BEE boost for small businessesBY DANIEL BUGAN

SMALL black-owned businesses will receive a significant boost in their attractiveness to supply to large companies and government when the revised Broad-Based Black Economic Empowerment (B-BBEE) codes, gazetted by the Department of Trade and Industry (DTI) last month, comes into effect in October next year.

All businesses, regardless of the level of black ownership, with an annual turnover of less than R10 million will be categorised as Exempted Micro Enterprises (EMEs) and will be exempted from Black Economic Empowerment (BEE) verification. This implies that they will not have to do a BEE scorecard, as is currently the case, and that they are no longer required to get a BEE certificate from a BEE verification agency. Instead, the owner can make a sworn statement to confirm the turnover level and black ownership status.

Currently, EMEs are auto-matically awarded a level four BEE status, regardless of the level of black ownership. This allows their clients to count 100% of their purchases from the EME as BEE procurement.

The main adjustment in criteria to be classed as an EME is that the annual turnover level will be increased from R5 million to R10 million, which will allow many more small businesses to benefit from the BEE exemption.

A further shift will come into effect for EMEs which are black-owned. Businesses that are 100% black-owned will automatically be awarded level one BEE status, which allows their clients to count 125% of their spend with these EMEs as BEE procurement. If an EME is more than 51% and less than 100% black-owned, it will

automatically be awarded level two status, with 115% of clients’ spend counted towards BEE procurement.

Those with a turnover between R10 million and R50 million – adjusted from the current figures of between R5 million and R35 million – are considered Qualifying Small Enterprises (QSEs) and, unlike black-owned businesses, must still follow the entire scorecard with very few allowances or easier aspects to its

scorecard to the generic scorecard which applies to large firms.

In general, the revised codes are fairly similar to the existing codes, although some weightings and names of some elements have been changed. Instead of seven elements, there are now five. However, they still contain mostly the same indicators as before.

The five elements are ownership, management control, skills development, enterprise and supplier development and

socio-economic development. The revised codes add some punative measures for non-compliant large companies that will be penalised through a discounting of BEE levels to lower levels.

Surprisingly, business owners Small Business Connect spoke to were not clued up on how they would be affected. Helen Marokoane of Puletso Construction says she has not read the codes and is not sure how it will impact her. “We are not exempted and

we are using scorecards but I still need to familiarise myself with it,” she says. Sharon Prodehl, owner of Universal Mail, says compliance will cost her R8 000. “I have always chosen to do a scorecard regardless of whether I needed to or not. I found we get contracts since we have a scorecard, but did not get when we did not have scorecards,” says Prodehl. She does not foresee a big impact on her business because she has always had a scorecard.

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Since receiving R600 000 from the Small Enterprise Development Agency (Seda) Technology Programme, Northern Cape business owner Isak Andrews, who runs Andrew Peers Megawatt cc, has increased his turnover and productivity by 63% within six months. He has also secured big contracts with Eskom and nearby municipalites and has employed an additional six people. Says Andrews: “Seda does not merely promise. They deliver, whatever it takes. Their clients, of whom I am one, receive the best service. I am deeply impressed and pleased with the way in which they have supported me.” He is pictured above with Querida Meyers. Contact Peers at andrewpeersmegawatt @gmail.com.

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Facing common challengesSMALL Business Connect was at the DTI’s National SMME Summit held in Mpumalanga recently.

Here business owners had the opportunity to ask questions and raise important challenges they face.

The common challenges highlighted were access to retail shelf space with large retailers, not having time to manage different aspects of the business and access to funding.

“Every time we go to the IDC for funding, they have changed their policies and their priority sectors,” said one young female entrepreneur. “The last time I went to apply for funding for my business, they told me they will only fund manufacturing. I am not in manufacturing but I can still create jobs. Just the transport to go to all these agencies to apply is costing me a lot of money.”

Joshua Mngomezulu, based in Mpumalanga,started Barocco Paving in 2010 and employs 8 people. He proudly displays an album of photographs showing high-quality paving in creative patterns.

“I am trying to get a contract from Cashbuild to supply them with paving, but I need funding to do that. If I got it, I could employ up to 30 people,” he said. Joshua trains his staff himself and considers himself a paving expert. “But if I cannot grow this business, I am going to look at opening a Builder’s Warehouse in this area as a franchise,” he says.

Iris Conochie started her skincare cosmetics business in 2009 because none of the usual products helped with her skin. Today she has an impressive-looking range called Conoché, using a unique omega oil formula. She received help from incubators Sasol Chemcity and eGoli Bio.

“My biggest challenge is to try and sell to the retail chains,” she says. She has tried Woolworths, Edgars and Clicks, among others, but so far not one retailer will give her a listing.

“At least Clicks gave me valuable feedback – they told me exactly what containers and bottles I should use to make the product more shelf-friendly, and how to improve branding.”

These are just some challenges faced by businesses.We hope that what we offer in Small Business Connect will help make this sector the driver of economic growth it can be.Martin Feinstein, Strategic Partnerships Director

New co-ops support agency to open doors

BY MARTIN FEINSTEIN

A NEW Co-operatives De-velopment Agency, and Co-operatives Training Academy, will open soon, says the Deputy Minister of Trade and Industry, Elizabeth Thabethe.

Speaking at the DTI’s national SMME Summit, Thabethe said that these institutions, together with a Co-operatives Tribunal, will help develop the sector.

Further details are sketchy at this stage, but it is likely that the new agency will operate on a similar basis to Seda, with a focus on co-ops.

The training academy will come as a welcome service for many co-op members who require business training.

Government is looking closely at resuscitating “the old industrial parks and business hives, to provide for suitable business infrastructure for small businesses – many of these spaces are lying idle.”

If these are re-established and refurbished, they will create a new network of business premises ideal for small manufacturing companies.

Another possible support measure that was hinted at is the development of a small business credit rating system outside of the financial services industry.

“The lack of credit data, or what is called credit information asymmetry, remains a real

constraint for SMME funding.“We need to find ways so that

SMMEs are not always burdened by bad credit records and then finding it unable to ever secure funding,” she says.

Thabethe had harsh words for some township entrepreneurs: “The scourge of South Africans in townships selling and renting their businesses to foreigners unfortunately does not assist us as government in our efforts to support informal businesses.

The DTI is working on a new informal business strategy that will go a long way to support township businesses.”

“A programme to promote bulk buying, and the re-skiling and upgrading of township retailers and support of backyard mechanics and spraypainters, for example, is envisaged to enhance the growth and sustainability of township and rural businesses,” she said.

She says small businesses who are unfairly blacklisted can approach the DTI for assistance.

The MEC for Economic Development for Mpumalanga, Mrs Pinky Phosa, said the unemployment rate in the province was 29.4% and that the poverty rate was 39.4%.

“We have a sizeable task ahead, with 70% of our population under the age of 35.

“We need more small businesses so that we can grow by 5 to 7% per annum, so that we can make in impact,” she said.

Beware of bogus ‘agents’BY MARTIN FEINSTEIN

THE Director-General of Trade and Industry, Lionel October, issued a strong message of caution to business owners to be wary of using so-called “consultants” to assist them to register or change the details of companies with the Companies and Intellectual Property Commission (CIPC).

“There are small businesses who are falling prey to consultants who are charging up to R3 000 for something that in fact only costs R170,” he said.

“We urge small businesses to be wary of using self-styled business registration consultants who do not add value and are simply charging exorbitant fees for doing what any business owner can easily do themselves,” he said.

The CIPC offices in Sunnyside, Pretoria, frequently swarm with “consultants” who solicit and canvas people entering the premises. They offer to “expedite” and “fast-track” applications and scare would-be customers with warnings of lengthy delays in doing business with the CIPC.

The CIPC has had to put up large banners warning that the CIPC does not employ or use “agents”, and that visitors should be cautious of using “consultants”. Small Business Connect observed agents even stopping cars to offer their services. The CIPC allows

anyone to register as a user, so there is no longer any need to use representatives.

In another development, the CIPC has introduced an e-filing service for the lodging of new trademark applications. It successfully rolled out the first-ever e-service in the intellectual property domain.

“It is particularly important to the CIPC that individuals can apply for trademark protection directly with the CIPC, and the new web-based service makes it much easier than it was before,” said Ms Astrid Ludin, Commissioner of the CIPC.

In August 2013, the CIPC launched the new online Annual Return functionality and also launched its partnership with FNB, which allows for registering a business and opening a bank account at the same time via a FNB branch or on the FNB website. • For more information, visit

www.cipc.co.za.

Grants for township businessesBY MARTIN FEINSTEIN

THE Department of Trade and Industry (DTI) is planning a new small business grant programme aimed at township businesses to improve their production and become better suppliers to formal businesses.

Speaking at the National SMME Summit in White River, Mpumalanga, the Director-General of the DTI, Lionel October, said the new grants will range between R5 000 and R50 000 and are designed to enable the purchase of equipment and basic business necessities without which businesses find it difficult to function and produce goods.

“We have not done enough for small businesses and especially rural and township businesses. We need a new delivery model for these new grants,” he said.

“We are planning a R1.2 billion package of support measures, primarily aimed at assisting small township businesses and co-operatives to upscale and be more capable of becoming real suppliers to bigger business.”

He said the DTI was planning to partner with municipalities on a 50:50 cost-sharing basis to ensure a more accessible way for small businesses to get these grants.

“In other countries, when big businesses grow, the small businesses follow and also grow

through a symbiotic relationship. This hasn’t happened enough in South Africa for structural

reasons. We have done a lot to build industrial capacity in sectors like the automotive sector, now we need to help build the capacity of small businesses,” he said.

October also disclosed that the DTI had approved funding for a further 27 incubators to start or expand.

Government was on track with its plan to have 250 small business incubators in the next five years, to provide entrepreneurs with a supportive environment to ensure sustainability. Support for co-operatives in the agriculture and agri-processing sector would also be increased.

October says the DTI had created many structures to support small businesses – “but we haven’t yet really cracked the problem. The problem is not in starting businesses.

What we need is improved market access. We must get more small busness owners into supply chains of the private sector, as this makes up 70% of the economy – government only accounts for 30%.”

More than 600 delegates attended the summit, including small business owners develop-ment practitioners, municipal and provincial officials, corporate representatives and NGOs.

Iris Conochie, who built up a good comsmetics business through support from Sasol Chemcity and eGoli Bio, displayed her products at the summit.

Lionel October

www.SmallBusinessConnect.co.za November 2013 - page 3

Incubation support for technical operators without education

BY DANIEL BUGAN

ENTREPRENEURS with technical skills but lacking in formal education have now been given the opportunity to start their own companies through a Soweto-based incubation programme.

The Seed Container Park (Secopa) incubation programme was introduced by the Department of Trade and Industry (DTI) with the intention to help highly skilled machine operators and manufacturers to start their own businesses.

Secopa business development manager Tsepo Mohapi says: “These operators and manufacturers have acquired their skills through on-the-job training but have been denied the opportunity to acquire front-end company management skills.”

The Secopa model enables operators to work under a branded company while learning skills like marketing and job costing until they are ready to function independently.

“This approach encourages a small business manufacturing culture, economic empowerment and employment opportunities in South Africa. The emphasis is on the creation of a small, dedicated and profitable manufacturing business park with a strong sense of participation and ownership.”

Formally launched in March 2013, it further assists clients with business basics, networking, marketing, financial management, access to funding, mentorship, regulatory compliance and management, and intellectual property management.

The Small Enterprise Development Agency (Seda) assists Secopa with administrative capacity, training, advice, funding, compliance and other non-financial support.

Mohapi says successful completion of a business incubation programme increases the likelihood that a start-up company will stay in business for the long term, with studies having

found 87% of incubator graduates stayed in business, compared to 44% of other businesses.

To date, some 40 entrepreneurs in a variety of sectors were assisted in Gauteng and the Free State and are willing to expand. The

programme runs for three years, but in order to get assistance from Secopa, you have to be interested in business, willing to put in long hours, understand your market and have some technical capacity in your area of operation.

They identify those skills, form a business plan and submit it to the Secopa board of trustees. If the business plan is satisfactory, Secopa helps set up the business by providing a container from which to work.

empowering industries and broadening economic participationthe dti Customer Contact Centre: 0861 843 384

Website: www.thedti.gov.za

Amnesty to ease business finance BY NABELAH FREDERICKS

BUSINESS owners who are unable to access credit due to negative information which has been retained on their profiles despite being able to afford credit might see some relief soon if the Removal of Adverse Credit Information Project is approved by government.

This is according to McDonald Netshitenzhe, chief director of policy and legislation at the Department of Trade and Industry (DTI), after Cabinet accepted a proposal by the Select Committee on Trade and International Relations.

“At the moment we have opened the project up for public comment for 30 days, where we will hold workshops and meet with industry players such as the Banking Association of South Africa (Basa) and debtors and also do media interviews to get

feedback and create awareness,” says Netshitenzhe.

Three proposals were made by the committee and the medium risk option was chosen, which includes the removal of all adverse information listings by credit bureaux irrespective of value and non-payment, the removal of all adverse paid-up information listings by credit bureaux on an ongoing basis, and the removal of all paid-up judgement information held by the credit bureaux on an ongoing basis.

Commonly known as credit amnesty, the project will see negative information removed off some 1.6 million affected consumer credit bureau profiles if approved and aims to give those with impaired credit profiles who are able to afford credit, access to credit.

According to Netshitenzhe, the amnesty is a result of a study

by government which was done to see whether it was “doable to remove the impaired records of people who could afford credit” in order to grow the economy.

“Our economy is not thriving because consumers are heavily indebted,” says Netshitenzhe.

He says it is still unclear how far back they will look when removing the adverse information, but that removing negative information from consumers’ profiles would be ongoing as is being done in Brazil.

Sidwell Medupe, spokesperson for the DTI, stressed that this should not be confused with debt being written off.

“Negative information will be removed but they will still be liable to pay the debt as it will not be written off,” says Medupe.

The DTI is currently busy drawing up an awareness campaign aimed at educating consumers on the amnesty.

Operators with technical skills, but without a formal education will benefit from the incubation programme.

