Tag: economy

2013 EOY competition launches

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25 years on and still committed to fostering entrepreneurship in SA

Entrepreneurship is crucial in stimulating a country’s economy, as well as fostering critical skills development and job creation. It is therefore vital that entrepreneurship is embraced and celebrated locally.

Celebrating its 25th anniversary this year, South Africa’s pre-eminent entrepreneurial showcase, the 2013 Sanlam / Business Partners Entrepreneur of the Year® competition has been launched, offering a free platform for the country’s leading entrepreneurs to share their achievements and elevate the profile of their businesses, as well as their profits.

According to Nimo Naidoo, project manager at Sanlam / Business Partners Entrepreneur of the Year®, the competition also provides entrepreneurs with the chance to win prizes worth R 1 340 000, which includes cash prizes to the value of R300 000. “Beyond the chance to win, previous finalists and winners’ businesses have benefitted significantly from the competition’s various networking opportunities and associated marketing and national media exposure,” says Naidoo.

According to 2012 Sanlam / Business Partners Entrepreneur of the Year® overall winner, William Duk of The Plantation Shutter Co., no marketing budget could ever be big enough to purchase the level of exposure that was generated on his behalf. “The award also adds to the level of credibility that a business has in the market place.”

Tabisa Nomnganga of Bravo Promotions, one of the category winners of the 2012 competition, says that winning the Emerging Entrepreneur Award has increased her confidence as an entrepreneur as well as her client base. “Since winning the award in September, I have signed up three lucrative business deals which in total amount to over R500 000. My bottom line profits have also increased by over 40% from the previous financial year.

“In addition, I have had to increase my staff compliment and have thus created more job opportunities within my community.”

Naidoo adds that 2013 entrants will also experience a new streamlined entry and judging process. “This is to primarily ensure that entrants do not become over-burdened during the entry form completion phase and we now expect even greater interest and participation from entrepreneurs from across the country.”

She says that one of the key aims of the competition is to acknowledge successful entrepreneurs in the small and medium enterprise sector and their relentless drive to grow their businesses to keep our economy ticking. “Through this initiative we focus on celebrating entrepreneurship and promote the successes of our heroes in the SME industry.”

According to Naidoo, the competition is open to entrepreneurs from all industries and for businesses of any size. The 2013 competition will also feature a series of national workshops where crucial entrepreneurial skills will be provided to attending business owners.

Entrepreneurs interested in entering can do so here as well as interact with fellow entrepreneurs and entrants on the Sanlam / Business Partners Entrepreneur of the Year® competition social media platforms: twitter: @EOY_SA and Facebook: www.facebook.com/EOY.SA.

The closing date for the competition is 16 June 2013.

Photos: 2013 EOY Cape Town launch

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Can entrepreneurship help solve the unemployment crisis in SA?

What do the experts say about unlocking entrepreneurial talent as a solution to address our unemployment crisis? Are we celebrating entrepreneurship and acknowledging entrepreneurs as the heroes of our economy?

These questions and other issues affecting entrepreneurial growth in South Africa will be discussed at the launch of the 2013 Sanlam / Business Partners Entrepreneur of the Year® competition.

Keynote speaker: Fred Robertson, a leading figure in the South African business community who co-founded Brimstone Investment Corporation Limited, and is currently Executive Deputy Chairman, Brimstone and Chairman of Lion of Africa Insurance Company Limited, Lion of Africa Life Assurance Company Limited, Sea Harvest Holdings (Proprietary) Limited and House of Monatic (Proprietary) Limited.

Welcome to 2013

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Feed on the positive SME entrepreneurs!

The Sanlam / Business Partners Entrepreneur of the Year® team welcomes you to 2013! May we feed on the positive this year and not allow the eternal pessimists to shape us into a negative frame of mind. May we celebrate entrepreneurs and their relentless drive to grow their businesses that are keeping our economy ticking and promote the successes of our heroes in the small and medium business world.

Although businesses are most likely to face challenges going forward, business owners / entrepreneurs shouldn’t blow these hindrances out of proportion and forget about the great strides they have made in continuing to grow, rendering goods and services to their target market, employing people, paying their taxes and contributing towards the wellbeing of their communities?

