In an effort to eradicate one of the challenges facing small, medium-sized and micro- enterprises (SMMEs) in Southern Africa, the Association of Southern African Development Community (SADC) Chambers of Commerce and Industry (Ascci) has launched a new SMME business tool kit. The tool kit aims to challenge SMMEs’ lack of access to information and to create a guideline to assist entrepreneurs in starting, growing and sustaining their businesses.
Ascci CEO Sipho Mseleku says that challenges facing small business include access to infrastructure, finance, markets and technology.
SMMEs contribute significantly to the growth of the gross domestic product (GDP) in many countries. Sixty percent of SMMEs in African countries and 75 % in the industrial- ised world contribute towards the GDP of the country. “We believe it is important that investment is made in countries where economies can be grown,” says Mseleku.
After conducting extensive research, Ascci decided that investment in countries in Africa that had the potential to grow their economies was necessary. This resulted in the organisation fulfilling its agenda towards developing small businesses, with the process initiat- ed first in South Africa.
The SMME business tool kit was first rolled out at an Ascci annual general meeting (AGM) last year, attended by over two thousand SMMEs (Ascci members). In October 2006, the tool kit was officially launched at a conference in Soweto. Two thousand tool kits were distributed at the launch, which, Mseleku says, contributed greatly towards the current success of the tool kit.
The Gauteng enterprise propeller bought 70 000 of the business tool kits with Sector Training and Education Authorities (Setas) obtaining 25 000 copies. The acceptance of the tool kit into the market is better than the organisation had anticipated. “Our target is to distri-bute 50 000 business tool kits a year and the demand for the kit throughout South Africa far exceeds our goal of 50 000,” says Mseleku.
Meanwhile, Mseleku says that over the next two years, Ascci wants to create an entrepreneurial society, which provides trade to countries to create employment and opportunities.
Mseleku points out that it is not merely distributing the tool kits that is of importance, but says, “Ascci wants to monitor the progress of the business and trace the impact created by entrepreneurs on their communities, their ability to grow their skills, create further employment and the total contribution of the business towards economic growth. Progress has been noted from a few of the businesses that have used the tool kit and positive feedback has been received by established businessmen, who believe that the business tool kit will assist them in furthering the success of their business.”
The business tool kit, accord- ing to Mseleku, will assist in providing an employment opportunity to individuals who have been retrenched, and are unemployed, as well as to students who cannot afford further tertiary education.
Ascci has an in-house training programme, where individuals are trained and receive accreditation and certificates. A further advanced learning course is also available from the Seta, where skills training can also be obtained.
Further employment opportunities have been created as the Ascci trainers receive specialised training in order to conduct the in-house training programme in centres around South Africa. Ascci hopes to grow the training programme throughout Africa, where local trainers will be employed.
Mseleku says that Ascci’s objectives include distributing five- million business tool kits in Africa over the next five years to affect five-million lives and thus shape the entrepreneurial culture of the continent. “We want to create employment and grow the economy. This will directly assist in dealing with issues such as poverty alleviation and create employment and security, which will allow easier access to education for children and gradually eradicate ignorance. Access to medical treatment will become affordable and diseases in Africa will be combated. This further contributes towards stabilising the economic growth in countries,” he adds.
Projects and Challenges
Ascci hopes to establish a financial institution to assist small business. “Many countries in the world, including Vietnam and Thailand, have successful SMME banks. These countries provide finance and assist in ensuring that all financial respons- ibilities are adequately managed. If a business is financially unstable, an expert is used to assist in identifying and eliminating the problem.” He continues, “ In Africa, there are limited funding opportunities for small businesses and those that do not succeed often do not receive expert financial guidance or the skills required.”
In South Africa, he believes, many financial institutions view a small business as a risk although many small businesses are successful. He says that corporates need to understand the importance of small business and the value of nourishing, growing and preparing a small business to become a success.
Mseleku says that Ascci will discuss plans for the establishment of such a financial institution for the public after extensive research has been compiled into the initiative.
Ascci is lobbying the SADC secre-tariat and various governments in the region for the establishment of the SADC SMME development bank. Ascci is working with Technonet Africa and existing SMME development banks in other countries on the models that would best suit the region. Mseleku says that it is intended that both private- and public-sector investors, including existing banks, will participate in the initiative.
The establishment of a training academy is in the pipeline to develop
skills in South Africa. The goal of the academy will be to assist individuals to start their own businesses and provide training for companies that require specialised skills. The training provided will be ideally suited to each client’s requirements to address specific needs in the workplace.
Mseleku says that more effort is needed at secondary and tertiary education levels to promote business skills. “One is not taught business skills at school and starting a business is not a career option that is regularly promoted in favour of seeking employment or further- ing your education. It is imperative that in a country where more that 50% of matriculants who attain exemptions and do not receive acceptance into university or find employment are provided with business skills that could help them start a business. Further, unemployed graduates do not consider starting a business and Ascci aims to change this mindset,” he comments.
A concern for South Africa, however, is that there is a trend towards developing specific skills in certain fields, he points out. He says that adequate research needs to be conducted into skills required in the market, which industries and sectors are growing, what skills are needed and what levels of competence are required.