SmallBusiness Struggle in South Africa Starting your own business isn’t easy. South Africahas 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 tobe an important contributor to South Africa’s economy, providing employment toabout 60% of the labour force.To make a business successful, hard work is not onlyrequired, its expected.
Regardless of the type of business you own, it’s alwaysa constant learning experience. Finance is, of course, a major part of startinga business, but it’s not the only part. Many business owners underestimate thecapital 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 enticecustomers. While this may work for a while, a successful business needs goodrevenue. There’s thisquote “If you fail to plan, you plan to fail.” Opening a business without doingany research, whether it involves location, the product or service you’reproviding, or even the kind of image you want to project, is a mistake many newbusiness owners make.
Be aware of your strengths and weaknesses. Beingcomfortable in the knowledge that your employees are skilled or has a good workethic and understanding of the business is also important. There are also a number of government initiatives whosupports and recognises the importance of SMEs, helping them secure fundingthrough various financial enterprises. There are so many mistakes new businessowners make, and while it’s true that we learn from our mistakes, how many ofus can afford it? Know what you’re getting yourself into. Educate yourself onwhat you need, how much you’re going to need and how often you’re going to needit. Be prepared.