W Cape knows its (small) business

THE Western Cape was a leader when it came to small, medium and micro enterprises (SMMEs), as evidenced by employment statistics, according to Wesgro chief executive Tim Harris yesterday.

The Western Cape employed 2.26 million people, had the lowest number of discouraged workers – people not actively seeking employment – in the country, and the highest labour absorption rate at 53.2 percent.

Harris was speaking at the Western Cape regional conference of the AHI Western Cape at the Pearl Valley Golf and Country Estate, which started on Wednesday and continued yesterday.

The conference focused on the role of SMMEs in tourism, agriculture and the industrial sectors in the province and South Africa.

“Western Cape business employs 2.26 million people but the province has the lowest number of discouraged workers in the country at 42 996 compared to KwaZuluNatal at 562 331 and the Eastern Cape at 424 958,” Harris said.

When it came to micro business, he said about 91 000 people were running businesses in the province with a turnover of less than R1 million a year.

With regard to medium-sized businesses in the economy, Harris illustrated growth by means of an anecdote about a particular “food retailer that started 30 years ago by opening up a stand-alone store, and now generates turnover exceeding R1 billion, employing over 400 permanent staff”.

According to Harris, South Africa ranked 16th in the world for new business density.

The informal sector was also a significant contributor.

“In 2013, of the 1.5 million persons running non-VAT registered businesses, as many as 1.4 million were in the informal sector.

Interestingly, almost 70 percent of people starting their own businesses did so because they could find no other employment. Only 7 percent said they did so as they had the particular skill needed.

About 40 percent of informal business operators said the assistance they most required was with marketing and 20 percent said it was with easing of regulations.