November 18, 2019

Small owners make, and while it’s true that we

Small
Business Struggle in South Africa

                                   

Starting your own business isn’t easy. South Africa
has one of the highest failure rates of new SMEs (Small and Medium Enterprises)
in the world. According to an online article in Moneyweb,
approximately 70% to 80% of small businesses fail within the first  5 years. Despite this, SMEs are considered to
be an important contributor to South Africa’s economy, providing employment to
about 60% of the labour force.

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To make a business successful, hard work is not only
required, its expected. Regardless of the type of business you own, it’s always
a constant learning experience. Finance is, of course, a major part of starting
a business, but it’s not the only part. Many business owners underestimate the
capital needed to start a business. In a bid to stay ahead of the competition,
businesses often price products and/or services at a lower rate to entice
customers. While this may work for a while, a successful business needs good
revenue.

 There’s this
quote “If you fail to plan, you plan to fail.” Opening a business without doing
any research, whether it involves location, the product or service you’re
providing, or even the kind of image you want to project, is a mistake many new
business owners make. Be aware of your strengths and weaknesses. Being
comfortable in the knowledge that your employees are skilled or has a good work
ethic and understanding of the business is also important.

There are also a number of government initiatives who
supports and recognises the importance of SMEs, helping them secure funding
through various financial enterprises. There are so many mistakes new business
owners make, and while it’s true that we learn from our mistakes, how many of
us can afford it? Know what you’re getting yourself into. Educate yourself on
what you need, how much you’re going to need and how often you’re going to need
it. Be prepared.

 

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