Seda reports progress with business support

BY DANIEL BUGAN

THE Small Enterprise De-velopment Agency (Seda) once again underlined its position as the key small enterprise development organisation in the country when it released its annual report for the 2012/3 financial year recently.

The addition of 10 in-cubators during the reported year increased the Seda Tech-nology Programme incubator network to 42, supporting more than 2 000 small firms, which in turn offer job opportunities to more than 2 300 employees.

Government hopes to further increase the number of incubators in South Africa through the recently established Incubation Support Programme.

In accordance with this programme, the Department with Trade and Industry (DTI) collaborates with the private sector in setting up new incubators.

The development of high-tech and high-growth sectors will be the main business of these incubators.

Another area reported on is the SMME Payment Assistance Hotline which facilitated payments of R46.86 million during the year under review and brought the total payments facilitated since its inception in September 2009 to R347.88 million.

Some 28 operational secondary cooperatives were also supported.

Seda increased its footprint in the Western Cape with an additional 12 satellite branches.

Three critical areas were identified to be priotised going into the future: focused communication and advocacy on small business issues, taking a medium-term to long-term view of small business development, and focusing on demand-side issues to enhance the performance of the small business sector.

page 4 - November 2013 SMALL BUSINESS CONNECT

Settlement sparks investment interestBY STEPHEN TIMM

DRAWING the ire of one of the world’s biggest internet companies has been an unexpected boon for a young small town internet entrepreneur who dropped out of school in grade 8.

Andries Maree van der Merwe, who taught himself to code, saw the number of hits on his site Doogle.co.za rocket from around 2 000 per month to 1.1 million per month on the day news hit the web in November 2012 of Google’s intention to sue the 23-year-old.

Since then, traffic to his site has fallen to a respectable 50 000 hits per month, even after he opted for an out-of-court settlement with the web giant in February for an undisclosed sum, which resulted in him changing the name of the site to Vroopleys.

But Van der Merwe doesn’t seem perturbed by this, particularly as the attention has helped attract interest from at least one overseas investor, whom he says he met he through social network site LinkedIn.

Van der Merwe, who lives in Middelburg, Mpumalanga, declined to name the investor who he has yet to meet with, saying only that he was from one of the big five internet companies.

Many may say he backed

down, but Van der Merwe doesn’t have any misgivings about opting to settle with Google.

“If I didn’t take the settlement, I would have had to go to court, which would have cost R300 000,” he says, adding “it’s not a bad settlement, I’m happy with the settlement”.

As part of the settlement, the search engine giant agreed to allow him to use the Doogle.co.za domain name – which directs to his new domain name Vroopleys.com – for six months. Van der Merwe, who was forced to drop out of school for personal reasons, added that he’s “not mad at Google.”

Ironically, it was thanks to Google that he was able to teach himself how to code and build his website. That, and having a home far away from traffic, in the bush, helps him to think and spend long hours on his computer.

Yet while his site drew Google’s ire, two other similar-sounding ones are still live. The one, doogle.com, is a forum site, and doogle.org is a search engine claiming to be from Ireland.

He reckons Google decided to take him on because as a young, ambitious guy, he represents a threat to the internet giant. He says the two other similar-sounding sites have been around

for some time and get few hits. In another case involving a

wrangle over intellectual property, an independent softdrinks owner who took on Woolworths last year and won, said that the retailer had complied with the Advertising Standards Authority’s (ASA) ruling made in January last year.

The ASA ruled that the retailer must remove within three months from its shelves all drinks products bearing the slogan “good olde-fashioned”.

Mike Schmidt of Frankie’s Olde Soft Drink Company believed Woolworths copied his slogans and straplines and used the same drink flavours he had developed after he

had pitched the softdrink to the retailer a few months before.

Schmidt, who has since trademarked the slogan “good olde fashioned softdrinks” and a “taste of yesteryear”, said he had since met with Woolworths’ chief executive, Ian Moir, and that there were no hard feelings.

Schmidt said an unexpected outcome from the saga was the sudden 40% spike in sales, which created temporary cash flow and

distribution problems. Business owners who find

that a competitor has copied their product or service can turn to the Advertising Standards Authority (ASA). They will, however, have to pay a non-refundable fee of R19 608 for their case to be investigated.

In 2012, of the 2 103 complaints the ASA received, 147 were competitor complaints, with about three-quarters of these lodged by large firms on behalf of recognised brands. As of the end of September this year, the ASA had received 60 competitor complaints.

ASA manager of dispute resolutions, Leon Grobler, said 86 competitor complaints were investigated, a further 32 were dismissed – some of them because complainants did not elect to pay the non-refundable fee – and 30 were upheld. The balance was spread predominantly between companies undertaking to voluntarily amend or withdraw their ads, or where some other resolution was reached between the parties, he said.

Owners confident that business will flourish

BY NABELAH FREDERICKS

ENTREPRENEURS are confident about growing their businesses but are concerned about the economy and that not enough is being done to assist small businesses.

This is a key finding of the recent Business Partners Limited SME Index (BPLSI), which shows that the average confidence levels for growth in business are up by 2% compared to the previous quarter.

According to Nazeem Martin, managing director at Business Partners, people generally have more confidence in areas they can control.

“Entrepreneurs are human beings and feel more confident that they can control their businesses because they have survived so many difficult things in the past,” says Martin.

However, as they do not have control over the economy, confidence levels were rated under 50%, which means that they are moderately confident in the economy.

“Entrepreneurs are confident in their own ability to grow their businesses and confidence levels are therefore at 73%,” says Martin.

He says South Africans need to be more positive and optimistic and that in the last few years since 1994 growth has been between 3% to 5% compared to the 1% to 1.5% growth prior to 1994.

“We are not doing badly. Of course we can do better, like China and India, who are

growting at 8% and more, but we need to recognise that we are not doing too bad and that we are growing more since 1994,” says Martin.

He pointed out that the biggest challenge was that South Africans were supercritical and that this leads to a negative spiral.

“Business is all about confidence. If you undermine yourself by being negative, you will be reluctant to buy, start or grow a business.

I am not saying we should be blind, but we need to recognise the positive things and not undermine investment by being negative,” says Martin.

There was some concern regarding the levels of bureaucracy, which could make compliance more onerous for small business.

On being questioned regarding which type of assistance from government would be more beneficial, 30% of respondents ranked direct funding as top of their list, 25% advised that cutting red tape would be more useful, while 20% put tax breaks at the top of their list.

However, Martin says that a step in the right direction might be the recently established guidelines by the Department of Trade and Industry (DTI) to reduce municipal red tape for small businesses.

Business owners were also expecting the ease of access to finance to improve over the next twelve months, with confidence levels at 48% compared to 44% in the previous quarter.

Imbizo helps owner to bag fundingBY DANIEL BUGAN

MORE than 60 budding en-trepreneurs will be graduating this year as part of the Imbizo Business Acumen Programme, which is jointly managed by Nedbank, Old Mutual, Mutual & Federal, Masisizane and Wiphold.It seeks to increase economic activity and financial inclusion in rural communities.

According to Nkosinathi Msiza, senior communications manager at Nedbank, since launching the pilot project in 2012, the programme has helped more than 200 promising entrepreneurs, equipping them with training and mentoring to efficiently run their own businesses.

Says Msiza: “In 2011, the Imbizo steering committee wanted to develop a formal strategy that would guide future enterprise development in all Imbizo sites.

“The objective was to provide basic business acumen training and mentoring to people who were already running their own local small businesses.

“Another objective was to equip business owners with basic knowledge, skills and insight to run sustainable businesses.”

The pilot programme was rolled out at three Imbizo sites (Centane, Acornhoek and Kliptown) and aims to train 24 business owners per site, or 72 overall. Six mentors were trained to facilitate the course and to mentor participants.

In 2013, another intake of entrepreneurs was trained at the same sites due to spillover from 2012’s training sessions. In this intake, 72 clients were trained. The same mentors were used.

The Imbizo Business Acumen Programme consists of nine weeks of training. Business owners are then subjected to three months of mentoring, where they submit weekly money management forms to the mentors. Those who successfully complete the mentoring phase graduate.

After graduation, Imbizo continues to mentor business owners for a further six months.

Msiza says 64 business owners will graduate by end October, a step up from the 48 micro-business owners who graduated from the 2012 intake.

Most business owners who

participated were sourced from organisations and associations that are a part of the Imbizo network of stakeholders.

Criteria for the selection process include already being in a business, some level of high school education, literacy, at least six months of business experience, demonstrated commitment, and businesses that displayed viability and potential to grow.

Nhlanhla Maseko, owner of Kidos Design & Upholstery, specialising in renewing old furniture and car interiors, joined the Imbizo Business Acumen Programme in 2012.

He says: “I’m now able to properly market my business.”

Maseko’s business also received development financing from the programme partners to enable him to grow his business.

Imbizo Business Acumen graduates proudly show off their certificates.

Small town internet entrepreneur Andries Maree van der Merwe is happy with the settlement he reached with multinational internet giant Google.

www.SmallBusinessConnect.co.za November 2013 - page 5

Forum for ekasi businessBY DANIEL BUGAN

IN business, networking is the key to success, and this is exactly what an intrepid business networking forum is focusing on to boost the fortunes of entrepreneurs and economies in the townships.

Ekasi Business Network, which means “township” in isiXhosa, was established by entrepreneur Luvuyo Rani, who realised that there were no platforms in the townships to assist businesses.

Rani is a former teacher and started his computer sales business, Silulo Ulutho Technologies, from the boot of his Corsa Lite (see page 15 for more on Rani’s story).

Thando Makili, administrator at the Ekasi Business Network, says that the forum aims to stimulate entrepreneurship in the townships and to create a culture where entrepreneurs who operate in the townships buy from each other and trade among each other.

“We want to leave a legacy of growing the township economy, creating employment and inspiring others,” says Makili.

The Ekasi Business Network, launched about two years ago in January 2011, meets on a monthly basis.

“At every network forum we have an entrepreneur share his or her successes and challenges.

“We also invite organisations and entrepreneurs from outside the townships to come in and share their successes and challenges with us,” says Makili.

The forum gets support from SAB Miller in terms of logistics and the media, especially City Vision, who profiles the entrepreneurs on a monthly basis.

The networking forum is open to anyone who would like to do business in the townships and interact with other small businesses.

Aspiring entrepreneurs are also welcome to be part of the forum, and there is no membership fee involved.

Makili says they normally have between 40 and 60 businesses at every network forum.

Mandisi Peter of Digital Satelite Television (DStv) and computer cabling installation company Isitya, is one of those businesses. He says he has secured “lots of clients” at the networking sessions he attends in Khayelitsha.

Peter has also done business with schools and small businesses in Khayelitsa and other townships. He finds the mentorship programmes run by people in top management positions especially beneficial.

“It is also good to know that the challenges that you face in your business is not unique and that other business owners often face them too.

The advice you get there is invaluable.”

The regular networking

sessions and exposure to opportunities and mentorship have grown his business so much that he now employs 16 people.

Lufefe Nomjana, the owner of Espinanca Innovations, a company that provides healthy food alternatives such as spinach bread, says he has secured two contracts with business owners who are regulars at the Ekasi networking forums.

Ekasi connected him with Pick n Pay, which supplied him

with an oven as well as the first three months’ rent for his business premises.

The business network forum also arranged for him to attend a US-sponsored entrepreneurship programme, which “significantly developed his business knowledge”.

Nomjana says the demand for his products has grown as a result of the exposure he gets not only at Ekasi, but also in the newspapers that have featured his business. Luvuyo Rani, founder of the Ekasi Business Network

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Shop with conviction and pride and remember to check for the Proudly South African mark of quality and “Label of Origin” to ensure your first choice is local.

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Be Proudly South African. Buy local to create jobs.

page 6 - November 2013 SMALL BUSINESS CONNECT

African markets open doors for local business

BY STEPHEN TIMM

RENDANI Makhomu and Peggy Mahlaba are two of an increasing number of local entrepreneurs venturing into Africa, with many more gazing with renewed interest at the continent.

While Makhomu, who runs the Limpopo engineering company Tshete Holdings, plans to set up a small cold-mix asphalt manufacturing plant in Ghana, Mahlaba’s renewable energy firm has, since 2011, fitted solar panels and DC boxes in Zimbabwe and Benin and is now busy with a contract in Tanzania.

Trade figures released in October by the SA Revenue Service (Sars) show that Africa was the only region where exports grew in August over July – increasing by R129 million.

In August, the Nedbank Small Business Index revealed that 29% of a group of 1 374 business owners surveyed in the second quarter did business internationally (up 5% over the first quarter), while a further 32% said they planned to export (up 2% over the first quarter).

The euro crisis and the rapid rise in Africa is reflective in that, of those looking to do business internationally, just over two-thirds (67%) said they were

looking at entering the rest of the African continent, while just 12% plan to do business in Europe.

The Department of Trade and Industry (DTI) assisted Mahlaba, who owns Imbokotho Engineering, to arrange business-to-business meetings and helped her to fund trade trips through its Export Marketing and Investment Assistance (Emia) scheme, which covers up to 90% of the cost of accommodation, transport and other costs associated with attending trade shows, trade pavilions and trade missions.

In 2012/3, Emia gave out grants totalling R116 million to 1 541 companies to attend national pavilions and group missions – up from R88 million to 865 companies the year before.

“I strongly advise every entrepreneur to look at Africa. Just make the point of doing research and particularly use the DTI, because it’s there for that purpose [to assist exporters],” said Mahlaba.

She said that, although the continent represents a growing opportunity, business owners who want to export to the rest of the continent must have patience and tolerance.

During her work fitting solar panels in Benin, there was a sudden change in energy ministers, and

she was hastily summoned to the West African country before the contract could go ahead.

Another option is for business owners to join a trade mission. Makhomu said he joined the department’s trade mission to Ghana in June to explore possibilities of supplying asphalt there after he began manufacturing cold-mix asphalt in South Africa two years ago.

In September, he attended another trade mission in the Democratic Republic of Congo (DRC). “With a delegation it becomes easy – they open up discussion with local companies,” says Makhomu.

