Start-up goal: capture continent
issue is while planned expansion can take a business to a whole new level, over-expansion is a big danger of a growth phase. It’s easy to get carried away and to expand beyond the needs and the financial capacity of the business.
As a rule of thumb, plan capacity based on a five-year projection of demand and allow an additional 10 percent capacity for heavy demand or partial down-time.
Remember, a business may go through several periods of expansion and it’s best to phase these according to demand. Don’t try to account for
Whatever the nature of the expansion, there are financial implications for the business and it is often best to seek professional advice.
For example, if a small-business owner needs to build or purchase premises, it is advisable to speak to a financial institution that has experience in this area before applying for finance. Business owners should make sure to not over- or under-borrow from a financier.
For equipment, the businesses may also need to consider a flexible financing option, either a loan or a combination of a loan and an equity investment. Again, consulting an institution with experience in the
“Most of the projects that we have to pitch to the government will be handled by her,” he says.
The company is also mentoring UJ second-year marketing student Moshe Ndlovu to become their marketing manager when he finishes his studies.
“We are pushing the young ones because part of our Pan-african vision is to uplift other black academics. For us to rise, conquer and be liberated, we need to uplift each other,” says Mosiedi.
“Young black Africans need to start their own businesses. There are lots of graduates but few companies are employing them. We must start building our own African empires.” field and in your own industry is essential.
As a wise veteran of business once said, “once the money’s spent, it’s spent – and there’s no going back”. A major expansion is a bit like buying a house – one of the biggest financial commitments you will ever make. Decide on what you are looking for and shop around for the best quality and price. This can take a bit of time and attention, but it is worth the effort.
The economy might indeed be showing signs of recovery but it is important not to miss the proverbial boat. Planning is critical or else businesses can land up in an economic whirlpool with dire consequences.
Bierman is managing director at Business Partners Ltd.
The young entrepreneur, who is a member of the South African Institute of Tax Professionals, is currently studying towards an advanced diploma in accounting science at Unisa.
He says one of his proudest moments was being crowned the Kagiso Young Entrepreneur of the Year at the first Kagiso Achievers Awards in 2017.
Running the business has been a roller coaster ride for him.
“There have been ups and downs, but it has been a nice process and journey. I’ve learnt a lot because everything we’ve done has been selffunded. We’ve faced many budget constraints.”