As we consider what the year might hold for South African businesses one realises that the only certain aspect is the economic uncertainty that prevails in the country and the world. If one however takes stock of what we have to be grateful for, there is much positivity to feed on.

The South African economy grew marginally by an estimated 2.5% (in 2012) and economists forecast growth of about 3.5% in 2013. Although this growth is not enough, it should result in demand for your services also growing marginally. This boils down to increased sales, which could be even more positive if businesses manage to outplay their competitors with better service and competitive pricing.

Entrepreneurs are more than likely to be experiencing the lowest interest rate environment they have encountered in the history of their businesses. Are you capitalising on this? In most businesses the cost of debt (interest) is amongst the three highest expense items on an income statement – now this cost has decreased down to prime lending rates of 8%. In a SME’s case the saving on the interest bill alone could be 50% or more when compared to four years ago.

In real terms the saving is even more and should be used to reduce the debt in the business, in other words, paying off more of the capital portion of loans or to fund the working capital needs of a business. SME owners could also consider paying creditors/suppliers sooner, but this should only be considered if they are able to provide early settlement discounts. This is another positive aspect to feed on!

The lower inflation environment experienced over the past few years should bring some stability in ensuring that prices do not run away. In order to embrace this, costs should be managed appropriately and negotiations with suppliers and other service providers to limit their price increases should be considered. South African businesses already have to contend with substantially higher than average inflationary electricity costs and cannot absorb more price increases. A lower inflationary environment is a further positive for SMEs.

Commodity prices are on the increase and with the weaker rand, the rand prices of commodities are increasing even more. With demand for commodities also picking up and mining strikes hopefully under control, mining activities should increase locally through higher output and a renewed drive to increase capacity through an increased capital expenditure programme. This is positive for direct job creation and will in turn increase the level of consumer spending as overall disposable income improves. Sub-contractors to the mining industry are mostly small and medium-sized businesses and their order books should hence benefit directly. This is a positive for SMEs operating in the mining service sector and/or servicing mining communities.

South Africa is playing a leading role in the Sub-Saharan economy. It is estimated that this region will grow nearly two and a half times faster than the advanced economies of the world as we head towards 2020. This fast growing region is economically viable and this is seen by other emerging giants such as China and India as an opportunity. These regions realise that they need South Africa as an entry point into the continent and that our country is the best place to settle in first, as we are the strongest economy on the continent, with the best infrastructure from which they can leverage. South African SMEs should view this as an opportunity as businesses can be grown by being these regions’ local agent and service provider. The opportunities clearly outnumber the threats.

SMEs and business owners should feed on the above positive pointers and develop strategies for the year ahead, which will also assist in a positive change of mind frame. Challenge yourself and be positive – also remember to not be all things to all people. As an SME, you should try to be an efficient niche player mapping out a future in a growing market that still has many opportunities just waiting for the real entrepreneurs to take up and run with them.

I wish you all great success in 2013 and know that as a real entrepreneur you will be able to capitalise on opportunities and create gaps for your business, even where there are not so many obvious ones. Good luck!

Christo Botes
January 2013

The state of entrepreneurship in South Africa

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South Africa’s entrepreneurial activity, over the past eight years, has shown vast improvement, however the economy lags behind comparable economies and has not fully utilised the economic potential that is available in entrepreneurial opportunities.

According to Nimo Naidoo, project manager of the Sanlam / Business Partners Entrepreneur of the Year® competition, South Africa has the ability and the resources available to support entrepreneurs, but believes that the country has yet to develop a strong entrepreneurial culture to drive it.

 

 

 

Entering awards best promotional tool available to SA’s entrepreneurs

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Entrepreneurs in South Africa often struggle to generate a credible reputation in a turbulent sea of competition, which often consists of large market players. Local entrepreneurs are also generally financially limited and unable to utilise traditional promotional tactics and national-scale advertising campaigns.

Through entering competitions and awards, entrepreneurs are often able to overcome these challenges as these platforms are not only cost-effective, but if successful, can have a significant effect on the brand reputation and bottom line of a new company.

This is according to Nimo Naidoo of the Sanlam/Business Partners Entrepreneur of the Year® awards, who believes that South African entrepreneurs need to utilise every available business resource and opportunity that presents itself.