From 27 to 29 November, the department will lead a trade pavilion to Nigeria for firms in the metals, tooling and niche engineering sectors. The department will also lead a trade pavilion to the Ghana International

Trade Fair in February 2014.Another way to generate export

sales to the rest of the continent is to host your own buyers’ events – as Nelia Annandale, owner of manufacturer Keedo’s Children’s Clothing, does. Most of her orders to the continent are generated after clients buy her clothes in local stores or when people receive them as gifts from shoppers who have come to South Africa.

Annandale then invites buyers to her own private conferences, which she hosts twice a year, where customers can view new designs and can place orders.

“Africa has really been good to us in the past two years,” says Annandale, who began exporting to the rest of Africa around four years ago. Today, sales to the rest of the continent make up about 7.5% of total sales.

Trade figures from Sars reveal

that while Zambia remains the top export destination for South African goods – with exports growing by 83% between 2009 and 2012, to R21.8 billion – exports more than doubled over the same period to the DRC, to R12.2 billion.

Other top destinations where SA exports grew over this period are Zimbabwe (up 47% to R19.9 billion), Ghana (up 45% to R4.2 billion), Angola (up 44% to R8.2 billion) and Mozambique (up 42% to R19.3 billion).

The department hopes to conclude the rollout of its National Exporter Development Programme in the course of the 2013/4 financial year.

The programme offers exporter awareness training, a trade information system and export villages to pool resources and jointly overcome challenges that exporters face.

Nelia AnnandaleMakhomu Mahlaba

SEFA, THE SMALL Enterprise Funding Agency, has laid the groundwork to take up its role as the leading provider of accessible finance to South Africa’s small business sector.

Small Business Connect posed some key questions to Sefa on behalf of readers.

What is Sefa’s mission?

Sefa’s mission is to provide simple access to finance, linked to business support, in an efficient and sustainable manner to micro, small and medium enterprises throughout SA.

Who does Sefa aim to serve?

We aim to serve the entire small business sector, but our focus is

Sefa sets out to fill the business finance gap

on youth owned enterprises, the more rural provinces, women- and black-owned business.

However, these are focus areas – we will still entertain applications from any business that meets our criteria. Our industry sector focus is on services (including retailing, wholesaling and tourism), manufacturing, agriculture (including agri-processing, land reform beneficiaries and micro-farming), construction and mining.

What kind of funding do you provide?

Sefa provides four kinds of funding. We offer revolving or bridging loans to support delivery on a contract, as well as for short-term capital needs, preferably backed by a formal order or contract. We also offer asset finance for acquiring fixed assets such as machinery. In addition, we offer term loans to finance longer-

term business expansion, and for general working capital. Sefa does not take an equity interest (shareholding) in the business.

And what amounts can be accessed?

Sefa can lend between R500,000 and R5-million, depending on the size of the business and the specific business circumstances.

What are the repayment terms?

The repayment terms can vary from several months to five years, depending on the specific business circumstances. We evaluate each application on merit.

Who is eligible for Sefa funding?

You must be a SA citizen or permanent resident, and have a legally registered trading entity, or be a sole proprietor. At least 50% of the business must be held by a SA citizen. You must have a business plan, demonstrate the character and capacity to repay the loan, and provide suitable credit references. You need to have a sound business plan, and, where required, provide appropriate security for the loan. Again, this is determined on a case-by-case basis.

So what makes Sefa different to a normal commercial bank?

While Sefa cannot guarantee it will fund every business, it does accept a higher level of risk than commercial banks, in the interests of developing SA’s small businesses. Sefa also provides mentorship and business support to the entrepreneurs it funds. An

adverse credit report is also not a bar to funding, provided the applicant demonstrates they are taking active steps to address their credit standing. And we focus specifically on youth-owned businesses.

Where can I find out more?

Seda’s national roadshow is still planning to visit four provinces, so watch the local media for details. They will be in Eastern Cape (EL and Motherwell) in September, Mpumalanga (Nelspruit) and Limpopo (Thohoyandou) in October, KZN (Durban and Imbali) in November and North-West (Rustenburg and Jouberton) in February 2014.

For more information and to find the address of your nearest branch, call Sefa’s national call centre on 012 748 9600 or go to www.sefa.org.za.

www.SmallBusinessConnect.co.za November 2013 - page 7

07907 Bizspark Collateral - A4 Advert_FINAL_Paths_nc.indd 1 2013/09/13 4:19 PM

Taking the GAP with benefiting from internsInterns can be a valuable resource for small businesses if the recruitment and management of the interns are dealt with effectively. MIKE JOUBERT of BrandsRock reflects on their experience witn Fetola’s GAP programme. I FIRST became acquainted with the Graduate Asset Programme (GAP) after being introduced to Catherine Wijnberg, who runs this programme with her team at Fetola.

One aspect at BrandsRock I’m passionate about is development of talent. There remains a prev-alent conundrum of experience versus opportunities. These are mostly open to people with experience, but without opportunities to gain experience, fresh talent cannot be considered. In the creative industries, talent grooming is vital. At BrandsRock we’ve addressed that by having a rolling intern programme where we continuously seek to strengthen our staff complement with qualified interns.

The benefit? They gain experience and we gain an extra pair of hands on deck.

We recently signed up to GAP. As a result, we have access to a number of qualified graduates to consider as possible interns. The programme is well engineered, with all the necessary checks and balances to ensure a good match between BrandsRock’s needs and graduates’ expectations.

What most impresses me about GAP is that the programme seeks to ensure that graduates on the scheme deliver real value to the businesses they join. The graduates are there to learn and add to their academic qualifications, and as a business we can reap the benefit of their skills and thirst for real on-the-job training. So what then are the benefits of employing graduate interns?

Interns provide great value to a small business that does not have the cash flow capability to carry high resource overheads. Interns can perform tasks that deliver against company objectives, while at the same time gaining much-needed experience.

Our experience with interns has always been positive. With a well-managed infrastructure and a clear work plan, interns excel at their work. We found the roles interns add most value to are in research, basic administration tasks, creative brainstorming and elementary project management.

We structure assignments so that there are real objectives and responsibilities against which interns are measured. Induction should include the context of their role, should communicate overall business objectives and should explain the intern’s

specific role in achieving these objectives. Regular (say, weekly) Q&A sessions can be set up to track progress and guide the intern. I believe it is important for every company in South Africa to have an internship programme because it equips

graduates with valuable on-the-job training without undue pressure on company overheads. It’s a real win-win opportunity for both parties. • For more info on Fetola’s GAP

programme, visit www.gogap.co.za. Mike Joubert, chief executive officer at BrandsRock

page 8 - November 2013 SMALL BUSINESS CONNECT

Book ReviewStart a project rather than a company

THIS is the book Jason Baptise, author of ‘The Ultralight Startup’, says he wished he had when he started as a “naive and passionate entrepreneur at the tender age of nineteen” because it would have helped him to avoid the many mistakes he made.

He says that entrepreneurs are leading in changing the world today and with the barriers in the way of starting a business being so much lower than in the past,

it is possible for entrepreneurs to get “fantastic rewards”.

The first point of advice is that you should not be misguided by the promise that formal business training offers. He says: “Everything your MBA brother told you is wrong... It’s time to free your mind.” He then explains how he learnt from experience how to go about creating a startup from nothing with little, if any, funding, limited experience and just a few

connections in the industry.New entrepreneurs who are

willing to learn will find this book invaluable, especially if you are working in the technology field,

where most of Baptise’s examples are drawn from. He is after all an American tech entrepreneur who launched both successes and failures in the process of learning what works well.

The core idea is of course tied to the title...

Do not overdesign your business before you take it to customers! It makes sense to formulate your idea and work with cofounders who offer different competencies and approaches to you so that you can take your idea to potential customers as soon as possible. Only formalise your business when you have a small team in place and are serving the needs of some customers. This is when you should look at raising money, not when you are still refining your initial idea.

The ideas in this book are based on Baptise’s own experience in starting business in the US. He launched Cloudomatic in 2010 after the failure of his first attempt. Later he co-launched Onswipe, of which he is the CEO.

The book’s promise book is that there are good ways of starting businesses without lots of money and experience. What you need is an idea that will solve a problem not being solved at the moment, but it does not have to be a very innovative or sexy idea – it must just address a problem your future customers are experiencing.

When your idea is refined, and you have the support of a small team, you set out to be better than the closest competition. You have to be better in some but not necessarily all aspects of your business.

This makes it attractive for customers to want to do business with you even if you are new and inexperienced.

The advice offered seems rather obvious, but gets straight to the point. For instance, this tip: Focus on how you will make your next dollar.

Rather obvious, but when you think about it and reflect on how easily entrepreneurs get carried away with ideas that do not contribute to financial success, you are reminded that it is the basic principles that make the biggest difference.

Baptiste says: start a project, not a company. If you think “ultralight”, your chance of launching a successful company will be that much bigger.• Christoff Oosthuysen supports

entrepreneurs as business improver and flow coach. He is also the Publisher of Small Business Connect.

011 483 1190 info@econobee.co.za www.econobee.co.za

The new codes will have an impact on your strategies that

you need to implement. Many people think that the new codes

will be more difficult to understand and implement.

We will show you that this is not necessarily the case.

EconoBEE is holding a series of full day seminars to

explain the new revised codes (refined B-BBEE Codes),

and how it impacts on your business and your B-BBEE

rating.

DetailsCourse Overview

The sooner you get to know some of

the ramifications of these new codes,

the better you will be able to plan.

A full day seminar covering the

Revised BEE Codes of 2013

Learn about the new codes;

• how they affect you

• interpretation

• implementation

• strategies, and much more.

More info : www.econobee.co.za

Booking : 011 483 1190 or

info@econobee.co.za

Location : Johannesburg

Cape Town

Durban

Cost : R2500.00 excl VAT

Other: In-house presentations available on

request to a minimum of 10 delegates.

Revised BEE codes

Jason Baptise

CHRISTOFF OOSTHUYSEN

reviews Jason Baptise’s ‘The Ultralight

Startup – Launching A Business Without Clout Or Capital’,

published by Penguin (2012).

www.SmallBusinessConnect.co.za November 2013 - page 9

Hands at work help to make deaf heardBY JACO SLABBERT

PERCEPTIONS of others are the most disabling aspect of being deaf or disabled. “That is why our focus at Deaf Hands at Work is to turn ‘disAbility’ into ‘thisAbility’,” says Charles Nyakurwa.

Nyakurwa is an entrepreneur with infectious enthusiasm for empowering the disabled and breaking stereotypes they face. Growing up in Zimbabwe with a deaf brother, Nyakurwa experienced the challenges of less ablebodied individuals first-hand.

“My brother Peter was always way smarter than me, but everyone could understand me,” he explains.

Statistics show that less than 1% of the South African workforce is disabled, and close to 75% of the deaf community is illiterate, but Nyakurwa is working hard to change the situation. In 2007, Nyakurwa came to South Africa to escape the political situation in Zimbabwe. A keen student, he worked as a waiter to put himself through vocational training. While achieving his degree, he was concerned with the lack of opportunities for the disabled.

“I wanted to help, because I could see how difficult it was. I wanted to start a non-profit organisation to help them, but I didn’t want to create dependence

through handouts,” he says.Nyakurwa knew that

employment meant empowerment and that he could achieve a lot more than just sustenance through grants. This came to him when, in 2010, he received a text message that his brother had been accepted to college.

“I was happy, but I also

wondered where my brother would work once he was finished,” he says.

Thinking about a way to combine empowering the deaf with changing ablebodied perceptions, Nyakurwa founded Deaf Hands at Work (DHW).

“DHW’s vision is to empower by creating meaningful employment

for disabled tradesmen,” explains Nyakurwa, “but we are also teaching sign language and breaking down stereotypes that disabled people aren’t smart.”

With his personal savings, he was able to get together the basic tools needed for his venture, but unfortunately three months in there was a major fire and he lost almost everything. Not one to give up, Nyakurwa pushed forward, buying tools as he could.

“Then a friend told me about Unltd South Africa,” he says. “I needed some help and I thought I would take the chance with their competition.”

The chance paid off, and Deaf Hands at Work was selected as the winner of the Unltd South Africa Award. Every year, Unltd South Africa gives awards to deserving social entrepreneurs that really need help kickstarting their ventures.

“With the money I won, we could buy many of our needed tools, but the award was about much more than that to me. The amount of professional support and personal growth was amazing,” says Nyakurwa.

Besides the cash prize, winners are plugged into a community of like-minded entrepreneurs in peer groups.

“If you’re pioneering a new area, it helps to be part of a

community,” he continues, “that’s what gets you through the tough times.”

In addition, Unltd South Africa also looks at the nuts and bolts of the business to help make it successful.

Tom Schutte, Programme Director at Unltd South Africa, says they were very impressed with the vision for DHW, and could see where they could help to make it a success.

“When we met Nyakurwa, he needed more than just cash,” says Schutte. “We realised there were many areas of the business that needed work. Things like financial management systems were necessary. That’s when we partnered him with Ernst & Young to help put the right processes in place.”

Nyakurwa also doesn’t like to sit still. Last year he walked a 200 km Deaf Silent Walk, where he communicated only in Sign Language in order to raise awareness of the issue.

He is also working on a variety of ways to empower other deaf entrepreneurs to create their own ventures, and even building a township-based skills training centre, for which he is currently running an IndieGoGo fundraising campaign. • For more information, visit

www.dhwsa.co.za.

Charles Nyakurwa turns “disAbility” into “thisAbility”

Branson centre supports entrepreneurs with growthBY NABELAH FREDERICKS

A JOHANNESBURG business owner says that since receiving mentorship and training by the Branson Centre of Entre-preneurship five months ago, he has already seen an increase in productivity resulting in a 20% growth in his software development business.

The centre, which is an initiative of the Virgin Group owned by entrepreneur extraodinaire Sir Richard Branson, started off four years ago as a school but has morphed into an entrepreneurial centre over the past two years.

It seeks to assist existing entrepreneurs with training, mentorship, computer facilities and networking opportunities.

