The South African economy is ripe for anyone interested in undertaking a Small, Medium or Micro venture (SMMEs) and running their own show; but as many people want to know when considering their own start-up, what are your chances of success?
Excellent, provided you take the proper steps toward ensuring your business is well planned out and cover all your bases as far as any legalities and reporting policies you need to adhere to.
In all, SMMEs are very well received in South African, where it’s currently noted that these ventures are responsible for approximately half of the country’s gross domestic product; on top of that, businesses of this size make an enormous contribution toward employment.
With more than 1.5 million entrepreneurs and small business owners involved in the South African business scene, studies have found that these ventures generate approximately 40% of all wages paid and are expected to have an enormous impact on the creation of new jobs over the next several years.
It’s an exciting picture, and one that’s very tempting to get involved in; if you have any entrepreneurial inclinations, the thriving South African business landscape can seem like a utopia of growth and success.
But do you have what it takes to run a successful business?
The following is a list of four key preliminary actions to take when deciding whether or not to jump in with both feet and start the venture of your dreams:
Is Entrepreneurship for You?
Entrepreneurship is undeniably hard-core, from the pressure to innovate to the stress of lacking a steady income and the demand for marketing your services and generating adequate revenue to pay your suppliers and loyal employees; it takes a special breed to handle the headaches with aplomb while continuing to build with both logic and passion.
Think about how entrepreneurship would change your life; while there are many people who speak of running your own business as ‘being your own boss’, that couldn’t be further from the truth if you’re running an enterprise where you’re accountable to a board of directors and/or responsible for meeting a payroll.
Take a hard look at your personality and evaluate your strengths and weaknesses; there are a number of online quizzes designed to measure the degree to which you’d find entrepreneurship suited to you, take some and see how it comes out.
Do Your Research
While having a great idea for a business is a great first step, it’s not always that simple; wanting to open a coffee shop in a city where there are already 3 coffee shops per square mile or wanting to become a sheep shearer in a city where there is nary a sheep in sight is going to make your revenue generation tricky.
Be sure to do your research as far as what ventures are going to have the highest chance of success; it’s essential to do a comprehensive business plan and ascertain not only who the competition is and how they’ll affect your chances of success but what the market demand is going to be for the services you’re offering.
With high competition and very little demand, your chances of success are not necessarily stellar.
Decide what you Can Invest
From start-up fees to prelaunch expenses, inventory and asset costs and long-term fixed assets, chances are you’ll have to shell out a fairly significant investment before things can get rolling.
Take the time to integrate expenses and cash flow projections into your business plan so you have a full understanding of what you can expect going in; above all, when doing your projections, beware of hidden costs, from attrition to late fees on supplier invoices and/or bank fees, there are myriad hidden expenses that need to be accounted for when assessing a potential venture.
See a Professional
Once you’ve done your research be sure to get a second opinion; there are many resources throughout South Africa and many of them are committed to assisting entrepreneurs in launching successful and sustainable businesses.
One example is the Branson Centre of Entrepreneurship, started by world famous entrepreneur Richard Branson of Virgin Mobile success; the centre offers a variety of venture-related services from practical skills training to networking opportunities and business coaching.
But above all, the Branson Centre offers a solid, ideas-oriented environment for entrepreneurs like yourself to come together in an effort to breed success and taking your idea and your research to them can help you get a professional opinion on your findings as well as a supportive platform for your future success.
There are a few steps to take when deciding whether starting a business in South Africa will be right for you; starting your own business takes a passionate commitment to developing sustainable solutions to specific problems in a way that will generate revenue.
One thing is very clear, however; if you’re looking to start a new venture, the current South African business economy is the right place for you.
For help with getting your business registered, logo design, business cards and websites all in an affordable package please see our Start your own business packages