This was one of the findings of the SMEs Survey 2007, the results of which were released last month.
The survey studies the factors behind the competitiveness of SMEs in South Africa and was launched in 2003.
“The findings are shedding light on how SMEs in South Africa use available resources to their best advantage. “This is both fascinating and highly useful for new businesses looking to increase their odds of prosperity,” says principal researcher Arthur Goldstuck.
He warns that there is no clear set of rules for success and the specifics of what will work and what will not change from business to business.
“The use of computers in the business is immediately related to heightened competitiveness and there is a direct relationship between the number of computers used and the competitiveness of the com- pany,” adds Goldstuck.
He points out that, of those using more than ten computers in their environment, more than 46% are competitive and, where more than 50 computers are used, more than 54% of the companies are competitive.
Backed by Standard Bank and Fujitsu Siemens Computers, the survey indicates that 42% of SMEs in South Africa regard themselves as highly competitive.
The market targeted by the SMEs does not make a difference to competitiveness, whether it is corporate, retail or consumer. However, those targeting government businesses tend to be most competitive, the survey found.
The survey also highlights that crime is the most worrying issue for small-business owners, followed by cash flow-related issues.
Of the 5 000 business owners and financial decision-makers contacted by telephone, some 27% cited crime as the most worrying factor, with about 19% saying that cash flow was the most worrying part of their business, while 13% cited issues relating to debtors.
Fujitsu Siemens Computers business development director Danny de Beer believes the survey shows the value of taking the time to establish supplier relationships to free up one’s time to focus on strategic or revenue-generating activity.
“The use of professional services and financial instruments delivers further advantage, notably the engagement of a mentor. “While only 10% of SMEs consult a mentor, 50% of these regard themselves as highly competitive,” says De Beer.
He adds that SME owners are eager to find technologies and services to improve their efficiency but do not get around to it.
“Many SME owners spend too much time on relatively arbitrary functions instead of paying a specialist to handle it for them. “However, the problem is twofold: one is that the business owner may not trust the available service providers or know how to find them, and the other is one of cash flow.”
Standard Bank director of business banking Melt van der Spuy says that despite the findings of the survey, any successful entrepreneur is one who will see opportunity where there are challenges, and those using professional and mentoring services are likely to have a more strategic, rather than operational, focus.
“These services are strategic by nature. The business owner who has recognised the need for specialised strategic support has moved beyond an operational focus. He is working on the business, as opposed to working in the business,” reiterates Van der Spuy.