According to its chief entrepreneurial officer, Tracey Webster, some 514 business owners have already been assisted by the centre since inception.

“We focus on existing entrepreneurs who want to expand or need hands-on training or mentorship, or we try to assist by brokering funding for them because we do not provide funding,” says Webster.

This is exactly the reason that sent Tsoanelo Modise, owner of IntDev CRM, in the direction of the centre to seek business advice and mentorship.

“I was stuck in my business. I had run out of know-how. I then

drove past the Branson Centre of Entrepreneurship and went onto their website because I had heard about it before,” says Modise.

He then applied online for assistance, was called in for an interview and was accepted as a Branson Centre Entrepreneur.

Webster says once entrepreneurs are accepted as part of the centre’s training programme, they also have access to the 14 computers at the Johannesburg-based centre;

this includes internet and printer facilities as well as meeting rooms.

“There are certain criteria which must be met before being accepted as a Branson Centre Entrepreneur. The business will must be an existing business, must be registered and must be operational, since we are not an incubator,” says Webster.

Two different training programmes are offered by the centre. The first training programme, the foundation course, which has a duration of six weeks, focuses on business basics such as strategy, marketing and communications and understanding cost and financials.

“Once these have been completed, business owners have to do a-minute-to-spin-it ,which is basically a one minute pitch focusing on selling your business,” says Webster.

The trainees then go away for a month to develop a business plan by using what they have learnt. This business plan can then be used to access sometimes much-needed finance.

The advanced course is aimed at business owners who want to grow and expand their businesses and who ideally have already developed their business plans.

This course, which is made up of two half-day classes for 12 weeks, focuses on four themes: to create, communicate, deliver and realise the the value of

the business. Business owners receive

training on innovation, understanding operations, business ethics and social media.

“Not all businesses will move from the foundation course to the advanced course immediately as every business is in a different stage. Some are not ready for the advanced course,” says Webster.

On completion of the 12-week course, business owners do a pitch named after Branson’s famous quote and autobiography “Screw it, let’s do it”.

During this pitch, they have 15 minutes to impress captains of industry, who are invited to listen to and choose the top six business owners.

These six business owners are then each assigned a mentor for six months to provide ongoing business support and advice.

Webster says all this takes place at no cost and that the centre’s overhead costs are covered by the Virgin Group, but that additional activities require fundraising.

She says they would like to replicate the centre’s business model by opening more branches throughout the rest of the country so that they can assist more business owners, but that they require funding from corporate partners to do so.• For more information, visit

www.bransoncentre .o rg /SouthAfrica/home.html.

Tsoanelo Modise

National network connects social entrepreneurs

THE African Social Entrepreneurs Network (Asen) is a growing community of social entrepreneurs and people who are passionate about addressing social and environmental challenges.

The inspiring models and innovations by Asen members (such as reported above) offer new ways of doing business with a positive social impact.

Asen helps social entrepreneurs connect with others, share useful resources and meet up at events. They also keep them updated on the latest developments and assist in finding access to information on funding.

Through Asen events and its online platform, members have access to the latest tools, resources, training, information and news.• For more information, visit

www.asennetwork.org.

page 10 - November 2013 SMALL BUSINESS CONNECT

Achieving success ‘one meal at a time’BY NABELAH FREDERICKS

SINCE joining the Department of Trade and Industry’s (DTI) trade missions, a family-owned business has managed to globalise its business and is now exporting to 23 countries.

Tammy Fry Kelly, international marketing director of the Fry Food Group, and daughter of founders Wally and Debbie Fry, says her parents started the business in 1991.

“My parents owned a successful construction business and my dad built a piggery for one of his clients. One day he visited the piggery and on seeing all of the pigs being slaughtered, vowed never to eat meat again,” says Fry Kelly.

Wally and Debbie, who has been a vegan since birth, then realised there were no meat alternatives on the market and not many food options to choose from. This then led them to experiment with different recipes so that they could find something suitable for their family’s consumption.

“They tried new recipes for vegan burgers for two to three years and eventually developed something really tasty,” says Fry Kelly. The recipe was never meant to be used for commercial purposes, but one day a friend of the family approached Pick n Pay

with the recipe and the family were given a national listing on the same day.

“We did not have a brand, packaging or a name and when someone asked Wally what the name was, he responded by saying Fry’s Special,” says Fry Kelly.

The business name has subsequently changed to Fry Group Foods. Since then, Fry Group Foods’ products are stocked in all the mainstream retailers

such as Checkers, Woolworths, Spar as well as independent stores.

Fry Kelly says, when looking for partners, agents and distributors, the family usually look for like-minded people who share the same values.

“Our partners in the UK are a family of vegans who share our beliefs and values,” says Fry Kelly.

She says the Fry Group first became involved with the DTI’s trade mission to Anuga in 2001,

and the business took off after that.Fry says she believes that the

reason for the business’ success is that the whole family comes to work every day, not to make money, but because they love what they do and that there is a purpose behind that.

All three daughters and two of the daughters’ husbands work in the business. However, Fry Kelly says there is no nepotism and each family member has had to earn

their stripes.“My husband started as a

cleaner and had to work hard to get where he is now because we don’t take anything for granted,” says Fry Kelly. He now serves as director of systems and compliance.

Their plans for the future? “Making the world a better place, one veggie meal at a time,” responds Fry Kelly, quoting the business’ slogan.

Watch out for unscrupulous franchisorsTHE single biggest way for franchisees to protect themselves against unfair practices by un-scrupulous franchisors is to seek legal advice before signing any agreement. So says franchise attorney, Esmari Jonker, of SWV Inc.

“Franchisees are willing to pay R500 000 or more for a business, but they do not want to spend a couple of thousand rand to seek legal advice,” says Jonker.

The unwillingness to spend on legal fees could cause a franchisee to end up in a legal battle that could cost him or her R100 000 or more and which could take up to a year or two to resolve.

A common spin-off of the lack of legal advice sought, according to Jonker, is that franchisees subsequently realise that they are responsible for all kinds of costs in addition to the royalties that they are required to pay to the franchisor.

Or, in other cases, franchisees discover that there are certain restrictions that have been placed on them and that they are only able to source products from the franchisor directly or from one of the franchisor’s suppliers, despite being able to buy the goods at a fraction of the cost from a different supplier.

“These examples are all a result of the agreement not specifying anything, but instead providing only high-level wording,” says Jonker.

For example, where a franchisee has to pay additional costs, it is important that the franchisee requests the exact rand amount to be disclosed by the franchisor, so that the franchisee knows exactly what additional fees need to be paid each month.

Jonker says franchisees also need to ascertain that where a franchisor commits to something, the agreement stipulates exactly what the franchisor promises, to ensure that the franchisor delivers on those promises.

“It is also important for franchisees to be aware of their rights as per the Consumer Protection Act (CPA),” says Jonker.

The CPA covers franchisees by allowing them to cancel an agreement within 10 business days after entering into it with the franchisor. The CPA further requires that a disclosure document be issued by the franchisor prior to entering into an agreement with a franchisee.

A disclosure agreement needs to contain certain important information such as the franchisor’s financials and number of outlets as well as be accompanied by supporting documents from the franchisor’s accountant or auditors, a list of existing franchisees, key business information and an organogram that depicts the support system for franchisees.

Should a franchisee discover that the franchisor has

contravened the CPA, a complaint can be lodged with the National Consumer Commission.

However, Jonker says this is not always helpful to a franchisee.

“Lodging a complaint can take up to several months and in the end might only result in a notice being issued against the franchisor.

The franchisee will then still have to go to court to try to resolve the matter, which could cost between R100 000 to R200 000 in legal fees,” says Jonker.

She says she believes franchisees sign agreements in such haste because they are sometimes desperate and afraid to lose the deal.

“Some, not all, franchisors tell franchisees that if they don’t sign quickly, the business will go to another franchisee,” says Jonker.

She says unfair practises are to be found in every sector and it was difficult to single out any specific industry.

However, she emphasised that not all franchisors are bad and that good research, and speaking to existing franchisees prior to entering into any franchise agreement, would assist in determining whether a franchisor looks after the interests of its franchisees.

“Reasonable and experienced franchisors who take the interest of the franchisees to heart, is the cornerstone of a successful franchise business,” says Jonker.

Seda helps first black lab increase output by 100%

BY DANIEL BUGAN

A BLACK-OWNED laboratory that provides testing services for clients in the water resources industry increased its analysis output by 100%, thanks to an intervention by the Small Enterprise Development Agency (Seda).

Seda assisted the laboratory, Mpumamanzi Laboratory Ser-vice, to secure a Technology Transfer Fund incentive for new equipment to increase the laboratory’s daily sample testing capacity and efficiency and to comply with the National Laboratory Association’s annual proficiency performance test.

As a result, the laboratory improved its analysis output from an average of 40 to 80 microbiological samples daily and increased its sample testing capacity to at least 200 per day.

Thusi Motsepe, owner of Mpumamanzi Laboratory Service, says: “Our growth can be linked directly to Seda’s interventions, which improved business quality and efficiency, and impressed our clients. With Seda’s support we will be the first wholly black-owned and managed laboratory, which shows that the African dream is a reality – through persistent and diligent work.”

Seda’s support has also

helped the company to: grow from 7 employees in 2010 to 15 at the end of 2012, with the addition mainly of professionals (environmental scientist, chemical engineer, analytical chemist, microbiologist), to achieve a 100% compliance score from the National Laboratory Association for its proficiency performance, to achieve accreditation to secure tenders in the mining and municipal sectors, and to increase its client base. Nonhlanhla Ngomane, another business owner who received assistance from Seda, faced challenges to grow a herb farming business that provides clients with fresh herbs and baby vegetables.

These challenges included access to funding, systems to address production and supply chain-related problems, SABS accreditation to attract clients, equipment to improve efficiency, and mentorship in crop management.Seda incubated the business in the amaSpice production cluster of the Seda-supported Timbali Technology Incubator. The incubator identified a gap in the market to supply baby vegetables and herbs to Woolworths through Fresh-to-Go (FTG), who was importing herbs from Kenya.

The Fry family: Shaun Richardson, Hayley Fry Richardson, Stacey Fry, Debbie Fry, Wally Fry, Tammy Fry Kelly and Richard Kelly

www.SmallBusinessConnect.co.za November 2013 - page 11

Take care with hearings if on sick leaveBY BARNEY JORDAAN

YOU can discipline an employee who is on sick leave but if the employee’s illness is genuine, failing to postpone the hearing will probably be regarded as procedurally unfair.

Illness can be regarded as genuine if the employee presents a certificate from a registered medical practitioner stating that according to the assessment, the employee was too ill or injured to work for the period of absence. The certificate must be signed and indicate the visit’s date and time.

In these circumstances, it is advisable to postpone the hearing until after the return date indicated on the certificate, but state in the notice that further delays won’t be allowed and that the hearing might continue in the employee’s absence if s/he fails to appear.

Here is an example of a paragraph that may be included in the notice: “Please note that the hearing will continue in your absence if you fail to attend. In the event of you being unable to attend because of alleged illness, you must inform your manager prior to the date of the hearing of this and explain the full circumstances. We reserve the right to continue with the hearing if we believe that your absence is merely an attempt to avoid the hearing. If we do allow a postponement, you must upon your return provide a full medical report from a registered medical practitioner (not from a nurse, traditional healer or clinic) stating that the doctor had been informed of the fact that you have to attend a hearing but that you are, in the doctor’s own opinion, too sick to attend.”

Should s/he again be absent, again supported by a certificate, use your discretion as to whether or not to allow a further postponement, depending on whether you believe the illness is genuine. If you have reason to believe that the employee is abusing sick leave – for instance as it appears from the employee’s attendance record, or the employee’s failure to provide a legitimate medical certificate – you may either continue with the hearing in the employee’s absence or allow at least one final postponement. One more postponement is probably advisable.

It might be there are reasons why you cannot delay the hearing any longer, for instance because the hearing’s outcome is important to minimise risk, or to be able to take action against others involved. In this event, we advise that you record the evidence and provide a printed copy to the employee and require a written response by a given date.

Consider the evidence in the light of the response and then decide on the employee’s guilt or innocence concerning the original allegations. If guilty, allow the employee an opportunity to provide

mitigating factors in writing. You should also inform the employee of his or her right to appeal the

decision, if your organisation provides an opportunity to appeal.

An example is the case of Solidarity on behalf of Van Vuuren versus Volkswagen. The employee did not have an opportunity to present evidence in mitigation after having been found guilty of serious misconduct, as she was allegedly sick at the time.

It was held that, in the case’s circumstances, it was probable that the employee used her alleged illness merely to avoid attending the remainder of the

hearing. The employer was found to have been very accommodating to the employee in attempting to obtain mitigating factors from her, but had reached the point where it could not reasonable be expected to wait any longer. The commissioner was also satisfied that even without having the employee’s mitigating factors available to consider, its decision to terminate the employee’s services was substantively fair.

In summary, we advise that employers err on the side of

caution and postpone at least once if the employee claims to be too ill to attend. If you have evidence supporting your belief that sick leave is being abused, however, you may be able to continue in the employee’s absence.

We advise that you inform the employee in writing about the reasons why you continued in absence and allow an opportunity to convince you that the absence was not deliberate.• For more advice, go to www.

labourwise.co.za.

SMME DEVELOPMENT INCENTIVES

Government has prioritised entrepreneurship and the advancement of Small, Medium and Micro Enterprises (SMMEs) as the catalyst to achieving economic growth and development. The Department of Trade and Industry (the dti) plays a key role in implementing SMME-related policies and providing adequate fi nancial and non-fi nancial assistance to ensure sustainability.

the dti offers the following incentives to support and grow the SMME sector: Co-operatives Incentive Scheme• A 90:10 cost-sharing grant for enterprises incorporated and registered in South Africa in terms of the Co-operatives Act of 2005.

◊ Maximum grant of R350 000.

Black Business Supplier Development Programme• A cost-sharing grant for small enterprises with a 51% majority black shareholding, in operation for at least a year and have an annual turnover of

R250 000 to R35 million.