“In our country’s rapidly growing and highly competitive SME market, entrepreneurs are already facing a wide variety of challenges, while having to compete with the big market players of their respective industries. Entrepreneurs also face financial restrictions in attempting to promote their business and diversify themselves in a usually over-crowded market space,” says Naidoo.

“The benefits gained, as a finalist in the Sanlam/Business Partners Entrepreneur of The Year ® competition, have been absolutely invaluable,” says Elian Wiener, the founder and MD of national strategic communications and PR agency, Epic Communications, and winner of the Emerging Entrepreneur of the Year 2011 and Innovator of the Year 2011 titles last year.

“My participation in the competition has been instrumental in fuelling new business growth for Epic Communications. As a direct result of the contacts made and the exposure gained from the competition, we have secured new business worth more than R1 million per year in revenue.”

These sentiments are echoed by Marc Sternberg, MD of independent ATM deployer Spark ATM Systems, who says he has recorded improved business performance since winning the 2011 Overall Entrepreneur of the Year® award. “The acknowledgement that winning the award gave us has undoubtedly allowed us to accelerate our continued growth path through various new and exciting business opportunities. Our growth rate has actually accelerated this year to over 60% year-on-year in our core areas of ATM deployment and transaction fee income.”

Naidoo firmly believes that industry awards, such as the Sanlam / Business Partners Entrepreneur of the Year® awards, are one of the easiest and most inexpensive ways for entrepreneurs to stand out from their competitors. “Entering competitions also allows entrepreneurs the opportunity to earn a credible corporate reputation or image, which can potentially be magnified by mass media exposure.

“Intangible assets, such as an excellent corporate reputation, can be used as a valuable promotional tool by entrepreneurs and, since it cannot be replicated by competitors, provides them with a sustainable competitive advantage over their competitors, which then translates into superior financial returns in the long run.”

The Sanlam / Business Partners Entrepreneur of the Year® competition is widely considered to be the pre-eminent competition of its kind in South Africa and has served as a springboard for past finalists and winners. Besides the chance to win prizes worth a total value of R1 345 000, which includes cash prizes of R200 000, finalists and winners are able to expand their networks and receive invaluable exposure for their businesses.

“The staggering rise in unemployment levels and a tightening squeeze in the formal employment market has resulted in job seekers and government turning their attention towards creating jobs in the SME and entrepreneurial sector of the economy.

“Government’s 2030 objectives state that 90% of all jobs created should be in the SME space and any platform established to recognise leading entrepreneurs, as well as educate prospective entrants to this sector are crucial in helping to reach this goal,” concludes Naidoo.

Competition entrant turns hobby into successful business

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Being an entrepreneur in South Africa is no easy task. Local entrepreneurs need to constantly challenge the obstacles that restrain them and recognise these challenges as opportunities that hold the key to unlocking future success.

The 2012 Sanlam / Business Partners Entrepreneur of the Year® competition aims to commend successful entrepreneurs who continuously conquer these challenges, while becoming role models for the entrepreneurs of tomorrow.

Prakash Premrajh, founder of UKD Marketing and entrant in the 2012 Sanlam / Business Partners Entrepreneur of the Year® competition, started UKD marketing as a humble hobby, fuelled by his passion for woodwork. In 1980, Premrajh turned his pastime into a career path by investing a mere R500 and appointing a single employee. Today, UKD Marketing employs over 300 people and operates on a national scale. The company has grown from an idea into a fully fledged furniture empire.

Premrajh says that he never aspired to be an entrepreneur.

“My vision was to be an accountant, but my passion lay in woodwork and design. This passion began as a hobby and within two years my passion became my life.”

However, Premrajh’s pursuit of this passion was not an easy task and he faced many overwhelming challenges that are common amongst most entrepreneurs.

“My biggest challenge as a small merchandiser was breaking into an industry dominated by large market players. Once this hurdle was overcome and my company began to grow I was faced with another obstacle – financing. Business Partners’ faith in my business has allowed UKD Marketing to take the necessary growing steps. Once I took the step from a regional scale to a national scale I experienced many logistical and administrative challenges in managing such a large enterprise. Overcoming these obstacles is what breeds success and it is key to recognise these challenges as opportunities rather than barriers.”

