With all the information we have about SMMEs so far, there’s no doubt as to how important they are for South Africa. Aiding the economy, improving the unemployment rate and potential for innovation on South African soil is just the tip of the iceberg. There are challenges however. In order to save SMMEs in South Africa, we need to overcome these challenges and do so with posthaste. It’s not an impossible task; by coupling our good old South African resourcefulness and work ethic with some well thought out government policies, it’s absolutely doable.
Understanding the Reasons for Failure in SMMEs
People who start an SMME and fail are not necessarily lazy, stupid or any other pejorative generalisation which may initially come to mind. Starting your own business is undoubtedly one of the most difficult ways to earn an income. That said, it may also be one of the most fulfilling ways to do so. The chance of success is also greatly improved by identifying and anticipating any potential challenges. Issues as insufficient funding, inadequate cash flow and rapid growth can all be barriers to success.
In much the same way as the government has transformed business in the country as a whole through BEE policies, there are ways for the government to support SMMEs through similar thought processes. This can be done in many ways, two of which are with the help of appropriate tax policies and benefits for larger companies who invest in and support SMMEs.
You don’t have to look far to find the words South African government and corruption in the same sentence. There is simply no denying it or ignoring it. While billions of rands continue to be wasted through corruption and inefficiency, there is no urge to push for, properly implement or ensure the growth of small businesses. It’s those SMMEs which are so badly affected by non-payment for services rendered and goods delivered which suffer. Why not instead nurture and bring upliftment to local communities and businesses.
Going back once again to local communities, those which are impoverished need the cycle itself to be broken, lest they remain trapped in a cycle of poverty. Through grassroots programmes which support early learning and childhood development, children already have more educational support than their parents had and thus their opportunity to grow beyond their circumstances is already improved. Of course government policy could enhance the efforts of related nonprofit organisations.
Empowerment Through Education
Side-by-side with grassroots programmes is the topic of education. We all know the earlier a person’s education commences, the better. That doesn’t mean that it’s ever too late to educate someone though. Grassroots education doesn’t only start in childhood, it also starts with helping those who are most in need. By offering someone who may be deemed unskilled the kind of education which will help them start their own business and improve their circumstances, you are also cutting down to the grassroots to aid a community. Education on topics such as financial management and marketing form the cornerstone of just about any business and cannot be taken for granted.
In truth, sometimes the simplest solutions are the best. If we can look at the obstacles which SMMEs face on a daily basis, we can begin to understand exactly how we can grow the sector itself. While improved government policy will aid the growth of SMMEs through supportive policies and funding, we still need to take a proactive approach to optimising SMMEs and gearing them towards success. – and that is where you come in.