◊ R800 000 for tools, machinery and equipment on a 50:50 cost-sharing basis; and R200 000 for business development and training interventions

per eligible enterprise to improve their corporate governance, management, marketing, productivity and the use of modern technology on a

80:20 cost-sharing basis.

Bavumile• Targets rural women entrepreneurs with basic skills in sewing, with the aim of improving the quality of cultural products and ensuring their

commercial viability.

◊ Training and equipment.

Enterprise Investment Programme (EIP) – Tourism Support Programme• A reimbursable cash grant for investors in new and expanding projects in the South African tourism industry.

◊ Investment grants of 30% of the investment cost of qualifying assets for new or expansion projects below R5 million; and investment grants

of between 15% to 30% of the investment cost of qualifying assets for new or expansion projects above R5 million. Qualifying assets include

furniture, equipment, buildings and tourism vehicles for new establishments or expansions.

Export Marketing and Investment Assistance Scheme (EMIA) • Assists South African export trading houses that represent at least three SMMEs or businesses owned by historically disadvantaged individuals to

showcase local products at international exhibitions.

◊ the dti bears costs for space rental, the construction and maintenance of stands, electricity and water charges, as well as freight charges up to a

maximum of three cubic metres or two tonnes per exhibitor.

Support Programme for Industrial Innovation (SPII)• Promotes technology development in South Africa’s industry, through the provision of fi nancial assistance for the development of innovative products

and/or processes. Production must take place in and intellectual property must reside in South Africa.

1. Product process development scheme: Maximum grant of R1 million;

2. Matching scheme: Maximum grant of R3 million; or

3. Partnership scheme: Maximum contribution of R3 million.

Technology and Human Resources for Industry Programme (THRIP)• Supports science, engineering and technology research collaborations, which address the technology needs of participating fi rms and encourage the

development and mobility of research personnel and students.

◊ Projects are funded per the following ratios: R1:R3, R1:R2, R1:R1 or R2:R1, depending on the company’s size as defi ned by the National Small

Business Act, 1996 (Act No.102 of 1996).

For more information on the above incentives, visit www.thedti.gov.za ● Customer Contact Centre: 0861 843 384

empowering industries and broadening economic participation

Barney Jordaan from Labourwise

page 12 - November 2013 SMALL BUSINESS CONNECT

Mentor is needed to help with logistics businessSmall Business Connect offers business owners the opportunity to connect with mentors via the Mentor Connect Feature.

Wahlied Cole of ISCI (Pty) Ltd writes:

ISCI is a logistics business. We focus on three elements of business. We do imports and exports, and we are a registered clearing and forwarding agent. We also do warehousing and last-mile distribution.

We are situated in Ndabeni, Pinelands, Cape Town and we are trading at approximately R3 million per year at present.

ISCI has found a steady customer base in clearing, forwarding and distribution. We have a system called Univu that helps clients get the cheapest costs and best services through multiple courier vendors in the market.

We have six couriers loaded and want to make this the widest platform for courier aggregation in South Africa.

At present we only have one competitor – a startup.

ISCI has a high conversion rate of customers seen to customers signed up – more than 70%.

However, we are struggling to market our products and services through cold calling alone.

We have done a bit of networking and this also helps.

Univu is a mass market B2B product and we therefore need the ability to sell better and position our products and services better.

We would welcome support in the marketing aspect as well as how to get access to people who want to be trained in logistics, which could reduce our costs of staff.

You can contact Wahlied at wahlied@isci.co.za.

CONSTRUCTION COMPANY

Mapule Virginia Sithole writes:

My business’ name is Phethedi Projects – an upcoming construction company owned by black people, looking for a mentor in the following areas: • marketing strategy• management functions• costing and pricing• finance management and• business administration.

You can contact her at virginiamsithole@gmail.com

SEND YOUR DETAILS

Are you looking for a mentor to give you business advice and guidance? Or are you a mentor who is available to support small business owners in your area?

Mentor Connect is a regular Small Business Connect feature to link mentors and small business owners.

Every month we feature a selection of mentors and entrepreneurs who are seeking or offering voluntary or paid mentorship. From that point on, it’s up to you to follow up with the mentor or entrepreneur directly.

If you would like to be featured in Mentor Connect, please email the following to info@SmallBusinessConnect.co.za:• Clear photograph of yourself

(1 MB to 2 MB in size).• First name, surname, business

name and email address.• If you are a mentor, a short

description of your services, and what area you service.

• If you are looking for a mentor, a short outline of what kind of support you are looking for, the size of your business and where you are located.

Please note that by submitting your details to Mentor Connect, you give us permission to publish your photograph and the details you have supplied. We reserve the right to select only appropriate submissions for publication.

A business owner may get great benefits from using a mentor in making decisions based on information and knowledge that would otherwise not be available and in staying accountable to the bigger objectives of the business. Business owners who use mentors to help them make good decisions generally say that at key points in the growth of their business, the support from their mentor proved to be invaluable.

How to start a...

Hair salon businessBY PAUL CRANKSHAW

SO you’ve got a flair for hair-dressing, and you’ve got some training and experience? Great start, but now what?

Here are some ideas for going out on your own – without becoming one of those failed business statistics.

As you will know by now, there is no shortage of hairdressers in South Africa. It’s a tough market to break into, but you can do it if you are focused and careful about it.

Whatever you do, don’t rush into spending money on premises and equipment before you’ve thought hard and planned ahead.

Start by looking at yourself: are you the right kind of person for this work? Are you friendly and interested in people, while at the same time being professional with your service? Your customers are likely to be from various age groups and social backgrounds.

You must be able to communicate with all of them and adapt your approach to best suit their individual needs. Are you fit and healthy? You will need plenty of stamina to work long hours on your feet every day, while keeping a smile on your face.

Do you really, really love hair? You should be interested not just the latest hairstyles and hairdressing techniques, but also fashion trends generally – as this all goes together to improve your customer’s ‘look’.

You also should be a regular reader of magazines such as the South African Hairdressers Journal, Image and Hair and Beauty Africa.

Does your personal appearance show how interested you are in your field of work? You will always need to be well groomed, with a high standard of personal hygiene, as you will be ‘up close and personal’ with your customers!

YOUR CUSTOMERS

Now you need to think about your target market. More than 10 million South African adults visit a hair salon at least once a month, and two-thirds of these are women. About 75% of people going to a salon are black, so there is much more demand for afro salons. Try and focus on a certain niche market – a smaller segment of the total market – to whom you think you can offer something special. This will help you compete, and will affect where you set up premises, the prices you charge and the range of specialist services you offer.

Professional women are going to make up a large portion of your

client base. These women earn their own money and can spend a substantial amount on personal care, clothes and cosmetics. They are also quite busy and so often do not have time to come in to a salon for a couple of hours to have their hair done.

You could offer after-hours appointments for these women or offer services such as express cut and blow-drying treatments during their lunch hours.

There is a demand for hairdressers qualified in braiding, relaxing and straightening. You may want to open a salon that specialises in this market only or may include it in the services that you offer.

These days, men are taking more of an interest in body image and grooming. Many barbers have taken notice of this trend and are offering a variety of male grooming services such as shaving and manicures.

If you run a unisex salon, you will be able to reach the profitable market of young professional males as well as your traditional female base.

Children and teenagers will also be other potential customer groups for you. Most young girls and teenagers are aware of their personal image and want to keep up to date with the latest styles and trends.

You may want to offer special rates or packages for this younger market since it may encourage parents to bring children to you instead of a salon that charges the same rate as adults.

Brides, their mothers and their bridesmaids all need to have their hair styled on the wedding day, so you could offer early morning

appointments and special rates to these bridal parties.

Some hairdressers offer additional services such as Indian head massages and beauty therapies such as manicures.

Your clients can have these treatments done while they wait.• Paul Crankshaw is from

Cobweb Information. For more information on starting a business in various industries, go to www.cobwedinfo.co.za.

onnectMentor

Getting trained and qualifiedYOU need to do theoretical and practical training before you can become a qualified hairdresser. Courses include the National Certificate in Hairdressing NQF Level 2, the National Certificate in Hairdressing NQF Level 3, and the Further Education and Training Certificate in Hairdressing NQF Level 4.

Once you have completed a qualification, you need to do practical training as an apprentice, under the supervision of a qualified hairdresser. After that, you can do a Theory Board Examination and a compulsory trade test set by the Department of Labour.

No person under the age of 21 can be employed in a salon without having applied for a learnership or apprenticeship.

A useful website to visit is www.sahair.co.za for more information on workshops and training programmes.

Mabuti Beyi of African Ladies Hair Salon Photo: Chelsea MacLachlan, Grocott’s Mail

onnectStartout

Wahlied Cole

www.SmallBusinessConnect.co.za November 2013 - page 13

See things differently to find great ideasHow do great business ideas come about? CHARLES MAISEL reflects on his experiences in coming up with innovative ideas. His advice? Look at ordinary things differently.

OFTEN the solution to a problem is staring us in the face without being noticed. It just needs to be seen! The innovative idea is already there; you must just notice it.

Take the local wine farmer who once asked me for advice.

He did not want to lay off his workers in the non-picking season, but he couldn’t afford to keep a full workforce on salary unless he could find something constructive and profitable for them to do.

We sat on his balcony, drinking his award-winning wine, and I looked out over his vineyards.

The longer we sat and chatted, the more I looked. And then I saw. It’s hard to explain the feeling when this sort of “seeing” happens. It’s a sudden excitement as the meaning of what I am seeing flashes into place and I realise I have hit on a great idea, a

different way of seeing that turns a problem into an exciting and achievable proposition.

“Look!” I said. “Your vineyards!”

The farmer looked baffled. I forced myself to slow down. I took a deep breath. “What do you do with your vine leaves,” I asked the farmer. “Nothing,” he replied. “Why?”

So I told him about dolmades – mouthwatering parcels of vine leaves stuffed with a variety of fillings. The farmer’s eyes widened as I told him how dolmades can be served, what a great snack they make, how the leaves can be used fresh, pickled or vacuum-sealed.

The result? One very happy farmer!

The idea that creative people are born is simply not true. Soccer players may be gifted, but the coaching they receive makes them great players. This is the same for artists and musicians.

The people who practice the hardest and longest are the people who make it!

You can also learn to look differently. You can train yourself to come up with great ideas.

With practice, you will find new ideas all the time.

With practice, you will learn to identify what is truly innovative and truly possible. See the extraordinary behind the ordinary. See the brilliant idea that can be translated into reality.

You can also master the techniques and develop your own way of seeing differently.

Get out there, into the world, on a daily basis.

Expose yourself to what is going on around you. And be aware that you are looking.

Look at a situation from every angle. Listen to the feeling that tells you there is something more.

Keep looking, flipping things around. See the leaves. See things differently...

Innovation is about developing your perception so that you see what is already clearly there.

Perhaps you are ready to look at things differently. Your mind is open and you want to begin

practicing innovation. Here is the best advice of

all... Read the newspaper! You don’t need to do anything more. Newspapers are a golden chalice for new ideas. Signs and signals are around us all the time and you often find them in your daily newspaper.

My next best advice is to be focused on just the next step. You’ve had a great idea and now you’re thinking about new angles. But, if you’ve started thinking about a 100-page business plan, stop!

Don’t spend hours of time planning only to see your dreams crumble into dust.

Get out there into the streets and try a simple pilot. Prove, faster and more efficiently than any business plan will ever do, that this is an idea that will fly.

Don’t limit yourself. If you’ve been practicing your seeing, you could be piloting three great ideas, with plans for piloting three more taking shape.

When I had the idea about lavender for Lavender Hill, I didn’t spend hours calculating the costs of lavender oils and what it would cost to start a plant to process the product. What happened there was that I heard the word “lavender”, connected it to the idea of the plant and then thought about how beautiful it would look to see a housing project surrounded by the beauty and smell of lavender, a hardy bush that thrives in hot, sandy conditions.

And then I took one step and one step only. I sent out an email to all the people on my email contact list and waited. It didn’t take long. Within a couple of hours, my inbox was flooded with enthusiastic replies and so I could see that this was an idea that would fly.

If bigger and better things happen as a result of my initial idea, great. If someone else takes an aspect of the scheme and makes something of it, so much the better. My job – for want of a better word – is to think creatively, to see the leaves. And in this instance, the only question

I asked, after years of training myself to think and see creatively was: “How much lavender is there in Lavender Hill?”

Another idea worth mentioning is the stickfighting business. We tested the market immediately. We organised one small tournament and waited to see what would happen.

People couldn’t stop talking about it and were soon clamouring for more. Urban Stick Fighting took off like a rocket and within two months had made international news.

Two ideas; two quick, effective and inexpensive pilots.

No major investments – not emotionally, financially or in terms of time.

If the idea flies, it flies. If it crashes and burns, the

fallout is minor and we haven’t been sucked in, bogged down and shackled by planning for something that may never actually happen.

We’ve tried our great idea out and the response we’ve received has shown us that it will either nosedive or fly for miles.

Remember the farmer. The leaves on the vine were hanging there, waiting to be seen. He just had to see them!

The same with the stickfighting example in the picture... stickfighting was there, but just had to be seen as an innovative business opportunity.

An angry crowd chanting, toyi-toying, waving sticks and placards. What caption would you write?

Perhaps this, in a report in a leading newspaper: “Protesters from Madelakufa informal settlement in Thembisa congregate outside the Ekurhuleni Metro-politan Municipality demanding housing which was allegedly promised by President Zuma.”

Vuyisile Dyolotana, a young black entrepreneur, saw something in the same picture, but he was looking at something else.

He saw the sticks, and an idea began to grow.

Why not start stickfighting tournaments? That’s all it took – looking at a picture in a newspaper and seeing it differently. From this came the idea for The Stick Fighting Company.• Charles Maisel reads up to ten

newspapers a day to find new business ideas. At Innovation Shack, he develops innovative and social businesses into commercial ventures. He has personally started more than 24 businesses.

9 reasons to read papers• Newspapers write about what

is happening today. The stories in newspapers record details of the lives we lead right now.