“My wife Shereen Premrajh joined the company in January 1981 in the admin department. She also used to control the production when I travelled out calling to our customers. Shereen has been a pillar of strength to our company in that she took full control of the administration & control of merchandising. It’s said that behind every successful man is a woman, this proves true.”

Premrajh believes that entrepreneurs can play a pivotal role in the economy if they are not oppressed by ‘red tape’.

“The state has a lucrative opportunity to create jobs and generate economic growth by creating a hospitable environment for entrepreneurship to flourish in South Africa. Being an entrepreneur in South Africa is no easy task, therefore recognising and congratulating the successful entrepreneurial minds of our country is of the utmost importance.”

Premrajh entered the 2012 Sanlam/Business Partners Entrepreneur of the Year® competition with the intention of gaining valuable business exposure.

“My business relies on credibility and reliability, and I feel that success in such a prestigious event would directly translate into improved client confidence and better sales results.”

The impact of global economic trends on entrepreneurial activity in SA

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As South Africa’s economy is susceptible to global trends, it is imperative that entrepreneurs are cognisant of both local and international economic trends, as they are undeniably going to play a role in the success of their company.

This is according to economist Ulrich Joubert, speaking at the recent series of Sanlam / Business Partners Entrepreneur of the Year® competition workshops.

According to Joubert, any economy operates within the framework of Government policies, be it fiscal or voluntary.

“Every year when the time for the Budget speech arrives, businesses wait with abated breathe to absorb how the imminent rise in costs will impact them financially.”

Joubert explains that a rise in costs, combined with a rise in unemployment substantially impacts South African consumers’ disposable income, which ultimately has a negative effect on businesses, especially SME’s. “Local business owners needed to be vigilant in tracking issues affecting the current economic environment, as well as larger global developments that could potentially influence the growth and success of their companies.”

He predicts rather slow economic recovery in the near future, both from a local and an international point of view.

“The South African interest rate environment will become stable in the next few years, but currency markets will continue to remain unstable. Despite these issues, business owners should be able to survive in the current economic environment if they manage their businesses correctly and keep costs under control.”

He is of the opinion that there is always opportunity for entrepreneurial activity in South Africa.

“In order to take advantage of these opportunities, entrepreneurs and business owners need to identify opportunities and know how best to utilise them from an economic, as well as business perspective.”

Joubert says that the purpose of the national Entrepreneur of the Year® workshops is to educate entrepreneurs and business owners on how economic trends can affect them going forward.

“In order for entrepreneurs to succeed in these economic conditions, they need to cultivate their entrepreneurial spirit while understanding the challenges of the global economic environment.”

World entrepreneurship day a rallying call to aspiring SA entrepreneurs

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Aspiring South African entrepreneurs need to take note of the successes being celebrated by their global counterparts on World Entrepreneurship Day (WED), 15 April 2012, as well as use the day as motivation to get better at spotting and taking advantage of ‘entrepreneurial gaps’ in specific industries, in order to create sustainable businesses.

This was the message from Nimo Naidoo, project manager of the Sanlam / Business Partners Entrepreneur of the Year ® competition, in the run-up to WED, who says that South Africa’s economic prosperity relies heavily on the actions and successes of the country’s existing and future entrepreneurs.

“The Global Entrepreneurship and Development Index (GEDI) recently revealed that South Africa’s global entrepreneurial ranking has fallen from 39 in 2011 to 45 in 2012, losing pace with smaller GDP countries such as Colombia and Peru. Entrepreneurship serves as a catalyst for economic growth and national competitiveness, and for an emerging economy such as ours this ranking is simply too low,” says Naidoo.

She says that in order to foster a culture of entrepreneurship locally, prospective entrepreneurs need to overcome barriers such as fear of failure and funding. “Tackling the first barrier is not always so simple, as South Africa’s society has a culture that neglects entrepreneurial activities, especially individuals who have failed in the past.”

Naidoo suggests that more needs to be done to identify and profile entrepreneurial role models, in order to give aspiring entrepreneurs an idea of the rewards and benefits of enterprise creation and reduce the stigma of failure.

