SMEs are once again in the background. Very little new is going on which is new. There is a SME conference in Bloemfontein 26 and 27 July. Contact the Bloemfontein Chamber of Commerce for details.
The conference appears to be different to the run of the mill, so here's hoping it is.
Another finance related conference will take place in November with the KZN Treasury the possible sponsor. This too should be an unusual conference. I will provide more info as time progresses.
New info will be advised as it becomes available.
Showing posts with label SMEs. Show all posts
Showing posts with label SMEs. Show all posts
Sunday, July 22, 2012
Sunday, July 1, 2012
SMEs - what SMEs need to do
SMEs are desperately in need of help and protection - from themselves. While it is easy to sit back and criticise government, especially when they make it so easy to do so, but surely we have responsibilities as well.
How many SMEs take advantage of government efforts to assist business? How many SMEs complain in writing to government about what is wrong? How many SMEs have identified their weaknesses? Do you know what your weaknesses are?
The fact is that every business has these components:
1. Administration
2. Finance
3. Marketing (excluding sales)
4. Sales
5. Technical skills
The first three can all be outsourced to an external party such as an accountant or a consultant. However, the process of selling and technical skills are the two components you cannot outsource. These the owner of the business has to do themselves or employ people to do it. However, especially in a smaller business, this increases the risk of failure if staff resign. Furthermore early stage businesses can sometimes not afford these employees, so the owner has to do them.
But the admin, finance and marketing are also critically important, and outsourcing should be seen as a temporary status. It is imperative that business owners gain at least an understanding of these areas of expertise, such that they can interpret and make decisions upon the information provided by the accountant or consultant. Would you like to drive a car at speed with a blindfold on, and some one telling you when to turn and when to brake. Unlikely that you will enjoy the experience!
So the contribution SMEs can make is to improve their skills, as well as those of their staff. I am always reminded of the story and the CEO who was big on staff training. At a meeting with fellow CEOs in his industry, one of his peers mentioned the fact that they loved the fact that he trained people so well as they helped the industry to find good people. They then asked him why trained when he knew they might leave. His response was that if he did not train them, they might stay. Think about it!!
So in conclusion, the best thing SME owners can do is to realise their limitations and then ensure they reduce these by gaining sufficient knowledge to at least understand things, even if they are unable to do them.
How many SMEs take advantage of government efforts to assist business? How many SMEs complain in writing to government about what is wrong? How many SMEs have identified their weaknesses? Do you know what your weaknesses are?
The fact is that every business has these components:
1. Administration
2. Finance
3. Marketing (excluding sales)
4. Sales
5. Technical skills
The first three can all be outsourced to an external party such as an accountant or a consultant. However, the process of selling and technical skills are the two components you cannot outsource. These the owner of the business has to do themselves or employ people to do it. However, especially in a smaller business, this increases the risk of failure if staff resign. Furthermore early stage businesses can sometimes not afford these employees, so the owner has to do them.
But the admin, finance and marketing are also critically important, and outsourcing should be seen as a temporary status. It is imperative that business owners gain at least an understanding of these areas of expertise, such that they can interpret and make decisions upon the information provided by the accountant or consultant. Would you like to drive a car at speed with a blindfold on, and some one telling you when to turn and when to brake. Unlikely that you will enjoy the experience!
So the contribution SMEs can make is to improve their skills, as well as those of their staff. I am always reminded of the story and the CEO who was big on staff training. At a meeting with fellow CEOs in his industry, one of his peers mentioned the fact that they loved the fact that he trained people so well as they helped the industry to find good people. They then asked him why trained when he knew they might leave. His response was that if he did not train them, they might stay. Think about it!!
So in conclusion, the best thing SME owners can do is to realise their limitations and then ensure they reduce these by gaining sufficient knowledge to at least understand things, even if they are unable to do them.
Sunday, July 12, 2009
SMEs in South Africa - why is finance difficult to access
SMEs in South Africa do struggle to raise start-up finance from banks. The question is why?
There has been little, if any, in-depth research into why banks are not lining up to lend to this large, risky, yet very profitable market.
I myself am hoping to research the following suggestion in order to see if it has any validity. The suggestion is that a major contributory factor is that SME and entrepreneur are being interchangably used in South Africa.
There is a continuum of entrepreneurial endeavour suggested by Burch, and I believe that the SME owner is not synonymous with being an entrepreneur. Some SME owners may well be entrepreneurial, but it is not a given.
Consequently, banks have no tools with which to assess these SME owners, which makes the loaning of finance to them extremely difficult.
There has been little, if any, in-depth research into why banks are not lining up to lend to this large, risky, yet very profitable market.
I myself am hoping to research the following suggestion in order to see if it has any validity. The suggestion is that a major contributory factor is that SME and entrepreneur are being interchangably used in South Africa.
There is a continuum of entrepreneurial endeavour suggested by Burch, and I believe that the SME owner is not synonymous with being an entrepreneur. Some SME owners may well be entrepreneurial, but it is not a given.
Consequently, banks have no tools with which to assess these SME owners, which makes the loaning of finance to them extremely difficult.
Sunday, June 7, 2009
SMEs in South Africa - the African opportunities
As suggested in my blog 2 weeks ago, the African markets present a big opportunity for South Africa.
I saw some data which says despite the recession, Africa should still achieve 6+% GDP growth this year, albeit that it is off a low base. South African trade data show an increase in South African / Africa trade already, as well as the expected decline with USA and Europe.
The big corporates are already trying to penetrate these markets, but SMEs can do so as well.
There are a number of Africa oriented business magazines around. Have a look and get yourself informed. I purchased "African Business" and found a lot of useful information.
I saw some data which says despite the recession, Africa should still achieve 6+% GDP growth this year, albeit that it is off a low base. South African trade data show an increase in South African / Africa trade already, as well as the expected decline with USA and Europe.
The big corporates are already trying to penetrate these markets, but SMEs can do so as well.
There are a number of Africa oriented business magazines around. Have a look and get yourself informed. I purchased "African Business" and found a lot of useful information.
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