• Newspapers tell stories, many of which highlight something that is lacking or not working. These are opportunities. Train yourself to see them.

• Journalists write about what is. They don’t suggest what might be. It is up to the entrepreneurs and innovators to see behind the story, to find creative solutions, or see the possibilities and opportunities.

• A variety of headlines, stories, pictures and adverts offer opportunities for ideas about social change, commercial enterprises and intellectual exploration.

• Newspapers are printed daily. You are not limited to print and can acess online editions too.

• You can read a newspaper anywhere, anytime.

• Newspapers are timeless. You can go back into the archives of any newspaper and see what people were doing, saying and buying more than 50 years ago.

• You are not limited to one newspaper. You have the choice of several daily, weekly and community newspapers and classified adverts. If you’re unable to access hardcopies you can also read the news online

• You can read international n e w s p a p e r s . T h i s broadens your horizons and alerts you to overseas trends.

Tips to turn your ideas into realityIf you have an idea, I can offer you my advice summarised in a few short points:• There are no rules to what

type of business you could start – look for the idea you see which others are missing.

• There are less rules and more freedom to experiment in the townships so start there .

• Don’t register a business unless you have to. First see if you can sell before you choose to register. Compliance should come after you proved your idea as viable.

• Don’t employ people with contracts when you start. Rather get people who want to be involved with you. You can employ people later when the business is proven to be viable.

• Get paid upfront for goods or on the first of the month rather than the end of the month.

• Don’t borrow from banks or try to from other financial institutions. Rather try and borrow from family and friends.

• You are likely to break as many rules as possible but they need to be legal.

Charles Maisel What business opportunity do you see in this picture? One entrepreneur was inspired to start an urban stickfighting business when he read about protesters form Madelakufa informal settlement. Photo: The Star

page 14 - November 2013 ADVERTISING FEATURE SMALL BUSINESS CONNECT

Seda launches green hub in Atlantis“FROM unemployment to self-employment.”

This is how Trevor Stander, an Atlantis business owner who is in the process of securing his biggest contract, describes the change to his circumstances after being assisted through the Seda Atlantis Renewable Energy Business Incubator (Sarebi) New Venture Creation (NVC) Development Programme.

The NVC programme was introduced to provide local communities with an opportunity to develop their business knowledge and acumen to take up opportunities within the renewable energy, energy efficiency and energy saving sector. As part of the program, Stander had to transform his idea into a viable business opportunity in the renewable energy sector.

According to the centre manager at the recently launched Sarebi, Nafeesa Dinie, the Atlantis-based non-profit company is a hybrid model of incubation that aims to support the startup and growth of businesses in the renewable energy, energy efficiency and energy saving sector.

“We aim to design, develop and implement customised programmes based on the demands of the incubator clients, that is, business owners in the sector, as well as the demands of industry players and markets, to ensure that entrepreneurs are developed to take up opportunities in the sector,” says Dinie.

Stander, who owns TS LED Lighting Solutions, says he first saw an advertisement in a newspaper last year calling for local communities to

apply for participation in a customised development programme geared at developing local small businesses in the renewable energy sector.

This was run in partnership with the Small Enterprise Development Agency (Seda), Sarebi and the local West Coast FET College. Seda forms part of the Department of Economic Development and Tourism’s partner network.

He applied but assumed that at the age of 52, he would be too old for the programme.

Just over a year later, Stander received his certificate of programme completion after successfully completing the early stage development programme theory, idea generation and scoping, practical application and experiential components of the program over a period of 12 months.

He applied and was accepted into the program, where he was introduced to a Sarebi partner that manufactures LED lights. He then decided to outsource and sell LED lights.

“I registered my business and am awaiting the registration documents but already have seven clients since starting my business in August,” says Stander.

Since starting the programme, Stander is now computer literate and says he has acquired sector knowledge and business intelligence, has developed business skills and is being mentored and coached by the incubator staff in running his business and securing and growing his client base by profiling himself in the sector. Once his three-year incubation period is

over, he plans to move into his own business premises and employ more staff. “I am contracting an electrician now, but I plan to employ two more people as the business grows,” says Stander.

Dinie says the intention of the Western Cape Provincial Government is to develop Atlantis into the Green Hub for the Western Cape.Sarebi offers a range of programs, products and services that provides aspiring, emerging

and existing businesses in the sector with resources such as office space, shared administrative and operating resources, sector knowledge and information, access to coaches and mentors, technical expertise, assistance in business feasibility and planning, access to business networking opportunities, and access to markets, funding partners, technology and innovation development programmes.

“Incubation allows for the

reduction of startup costs in the early stage of business startup and allows the business owner to focus on their core business and to secure markets while receiving operational support, technical expertise and hand-held coaching and mentoring to grow into self-sustainable enterprises, therefore increasing their survival rate,” says Dinie. • For more information, call 021

577 2719 or email info@sarebi.co.za.

Youth enterprise conference sparks social media buzzTWITTER was abuzz with updates from inspired young entrepreneurs attending the Youth Entrepreneurship Conference 2013- an indication of the event’s overall impact.

Held at the Cape Town International Convention Centre, the event was aimed at student entrepreneurs, aspiring student entrepreneurs and entrepreneurial societies, and is an initiative of the Western Cape Department Economic Development and Tourism, which focuses on encouraging a culture of entrepreneurship in the Western Cape. This is also in line with the province’s strategic objectives of growing the economy and creating jobs.

The conference was all about unleashing ideas, spotting opportunities, taking risks, solving problems, being creative, building connections and learning from both failures and success.

This seemed to have been achieved, judging from the tweets during and after the conference.

This year’s theme was centred around innovation. Apt to have as a speaker the award-winning business owner Ludwick Marishane, who developed a gel that can be used

to have a waterless bath. Other speakers included the Minister of Economic Development and Tourism, Alan Winde, Alex Mcleod of the School of Entrepreneurship Trust, and MC for the event Sibusiso Mbonambi, founder of Shayela.com.

Tweets @ YEC2013Aspiring entrepreneur Bianca Blohm tweeted, “Thank you @ YEConnect @investsoc @WesternCapeGov for an amazing experience at #YEC2013. Met incredible people and learnt so much!”

“Today was such an interesting day. Met a lot of young entrepreneurs and Ideas were exchanged. Progress. #YEConnect”, tweeted @ShinanaG.

A tweet from Samson Mbewe read, “#YEConnect. Indeed, great minds don’t think alike. A lot learnt today; visions are clearer.”

Speaker Sibusiso Mbonambi, entrepreneur and founder of Shayela.com, tweeted “Thoroughly enjoying #YEC2013. The people are great and so inspired by the pitch session.”

Another attendee, Tom Burke tweeted, “Just spent 12 hours in the company of the greatest young entrepreneurs in South Africa! Feeling priviledged and inspired! #YEC @YEConnect”.

Sibusiso Mbonambi of Shayela.com was a speaker at the Youth Entrepreneurship Conference 2013.

Pictured here are Sheryl Smith (Integrated Business Solutions Director), Lwazi Welem (NVC student),Trevor Stander (NVC student), Arlene Rodgers (West Coast College Campus Manager), Gerschwin Williams (Sarebi Board Chairperson), James Titus Henry (NVC student), Nafeesa Dinie (Sarebi Centre Manager), Michael Marote (NVC student) and Michael Fourie (SEDA Atlantis Business Advisor).

Making business in the Western Cape better together

www.SmallBusinessConnect.co.za ADVERTISING FEATURE November 2013 - page 15

Fund helps with Cape job creation“WE did not have money, but we had an idea.”

These were the words of Cape Town business owner Luvuyo Rani, speaking at the launch of the Western Cape Department of Economic Development and Tourism’s Enterprise Development Fund (EDF), held at his business premises in Khayelitsha.

Rani, who started the information technology business Silulo Ulutho Technologies nine years ago by selling refurbished computers from the boot of his car, says he heard about the EDF in 2010 and then applied for funding.

The business offers basic and advanced computer literacy training, internet services and sells computers.

“I needed 30 computers for my Blue Downs branch and received R100 000 in funding. The whole process took me about one and a half months,” says Rani.

The Blue Downs branch, which is open from 8 am to 8 pm, now employs about eight staff members and has some 200 walk-in customers daily.

Rani owns 18 branches in the Western Cape and eight in the Eastern Cape, and employs 115 staff in total.

Another speaker at the event was Ottery-based business owner Terry-Jo Thorne, who co-owns the family-owned business Thorne Trusted Barrier Systems with sisters Kirsty Thorne and Stacey Thorne. They are a much more recent recipient of the fund.

The business, which manufactures transparent burglar bars made from polycarbonate thermoplastic, received R46 000 in June this year and now employs six permanent and four casual staff members.

“As a result of the funding, we were able to decrease our price, increase our staff, upgrade our telecommunication systems by getting a PABX system, and improve internet speed,” says Thorne.

Thorne says the speed at which her application was processed was really helpful, since competitors were swooping in on her customers.

“You can’t tell someone to wait a month for their burglar bars until you are ready,” says Thorne.

The fund was launched by the Minister of Finance, Economic Development and Tourism, Alan Winde. The EDF was first piloted in 2010 and has provided funding in the amount of R3.5 million to small businesses to date.To apply for

finance, businesses must be based in the Western Cape, be operational for at least 12 months, have a valid tax clearance certificate, and must

be majority-black owned.“Business owners also need

a good business plan. There are rules – you can’t use the money

to buy a car or a house. You also need to analyse: Is the money going to effect change to job creation?” says Winde.

Business owners Terry Jo Thorne, Solani Lidzhade and Luvuyo Rani with Minister Alan Winde at the launch of the EDF.

Unit cuts tape and saves owner’s R12 m contract THE Western Cape Government is tackling inefficient and unnecessary processes which hamper business as part of the Red Tape to Red Carpet Programme.

The Red Tape Unit, which heads up the programme, is tasked with alleviating time-consuming regulatory and administrative processes by researching and submitting reports on which regulations most restrict business.

The Red Tape Unit is housed within the Western Cape Department of Economic Development and Tourism.

Raybin Windvogel, Director of the Red Tape Unit, says they submit reports to top-level management in different formats but have largely the same content.

“Essentially, we report on red tape issues such as blockages, and frustrations, identified through various means, of cases, queries and requests through the helpline, steps the directorate took to respond to these particular instances, and steps we contemplate with regard to a longer-term, systemic solution to the problems identified,” says Windvogel.

He says the Red Tape Unit is also required to name government departments, municipalities and public entities that fail to cooperate with the unit and are escalated to the appropriate management level.

According to a report commissioned during the 2011/2 to 2012/3 financial year, exporting, procurement by government, delays in processing of applications for work permits and applications for registration of abnormal load vehicles have been identified as the top red tape areas.

In a recent survey by Business Partners, 25% of business owners surveyed listed cutting red tape as the most useful assistance they could receive from government.

This useful assistance translated into a R12 million contract for one Cape Town business owner.

Steven Horwood, owner of 7 Sea Geoscience in Pinelands, says he would have lost the tender had the Red Tape Unit not stepped in to assist him.

“I believe that Minister Winde has hit the proverbial nail on the head with his Red Tape Unit and long may the Minister continue to tackle inhibitors to business growth.

“After all, depending on whose statistics one believes, only one in five small businesses make it past five years in this country,” he says.

Horwood, whose business offers services to terrestrial, construction and marine industries, says he won

a contract to conduct a geological survey for Transnet for the port dugout in Durban.

However, he was unable to obtain a Letter of Good Standing from the Department of Labour, without which he was sure to lose the contract.

A Letter of Good Standing is a letter stating that the business is registered with the Compensation Fund and that payments are up to date.

Says Horwood: “At one stage, my secretary tried to call the Department of Labour 24 times in one day, and the phone was not answered even once.”

After three months of waiting and with his previous Letter of Good Standing already two months expired, Horwood turned to the province’s Red Tape Unit, which assisted him in obtaining the letter within three days.

He says the renewal period for a Letter of Good Standing has now been extended to 12 months from its initial three month validity period

Another business owner was able to create 85 jobs and stopped the business from having to move out of the Western Cape after an intervention by the Red Tape Unit.

Since being launched, the waiting time for tender documents has been reduced from 45 minutes to five minutes.

The Red Tape Unit aims to save business owners from onerous requirements by improving time-consuming processes.

Hotline for red tape queriesA HOTLINE has been set up to assist business owners with time-consuming issues that frustrate business.

This part of the Western Cape Department of Economic Development and Tourism’s Red Tape to Red Carpet initiative is headed up by the province’s Red Tape Unit.

The initiative seeks to eliminate regulatory obstacles and bureaucratic delays faced by business owners who want to grow their businesses and create jobs.

The call centre will contribute to the programme’s objective by allowing business owners to call in and report issues to a clear access point. Should the call centre not be able to assist, the issue will be escalated to the Red Tape Unit.

Raybin Windvogel, head of the Red Tape Unit, says between July 2011 and July 2013, some 1 726 cases have been logged with the call centre.

“The finalisation rate (turnaround time) is approximately 88% within three months of the case being logged. • Business owners can contact

the call centre for assistance. The number is 0861 888 126.

Advertising Feature

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Business Process ServiceMega Investments 2012/13

The Department of Trade and Industry (the dti) aims to stimulate and facilitate the development of sustainable, competitive enterprises through effi cient provision of effective and accessible funding mechanisms (i.e. incentive schemes) that support national priorities.

Through the Business Process Services Incentive, the dti has generated a total investment of R1.3 billion during the 2012/13 fi nancial year, which created 3 838 jobs in the sector.

empowering industries and broadening economic participation

the dti Customer Contact Centre: 0861 843 384

the dti Website: www.thedti.gov.za

www.SmallBusinessConnect.co.za November 2013 - page 17

Hunger to learn brings successBY CAREL VENTER

NOTHING creates business succ-ess better than capable entre-preneurs with viable business models, willing to learn about how to improve their strategy and align their operations to achieve their objectives.

The first time I met Vuyo Luxande in 2012, it was clear that she was an extremely capable person.

As a mother and business owner, she was balancing normal household challenges with building a business at an enormous pace.

