Five out of seven small, medium and small enterprises in South Africa fail within the first year. Photo: Getty
Business is being hailed as a key factor in South Africa’s economic recovery – and the good news is that all signs point to an upward trend.
According to the Global Entrepreneurship Monitor (GEM) 2021/22 report released by Stellenbosch Business School, there has been a dramatic rise in early-stage entrepreneurship among South Africans aged between 18 and 64, highlighting “source” as a base. starting a business or working for less than three years.
Claire Klassen, an expert on consumer finance at Momentum Metropolitan, said that it is important that the emergence of this new type of business, small business and on the side.
“In the wake of Covid-19, South Africa’s unemployment rate has increased significantly, with many businesses forced to close or retrench workers. Young people are the most affected, because they are often the ones who are often exposed to the sectors affected by the disease, such as work, hospitality and retail. With little work experience under their belt, they are often the first to show up when companies cut jobs. “
Klassen says that South Africans are resourceful and, with the income necessary for survival, many began to look at new ways to get food.
Interestingly, the GEM report also looked at social attitudes towards entrepreneurship, finding that 81.8% of respondents thought entrepreneurship was a good career option, while 20% of non-entrepreneurs had marketing goals.
Although this is encouraging, five out of seven small, medium and small enterprises in South Africa fail within the first year. We need a full flight path to see this surge now that early stage entrepreneurship is generating tangible economic benefits. We are in a window of time of opportunity, and it is make-or-control time.
So what resources are there for budding entrepreneurs that will help set them up for success?
Klassen offers a variety of advice for those considering starting their own business or doing something on the side.
Get financial wise
It is important to have good financial knowledge and understanding of the things related to marketing.
“A savings bank is very important to cover important business start-up costs, such as an emergency or a ‘savings fund’ that will help ensure that the fire continues while your business continues.
There are free online tools that will help improve your financial knowledge. Doing it with Majolas is a free, free online finance course, with its latest edition focused on business.
“It teaches basic financial concepts that are important for entrepreneurs to understand, such as how to set up a business budget, tips for negotiating with suppliers and the importance of putting together a solid business plan – all combined with a hands-on, easy-to-follow storytelling process,” Klassen explains.
“Metropolitan also supports a Facebook group, MetroKickStarz, which is dedicated to helping young, budding entrepreneurs through its financial education programs. I would encourage aspiring entrepreneurs to join this community, which gives them the opportunity to network, share ideas and gain valuable knowledge and other resources for free.”
He added that it is important that entrepreneurs determine their personal and business budgets, and not mix the two.
“Seeking the advice of a financial advisor will help you make better decisions and protect your business.”
Learn from those who have done it
Klassen recommends that people who want to start their own business research companies or events that are successful.
It is important to understand why they work, what makes them different from their competitors and what they do well – or not so well.
Find out more about the founder and learn about their practice. Do they believe in continuous learning? Perhaps there are certain principles or philosophies they live by that guide them. Understanding what goes into starting a successful business — and the small daily actions that make you successful — will make a big difference in the trajectory of your business,” he says.
There are free conferences and networking events relevant to various industries; A quick search online will help you find out what is supported in your country.
“Attending these events will give you an invaluable opportunity to network and learn from experienced business leaders.”
Take advantage of available financial opportunities
Public officials have made several initiatives to benefit business owners.
Visit the Development Corporation website or the Small Business Administration website to apply for a business loan.