Sunday, May 27, 2012

SMEs - chambers of commerce in South Africa

In respect of SMEs, the chamber of commerce situation in South Africa is interesting. There were four original Chambers of Commerce ion South Africa. South African Chamber of Commerce and Industries (SACCI formerly SACOB),AHI, NAFCOC, and FABCOS. While none of them ever limited membership to any particular race or cultural group, SACCI was always perceived to represent the English white businesses, AHI the Afrikaans white businesses, and NAFCOC and FABCOS black businesses. Today SACCI and AHI actively seek membership from all race groups, while NAFCOC and FABCOS tend to only attract black members. Government attempted to force a merger of these bodies, under the BUSA/CHAMSA umbrella, and failed dismally. BUSA still exists but it has little to no interest in SMEs. The national South African Chamber of Commerce & Industries does nothing for SMEs and they have no interest therein at all. However, their constituent members, the local Chamber of Commerce, are generally comprised of 70+% SMEs. A number of these such as Pietermaritzburg, Durban, Bloemfontein among others do fantastic work for SMEs. However, they have experienced a large decline in membership, I would imagine due to retirement and emigration. They are the local representatives of the IP rights for the name Chamber of Commerce, which is an internationally protected trademark as I recall. The national Afrikaanse Handels Instituut is very small, and generally their members are also members of the local Chamber of Commerce, and tend to be more of a cultural organisation for Afrikaans business people.Their membership numbers are very small, and they have much fewer members than the Chamber of Commerce's. Another Chamber of Commerce is Minara, which targets Muslim businesses, and was only established in 2000. Then there is a plethora of new chambers of all of whom claim membership in the thousands. It is not clear what real value they add, and whether they really do have the membership numbers they claim to have. Time will tell whether or not they are money making scams for the organisers. However, the membership will make that decision for themselves based upon a sense of value received. The established chambers of commerce are only interested in big businesses, and there are a number of reasons why this is so. However, the new chambers have little if any interest in matters related to representing SMEs and SME issues to government. There one or two who claim to be acting on behalf of SMEs and attempting to engage with government, but based upon the extremely vitriolic comments from some of them, they are more likely destroy SME relationships with government than build them. All these Chambers combined have at most a combined membership of SMEs in the region of 60 000 to 70 000. However, consensus indicates that there are at least 1.5m to 2.5m SMEs in South Africa. This tells it's own story. Does the SME community need a decent representative body to represent their interests in respect of the private and public sector? Absolutely! Is it available now? No! Will it happen in the near future? Unlikely! Why not? Because as with all things in South Africa everything is segmented into narrow interest groups. There is no need for religious, racial, cultural, sectoral segments within the SME group. There is only place for a single SME group.

Wednesday, May 23, 2012

SMEs - are government hindering or helping?

SMEs in South Africa will find that they are in a bitter sweet situation here in South Africa. Against government: 1. Rabid unions 2. SME insensitive bargaining councils 3. Poor government marketing of what they really do offer SMEs 4. Poor payment 5. Regulatory overload and red tape 6. Rigid labour markets 7. Slow decision making and implementation 8. An inactive Presidential SME Council that fails because of political appointees 9. BEE legislation that helps no one. 10. Too much stick and not enough carrot. Make the Nats look open minded. For government 1. Massive amounts of capital 2. Numerous interventions to assist SMEs 3. A desire to help The problem is that on balance I believe the overall impact is negative, but could easily be swung around if there was a political will to do so. If SMEs are so important, who is more valuable to the government? SMEs or the unions? I believe the SMEs are.

Tuesday, May 8, 2012

SMEs - finance for South African SMEs

There is an interesting new website for businesses seeking funding in South Africa and it can be found at this website