What was also evident was that she was willing to grow the business organically rather than create debt and start with all the luxuries.

Mthombo Development Ser-vices, at that stage, was reaching the end of a social services contract, hoping to renew and grow its market penetration based on its services delivery record.

While Luxande had to develop the market penetration with projects requiring extensive expertise, she also had to build the organisation and resources to achieve its bold vision.

In order to show the value of the business to potential clients, we focused on defining the vision, values and objectives of the business. This helped us make sure that all initiatives and resources were aligned.

Mthombo expressed a need to set clear objectives, achievable goals and realistic timeframes. Using strategy mapping, rather than a typical business plan approach, offered a clear, easily updatable and flexible guide to achieve their growth path.

Strategy mapping sessions with

the core team, including service providers and collaborators were held on weekends over a period of a few months.

We at Entrevise use a three-stage strategy mapping process:

“I believe that having a strategy map is very

important for any business as it serves as a reference

point on how to run your business.”

‘As is’ (the current reality): This includes the evaluation of the organisation’s current competitive reality based on the industry and company value chain, a contextual SWOT analysis based on the environmental impact analysis on industry and business, competitor analysis and client key decision indicator (KDI) evaluation against key competitors in each target market category.

‘To be’ (the ideal future): Here we cover strategy pyramid reviewing vision, values, mission,

core business, IP, differentiating value proposition and strategic objectives.

‘Bridge the gap’ (the strategy map): To move from the current status to ideal future, the Balanced Scorecard methodology is applied. This ensures that all resources and initiatives are aligned to achieve the strategic objectives.

The detailed implementation plan ensures easy performance management, while the one-page strategy map is easy to adapt (like GPS mapping), should circumstances require.

Mthombo largely accepted own responsibility to implement the strategy map.

According to their own report, they implemented about 50% of the first year initiatives due to changing goals and retaining a competitive edge.

Because they were using the Balanced Scorecard, they were able to adapt easily to competitive realities and opportunities.

The strategy mapping process worked very well for the entrepreneurs at a crucial stage of their life.

It assisted them in re-engineering their own thinking and understanding in which direction to steer the organisation.

Mthombo were able to use the strategy mapping experience

to evaluate new business opportunities and add additional services to the company. They were able to add new divisions like media, logistics and construction, and grow the business exponentially to a very healthy, profitable and diverse group.

More about Mthombo

• The company: Mthombo Development Services is a 100% black-owned and 80% women-owned company created to increase the participation in the South African economy by black professionals through four divisions: management consulting, infrastructure development, logistics and ICT.

• The entrepreneurs: Songezo Nabela, Monwabisi Luxande and Vuyo Luxande.

• The industry: Business support services.

• Innovation: The biggest innovation by Mthombo is in the publishing of a CSI magazine that will capture and showcase companies that have contributed in communities through their corporate social investments initiatives.

• Learning: Learning about the industry through academic programmes and their previous work experience.

• Experience: They have always been interested in business and have been involved in different business opportunities.

• Established: 2003• Most success: 2013/4.• Premises: Cape Town,

Johannesburg and Mthatha.• Staff: Two in 2011 to eight

in 2013.• Clients: CSIR, IDT, Department

of Social Development, Kopano Business Services, HEPF, YIZANI SAKHE, SAB Miller and the Airports Company of South Africa (ACSA).

• Annual sales: R20 million.• Profit: 12%.• Startup finance: Own capital

(no loans).

Meet the business adviser...CAREL Venter grew up in a small business household, with his family owning a clothing store in Windhoek. He is a Certified Business Adviser with Entrevise. He also serves on the executive of the Institute of Business Advisers (IBA) and is strategic adviser to the SA Small and Medium Enterprise Federation (Sasmef).

His involvement in supporting small business spans more than 25 years, starting with the Small Business Advisory Bureau in Potchefstroom. In 1993, Carel became the marketing manager of the National Book Printing Group (Naspers) and later General Manager, during which time he also completed an MBA. In 2002, he left Naspers and started business consulting full time again. In

2005, he completed the Institute of Independent Business (IIB) business school in London.

He has also participated in various SME development institutive and is an accredited service provider to PGWC, IDC, National Treasury, PALAMA and Seda. • Contact www.entrevise.co.za.

Carel Venter

Learning

from othersBUSINESS ADVICE as an accredited profession is fairly new in South Africa. This is why it is sometimes very difficult to decide who to approach to help address key challenges in your business. It is also not always clear how you and your business would benefit from business advice. You do not ask yourself who to appoint, but also whether appointing a business advisor would help at all.

Small Business Connect has teamed up with business advisors who are members of the Institute of Business Advisors (IBA) to present you with examples of projects they have worked on. In these examples, you’ll be able to see how the businesses benefited from the business support interventions, and you may also learn about something you can do in your own business.

The Institute of Business Advisors (IBA) is a SAQA- accredited professional body responsible for the assessment, accreditation and continuing professional development of business advisers, business counsellors and mentors assisting small businesses. The IBA aims to set standards of professional conduct by its members.

So, if you are looking for a business advisor, it is not a bad idea to look for an IBA-accredited professional. According to the IBA, business advice is the provision of “independent, impartial and confidential information and guidance” to potential and established businesses, based on “substantial business experience and current knowledge of related factors”.

Business mentoring, on the other hand, is an ongoing long-term business advising relationship between an experienced business adviser and client that covers a diverse range of topics as a business develops. Both mentoring and advising are aimed at creating a profitable business that is more effectively managed.

Advising and mentoring is more involved than business consulting, which is the assessment of business needs and the review of business functions, plans and directions, leading to the delivery of a report containing suggestions for the business. • For more information about

the IBA, visit www.ibasa.org.za, email info@ibasa.org.za or call 012 752 8972.

Get good results with strategic objectivesIT is always a privilege to be allowed insight into people’s dreams and aspirations. This is a special position business advisers always need to respect, and this is why utilising an IBA-accredited business adviser adds some peace of mind on value for money and professional conduct.

In South Africa, we have for very long had an overemphasis on business plans and funding for small business. Because the emphasis is on funding, the tool becomes the business plan. Unfortunately, a business plan is useless as a management tool; while an approved and funded business plan creates the impression with the entrepreneur that their business cannot fail, since the bank would not have approved the finance if the plan were not perfect.

Business modelling through business viability evaluation and a proper strategy to achieve objectives are prerequisites for

business success – not a funded business plan.

The biggest challenge is the growth rate and the need to ensure that they are going in the right direction. All too often, entrepreneurs believe they are unique and have no natural competitors. Then the risk is relying on too many assumptions, and too little real market and competitor research.

The example of Mthombo Development Services, covered on this page, shows how a focus on creating a good model and implementable objectives drive success, rhather than a funded business plan. Vuyo Luxanda and her team were really willing to learn and take advice. Even though she had to clarify some milestones with the other shareholders who could not attend the sessions, the owners created the vision and strategic objectives to mould the strategy around.

Vuyo Luxande says that a strategic map guides you to success.

page 18 - November 2013 SMALL BUSINESS CONNECT

City transport machine that takes a loadYOU can expect solidly built light commercial vehicles from Toyota. In the small van market, it offers the Avanza – covering from the 1.3S bus at R163 800 to the 1.3S PV panel van at R169 500.

I drove the slightly upmarket SX 1.5 automatic, available at R198 500. The top end model is the TX (R211 500) which has dual aircon, 15” wheels, chrome here and there, and many other car luxuries.

The Avanza is a city transport machine. It has a very small turning circle, pulls away quite briskly and stops rapidly. The SX Avanza has a 4-speed box and a 4-cylinder 1.5 litre petrol engine putting out 76kW @ 6000 rpm and a torque of 136 Nm @ 4 400. The 1.3 models generate 67 kW @ 6 000 rpm and 117 Nm at 4 400 rpm. There is no diesel engine.

Bearing in mind it is a smaller vehicle, it takes quite a load: seven people, or especially if you take out the rear bench seat, a huge boot with a cabin-wide door and a conveniently low cargo floor.

In short, the Avanza is a great little commercial vehicle well suited to city life. The three rows of seats are finished in what looks like durable cloth. The seats are

not very adjustable. Equipment includes manual airconditioner, electrically adjustable windows and mirror, power steering, courtesy lamps with door ajar warning, and an entry lamp in the door, speakers but no radio.

The latter cost around R600 from a car radio dealer. The interior is a little plastic. There is just too much hard plastic. It is a little noisy, but not overly so. The cabin is not unpleasant, it is just very functional. There are a large

number of nooks and crannies to put things, even a flipdown spectacle holder in the roof.

The airconditioner is very effective. The controls feel a little flimsy and will take a little getting used to.

The overall impression of Avanza is easy on the eye, with a balanced relationship between the various elements. It is available in six colours. The Avanza is a really good little runabout. The automatic gearbox as tested is very effective. The steering is light and easy to get used to. Acceleration is surprisingly good.

For a commercial vehicle, the Avanza is quite nimble and not unpleasant to drive. Just take corners carefully. A strong cross-wind tends to push this somewhat slabsided little van all over the place. ABS brakes are fitted as standard. Ground clearance is good, at 200 mm.

Toyota claims fuel consumption of 7.2 litres per 100 km. I think you will battle to improve on 8 litres per 100 km, and nearer to 9 in town.

The Avanza is a practical runabout workhorse that seats seven in comfort. It really works as a tough, simple car that can seat seven people (or a smaller van), and give years of trouble free motoring for a very reasonable price.

Service intervals are 15 000 km. Standard warranty is 3 years or 100 000 km. The service plan is 4 years or 60 000 km.

Goodness of the seventh generation Golf takes brand to new heights

BY WALLACE DU PLESSIS

VOLKSWAGEN’S seventh gen-eration Golf takes the Golf brand to new heights. These cars are really good. Good to drive, good to the environment and feel really good to sit in.

We tested the 1.4 TSI Comfortline manual. It’s the middle-of-the-range model and costs a rather substantial R274 900, excluding metallic paint, climate control and so on.

The top model remains the GTi at R368 300 and the base model is now the 1.2 TSI Trendline at R242 700.

Do not be fooled by the small engines. They are turbocharged and the 1.4 – which is also available with a supercharger – delivers 90 kW and 200 Nm with a top speed of 203 km/h and 0 to 100 acceleration in 9.3 seconds. Fuel consumption should be around 6 litres per 100 km.

The new 1.4 Golf is fast, agile and thrifty. It is also slightly bigger than the previous models.

Not only is it fast but it is both pleasant and fun to drive, depending on your mood or needs. This Golf is a real pleasure to drive in town. Roadholding and handling is even better than the Golf 6. It will not let you down.

As with all modern VWs, it comes fitted with a host of safety features, including what they call anti-spin regulation.

As with all VW cars, the interior is really good. I think it’s the best in its class.

Standard equipment includes aircon, 12.7 cm touchscreen, electronic parking brake (with hill-holder), tyre pressure monitor, front power windows, power side mirrors, multifunction leather-wrapped steering wheel, seven airbags, cruise control, under-seat trays, auto headlights and 16” alloy rims.

Roadholding and handling is even better than the

Golf 6. It will not let you down.

A more complete package than normal with VW, which makes this better value for money than VW normally offers.

The interior is a well put together premium package that will please for a long time. It sets the benchmark for small cars.

VW has produced a really good hatch that is hard to ignore if you are in the market for a smaller family-sized car. Also look at the VW Tiguan 1.4 TSI 90 kW Trend & Fun 4x2 BlueMotion at R299 900.

It is a small station wagon that looks like an SUV and has a higher ride height than the Golf, and which is useful in rural areas.

There are also two diesel models to consider, but I think the 1.4 turbo petrol is the one to go for. The Golf comes with a 5-year or 90 000 km service plan and 3-year or 120 000 km warranty.• For more motoring reviews by

Wallace du Plessis, visit www.wheelswrite.com.

Tiny with proper load box

BY WALLACE DU PLESSIS

NOW you can get the Spark as a tiny van called the Pronto.

GM transformed the Spark much like Fiat did with the Uno years ago, just much better, because it is built in South Africa.

Basically, they have stripped the seats out of the back and made a proper load box with a flat floor and a partition to the front. There are little burglar bars over the rear windows. This translates into a 275 kg payload and 876 litres of space.

The Pronto is just right for businesses that require a small, cheap delivery vehicle, with no need for bells and whistles. This gets small and light parcels as well as documents to clients quickly and inexpensively. It is ideal for security companies, florists and medical deliveries.

The Spark Pronto uses Chevrolet’s basic 1.2-litre four-cylinder petrol engine, like almost every other Spark. It’s quite perky, if a little noisy. It

produces 60 kW at 6 400 rpm and 108 Nm at 4 800 rpm, and propels the lightweight Pronto from 0 to 100km/h in a little over 13 seconds, with a top speed of 164 km/h. GM claims fuel economy of only 5.4 litres per 100 km. Expect around 6.

I found it more than adequate, almost nippy. The car keeps all the equipment of the normal Spark except the radio, but wiring and speakers are installed. It still features the same high passenger comfort and safety levels as found in other Spark models, with dual front airbags, ABS with EBD, power steering, remote central locking and airconditioning. The Chevrolet Spark Pronto costs R103 000. If you are registered for VAT, you can claim back the VAT on the vehicle. The Spark range comes standard with a 5-year or 120 000 km warranty and comprehensive roadside assistance, and five years’ anti-corrosion cover. A service plan is available as an optional extra.

The Toyota Avanza SX provides space for a load and a conveniently low cargo floor.

The Golf7 Tsi 057 is fast, agile and thrifty.

The Spark Pronto is a small and cheap delivery vehicle.

MOTORING REVIEW

www.SmallBusinessConnect.co.za November 2013 - page 19

onnectService Business Support

Service DirectoryThe Department of Trade and Industry (the DTI)

The DTI is responsible for implementing most of government’s business-related policies, including that of small business promotion. The services that the DTI offers are aimed at industrial development, export development, broadening participation in the economy and the development of small businesses.

In addition to the services available to small businesses through various DTI agencies such as Seda (see below in the directory), the DTI is also active in direct support to entrepreneurs through incentive schemes and trade programmes.

