Small businesses battling
LACK of government and private sector support is having a detrimental effect on Durban’s small businesses which, despite holding significant keys to job creation and economic growth, are seeing increasingly high failure rates.
Corruption and favouritism in the government sector are also major hurdles, Durban entrepreneurs say.
The most recent Global Entrepreneurship Monitor: South Africa report stated that entrepreneurship in the country was on the decline, with major constraints cited as the burden of government policies, access to finance, and quality of education and training.
Award-winning Durban entrepreneur Grant Gavin, who has business interests in property, business coaching and public speaking, and is founder of the Durban Entrepreneurs’ Club, said this finding was “worrying”, considering the impact that positive trends in entrepreneurship could have on the local economy”.
“The government needs to find ways to promote, encourage and support entrepreneurship…
“The failure rate for small businesses is high, and the main reasons are entrepreneurs’ inabilities to generate new leads into the business, the inabilities of owners to access finance, and the lack of research on establishing demand for the product or service at the outset.” Gavin, who is also a member of the Durban chapter of the Entrepreneurs Organisation, added that Durban had a lack of business events and so the vision for the Durban Entrepreneurs Club was to provide local entrepreneurs with access to education, training and networking opportunities.
Akhona Mahlati, principal strategist and executive director at Ewe Sana Marketing and Communications, as well as a business owner and operator in Gauteng, KwaZulu-Natal and the Eastern Cape, said one of the “toughest challenges” was for black entrepreneurs to break through and become players in predominantly white business circles and markets which “aren’t used to working with high-quality business people of colour”.
He also said working with the government sector had been an “ongoing challenge”.
“The levels of corruption, and the patronage which favours very few, are a consistent stumbling block.”
For women entrepreneurs in Durban, Cindy Norcott, owner of Pro Appointments, said there were some advantages, with one of them being that the city had a variety of women-only networking groups which were “excellent”.
However, there were also some general entrepreneurship challenges, including that very few head offices were based in Durban, resulting in very few local decision-makers.