“Initiatives such as entrepreneurial competitions, formation of bodies, government-sponsored awards and recognition from the private sector would all contribute to raising the profile of South Africa’s most innovative and successful entrepreneurs. In addition, these actions would also assist with creating a society that values and respects entrepreneurial spirit.

“Initiatives already in place to promote and grow entrepreneurship, such as Global Entrepreneurship Week in November and The Jobs Fund, under the custodianship of the Development Bank of Southern Africa, which co-finances projects by public, private and non-governmental organisations, have already had a positive effect with regards to job creation and entrepreneurial spirit in South Africa.”

She adds that role models are also key to educating South Africa’s youth about entrepreneurship. “There is a great opportunity for our youth to choose entrepreneurship as a career and become job creators rather than job seekers. Our education system should also promote entrepreneurship as a career. Entrepreneurship will then also address unemployment issues at a youth level by providing an outlet for the talents of many highly educated young people, such as college and university graduates, especially in globally-growing industries such as information technology.”

On the barrier of funding, she says that more support and attention in fiscal and government policy is necessary to stimulate entrepreneurial activity, which can ultimately lead to the country’s economic recovery. “We also need to investigate the implementation of new finance models and methods in order to broaden the access of finance to more entrepreneurs.”

Naidoo adds that the inclusion of structural policies that determines and clarifies the overall economic framework in which the local business sector operates, such as policies affecting labour markets, tax, competition, financial markets and bankruptcy laws, will also be conducive to entrepreneurial growth.

“As a group, entrepreneurs represent the best hope of creating sustained economic growth in South Africa. As we celebrate WED, we can see the tangible economic benefits that pro-entrepreneurial policies in emerging economies such as Brazil and India have achieved.

“It is now our country’s turn to create an entrepreneurship climate to create employment and build sustainable, high growth companies,” concludes Naidoo.

More female entrepreneurs needed in SA

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South African women make up approximately half of the country’s work force and therefore play a crucial role in the development of the economy. However, the low level and quality of female entrepreneurship in South Africa is hampering entrepreneurial growth and activity, as well as the country’s economic development.

According to Nimo Naidoo, project manager of the Sanlam / Business Partners Entrepreneur of the Year® competition, the profile of South African entrepreneurs has remained largely unchanged in the recent past.

“Although female entrepreneurial activity participation has gradually increased in 2010, South Africa is still behind the curve when compared to other emerging economies as men are still substantially more likely to be involved in Small and Medium Enterprise (SME) development than women”

Naidoo says the 2010 GEM Women’s Report – which gauges entrepreneurship in 59 countries – states that women are equally likely to view entrepreneurship as an attractive opportunity as men, but tend to doubt their own personal capacity and ability, which may be attributed to their lack of personal contact with other female entrepreneurs.

“Research shows that the probability of a woman becoming an entrepreneur is vastly improved when she is exposed to fellow female mentors and role models.”

She says female entrepreneurs tend to pursue small-scaled necessity-based entrepreneurship, predominantly in the informal sector. “The 2010 GEM Report stipulates that the key to unlocking potential economic growth and job creation is through investing in ‘opportunity entrepreneurs’ and not ‘necessity entrepreneurs’. Men are twice as likely to be involved in opportunity-based entrepreneurship when compared to women.”

The latest Labour Force survey, conducted by Statistics SA, indicates that the female unemployment rate of 28% is 5.5% higher than that of their male counterparts. Naidoo says it is therefore crucial that improved entrepreneurial attitudes among women are created in order to improve female employment rates.

Naidoo explains that most policy makers and academics commonly recognise entrepreneurship as a key ingredient that fuels economic growth and job creation. “Not only does entrepreneurship positively impact a country’s economy, but it improves the social well-being of the country. Research from the GEM report conclusively illustrates a direct link between the level of entrepreneurial activity and per capita income.”

Photos: 2011 EOY winners

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The Entrepreneur of the Year® Awards is about celebrating entrepreneurs and creates a platform to give acknowledgement and recognition to the unsung heroes of our economy, the successful entrepreneurs, for their vision, innovation, perseverance, drive and commitment to their enterprises. This year saw the competition growing in leaps and bounds towards becoming the premier competition for entrepreneurs in South Africa. We would like to congratulate all our 2011 winners and we wish them all the best in their future endeavours.