Various grants are offered by the DTI, including for businesses expanding their manufacturing capacity, businesses entering an export market and black-owned businesses in need of supplier development.

www.thedti.gov.za

contactus@thedti.gov.za

0861 843 384

Small Enterprise Development Agency (Seda)

Seda provides business development support to small enterprises ranging from start-ups to well established businesses. Many useful services are offered in partnership with specialised providers in the small enterprise support industry.

Entrepreneurs and potential entrepreneurs may approach Seda to gain access to the business support services they would otherwise not be able to afford.

As a key agency within the stable of the Department of Trade and Industry, Seda is tasked with implementing important elements of the government small business development strategy. Seda therefore works closely with other government agencies and provincial initiatives.

Potential entrepreneurs who are thinking of starting a business may apply to attend one of Seda’s many training programmes; while business owners who are at the stage of planning to expand and are in need of specialised support may apply for Seda to sponsor between 60% and 90% of the fees of an approved service provider.

It is not only independent business owners who may approach Seda – specific programmes are geared towards cooperatives and franchisees too. Seda also offers tender advice, networking and business linkages opportunities, technical support, export readiness assessment and productivity improvement.

To qualify for support, the entrepreneur must be 18 years or older, be able to run the business on a full-time basis, and have a valid South African Identify Document. The applicant must also pass credit checks and provide proof of residence.

0860 103 703

info@seda.org.za

http://www.seda.org.za

Small Enterprise Finance Agency (Sefa)

Sefa is the government’s primary small business funding agency, which was launched recently as a result of the merger between agencies such as Khula and Samaf. Sefa’s role is to promote the growth and the survival of small businesses through business financing.

The products on offer fall into two lines: Direct Lending Products aimed at direct service to small businesses and Wholesale Lending Products aimed at intermediaries who have small businesses as their clients. Direct Lending Products include bridging loans, term-loans and structured small business loans. while Wholesale Lending Products include credit guarantees, land reform empowerment facilities and equity investments.

To qualify for financing from Sefa an entrepreneur must be a South African citizen with a valid Identity Document. The business must be registered and have a fixed physical address.

The entrepreneur must own at least 50% of the business and manage the business. All the supporting documentation must be provided to meet Sefa’s loan application criteria, including a business plan which shows the ability to repay the loan. The entrepreneur must also provide personal and credit references.

Sefa does not support tobacco, liquor, gambling or sex trade, armaments, speculative real estate, leverage buy-out funds or any business involved in illegal trades, nor political organisations, people under debt review, or any business that have directors who are un-rehabilitated insolvents.

www.sefa.org.za

helpline@sefa.co.za

086 000 7332

National Empowerment Fund (NEF)

The NEF offers different types of funding in order to provide for different needs of business owners. The NEF supports black entrepreneurs and businesses by making various types of funds in different sectors available to the entrepreneurs.

The following are available to entrepreneurs: Strategic Projects Funds (SPF), Fund a Woman, Fund a Nation Project, Investor Education/NEF iMbizo, Post Investment and Mentorship Support, and the Junior Management Programme.

To qualify for funding the applicant must be 18 years or older, the business must be economically viable and must not be involved in illegal practices, tobacco or gambling.

The entrepreneur must be a 50% or more share holder and be operationally involved in the business, and be a previously disadvantaged South African with a valid South African ID, credit checks, and proof of residence. The applicant must also submit an application form and a business plan.

www.nefcorp.co.za

applications@nefcorp.co.za

info@nefcorp.co.za

011 305 8000

National Youth Development Agency (NYDA)The NYDA supports youth between the ages 14 and 35 through various programmes. The following services are available to young entrepreneurs: career information and guidance, mentorship, skills training, entrepreneurial development and support, loan funding, health awareness programmes and involvement in sport.

To qualify for funding, the business must be economically viable and cannot be involved in gambling, tobacco, property development or any illegal practices. An applicant must be 35 or younger; hold greater than 50% of the shares in the company; be a previously disadvantaged South African youth; and be operationally involved in the business. Proof of residential address, valid ID and credit checks, an application form and a business plan are required.

www.nyda.gov.za

080 052 5252

Companies and Intellectual Property Commission (CIPC)

The CIPC was established and launched in 2004 after the merger of the Office of Companies and Intellectual Property Enforcement (OCIPE) and the Companies and Intellectual Property Registration Office (CIPRO).

The CIPC’s role is to provide accessible registration services for business entities, intellectual property and regulated practitioners; and to maintain and disclose relevant information regarding business entities, business rescue practitioners, corporate conduct and reputation, intellectual property rights and indigenous cultural expression.

The CIPC also increases awareness and knowledge of company and intellectual property laws, this also includes opportunities for business entities and intellectual property rights holders to drive growth and sustainability, as well as the knowledge of the potential of these laws in promoting the broader policy objectives of government. The CIPC’s role is also to help businesses to take the necessary steps to visibly, effectively and efficiently monitor and enforce compliance with the laws of the CIPC administers.

www.cipc.co.za

info@cipc.co.za

086 100 2472

Limpopo Economic Development Agency (Leda)

Leda was formed after the amalgamation of Limdev, Libsa and TIL. The services offered by these agencies are now all consolidated under Leda. Included in Leda’s services are finance to small businesses within the Limpopo province. It is also active in housing finance, mining and public transport. The focus is to assist business owners in making better investment and finance decisions. Leda also supports businesses from Limpopo province through a range of

information sources such as a quarterly newsletter, monthly information sheets and occasional booklets; as well as by offering business support services to entrepreneurs. Many of the media products are published in indigenous languages. The Internet is also used as another means of communication, since it is fast becoming an option to business travellers. At each Leda office entrepreneurs may use the computerized library with many useful business information sources. Business support and training services are offered in the following sectors: Mining, Tourism, Agriculture, Manufacturing, Construction and Information Communication Technology. All non-financial support services are offered free of charge, with an emphasis on assisting with challenges in marketing, distribution and processing of agriculture products.

www.leda.co.za

015 633 4700

The North West Development Corporation (NWDC)

The NWDC offers services to small businesses of the North West Province by assisting them with access to finance, business advice as well business mentorship and coaching.

Three types of funding are offered: Start-up funding for new businesses, general finance for the expansion of existing businesses, and bridging finance that caters for emerging contractors and suppliers of goods and services.

To qualify for these funds the entrepreneur or small business owner must be registered as a Sole Proprietor, Close Corporation, Partnership or Company. The business must have a valid tax clearance certificate from Sars, a business profile, a business plan, securities (such as the deed of grant, title deed insurance policy, investments surety-ship document or the cession of progress payment) and supporting documents like proof of residents, certified copy of ID document, copy of contract and 3 months bank statements.

www.nwdc.co.za

018 381 3663

Free State Development Corporation (FDC)

The FDC is the official economic development, trade and investment corporation for the Free State. Funding (such as business loans, equity and investments), as well as business development (which includes training, coaching, mentoring and partner support services) are some of the products and services the FDC delivers to small businesses.

The FDC administers a wide range of property portfolios and its property management unit offers small to medium enterprises suitable premises at affordable rates. The FDC has some 940 properties including 400 factory units, which they aim to use to facilitate commercial and industrial activity, while assisting new investors who may be looking for suitable premises.

The following incentives are also offered by the FDC, subsidised rental rates, rental

holidays of up to three months and special incentives and discounts for BEE companies or individuals.

www.fdc.co.za

lesley@fdc.co.za

051 400 0800

Royal Bafokeng Enterprise Holdings (RBEH)

Royal Bafokeng Enterprise Holdings is a community-based investment company which strives to improve economic well-being by investing in businesses that will generate returns and by supporting small businesses. The RBEH teamed up with The Business Place in Phokeng, to ensures that the small business support services offered by The Business Place reaches many start-up, very small, survivalist and micro businesses.

www.bafokengholdings.com

info@bafokengholdings.com

011 530 8000

Mpumalanga Economic Growth Agency (Mega)

Mega supports qualifying businesses and individuals from Mpumalanga, who’ve been previously disadvantaged, with funding for housing, agricultural development and business growth. Loans range from R10thousand to R3million.

To qualify applicants must be a South African residents with a South African Identity Document, be between 18 and 65 years, and have access to land or production facilities. They will also undergo a credit check.

www.mega.gov.za

013 752 2440

The Business Place (TBP)

The Business Place aims to offer new ways of meeting the support requirements of entrepreneurs. Several small business support centres have been established across South Africa. At these centres entrepreneurs have access to mentors who provides entrepreneurs with one-on-one support in starting or growing their businesses. Entrepreneurs can also get access to business opportunities, relevant business information and resources.

At TBP centres entrepreneurs are referred to the best suited business development service providers, government resources and financial institutions. TBP provide entrepreneurs with free internet access for business research and getting ideas. They can also get legal advice, micro- MBA practical training, business-to-business networking opportunities, business workshops and free use of the meeting and training rooms.

The following TBP centres are currently in operation: Alexandra, eKapa, Gabarone, Joburg, Kliptown, Metsweding, Philippi and Phokeng.

network@tbp.co.za

www.thebusinessplace.co.za

011 833 0340w

page 20 - November 2013 SMALL BUSINESS CONNECT

Endurance pays off in winning tendersBY DANIEL BUGAN

DOING business with government can be very rewarding, but securing a tender is not always easy and if at first you do not succeed, do not give up, says a business owner who tried six times before he was awarded his first tender.

Trevor van Rooyen, owner of Migma Engineering, a company that manufactures high masts and steel structures, says settling on the right price and quality was what clinched it for him. But it was a journey of trial and error.

“I had to learn to not rush through the documents, to make sure I interpreted it correctly before submitting, being as honest as possible when completing the tender documents and sourcing material at the most affordable rate. But, most of all, I had to learn to seek advice and guidance from business owners who had been awarded awarded tenders,” says Van Rooyen.

Most importantly, make sure that you have money in reserve, as you have to put down a guarantee of 10% of the value of the contract, says Van Rooyen.

The business owner has 14 days after having been awarded the contract to come up with the 10% guarantee.

Van Rooyen, whose company has won contracts with the City of Cape Town, Stellenbosch and Buffalo City, says doing business with government is safe and you are guaranteed your money. “This

is not always the case should you subcontact, unless you’ve got a legal contract in place between you and the contractor.

Another benefit from doing business with government departments is that they will refer you to other departments if you have built up a good reputation and track record, he says.

Other lessons he has learnt from doing business with government over the years include providing all the information requested in the tender application and not forgetting things such as

a tax clearance and shareholding certificates.

He also says business owners need to provide the correct calculations of tender prices and must always sign the bid document, as unsigned documents are discqualified.

It is also important to make sure that you drop the tender in the right box before the closing date since by law, no late bids will be accepted, even if it is a second past the closing time.

He sources his tenders from, among others, the City

of Cape Town, Transnet, Spoornet and Eskom websites. Other sources include:

Provincial governments advertise their tenders in the various Provincial Gazettes. Contact your provincial government to find out where you can order a copy or whether they have tender opportunities on the internet. Around 450 Local Government (municipality) Tender Authorities also put out tenders.

Generally, you must make contact with your local municipality

and must keep on reminding them of your existence. Also ask them in which local newspapers they tend to advertise.

The central or local offices of some parastatals may also be approached directly. Find out in which newspapers (or elsewhere) they advertise and whether they keep a database of preferred suppliers. If so, find out how you can get onto that database.

For government tenders generally, always keep an eye on the major national newspapers, your own local newspapers, and notice boards at government departments, post offices, police stations and elsewhere.

If your business operates countrywide, you must also focus on the national sources of tender information. If your business is local, you concentrate on local sources.

Private sector databases: There are commercial services available that scan the business world for as many tenders as possible. They gather the information and sort them into categories.

When you subscribe to their services, they send you the information on available tenders in your industry. It is very handy if you don’t have time to phone around and scan all the newspapers and bulletins.

There are a few such services available, such as Tenderscan and Sabinet.

Tradeworld is probably the most comprehensive service.

Small firms are well suited to provide a range of products and services to national, provincial and local government.

Are you tender-ready?IS your business ready to tender? Answer these questions to check:• Is your business registered? • Do you have a good banking

record, credit history and relationship with suppliers and clients?

• Are you able to deliver – on time, on budget and according to specifications?

• Are you up to date with taxes? • Are all your bills paid?• Do you have the required cash

flow and other resources to complete the tender?

• Are you actively looking for business opportunities?

• Are you able to deliver consistent quality?

• Do you have qualified employees?

• Do you have or can acquire the right equipment, clothing and accessories to complete the tender?

• Are your employees registered with the Department of Labour for UIF, the Skills Development Levy and Workmen’s Compensation?

• Do your products comply with SABS standards?

If you answered yes to these questions, your business is ready to apply for a tender.

If you answered no, it is time to get your business tender-ready

so that you do not miss out on any further opportunities!

TIPS FROM PROCUREMENT OFFICIALS

It is useful to understand what the officials who award tenders look for. Here are some tips from procurement officials:• Always read through the bid

documents carefully.• Complete the document in full.• Do a proper cost analysis when

calculating your bid prices. Bids calculated too high or too low are considered ‘unresponsive’.

• Enquire about the bid and obtain all the relevant information before completing the tender document.

• Feel free to ask why you were unsuccessful, so that you may learn from mistakes made.

• Make sure that you are able to meet all the requirements within the specified time and are able to honour your offer in the event that your bid is successful.

• Do not make any false statements in your bid documentation. It is a legal document and therefore enforceable by law.

• Quality services and products will improve your track record and good standing with the department. Poor delivery creates a negative impression, not only for your business but for all small businesses in general.

Get your business news on the webWE are very fortunate to live in an era where we can get swift access to information through a media channel most suitable to our needs. The articles published by Small Business Connect are available in various formats so that you can select the one most suitable for you:• You may collect a copy of the

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our website regularly. We post a new article almost every working day, so you are bound to find something new there. On the website you can also participate in discussions at the bottom of each article, or post your ideas on the covered topic.

• Our web address is www.SmallBusinessConnect.co.za.