbound call centres, various major
banks, micro-lenders, retailers, schools (via an online
portal) and companies wishing to offer TPPC’s services
to their employees.