Small business owners will tell you that it’s not easy to do this in the first few years. However, since entrepreneurship is critical to the nation’s economic recovery, we need people who are willing to take risks and start their own small businesses.
“Entrepreneurship has been hailed as the key to South Africa’s economic recovery,” said Claire Klassen, an expert in consumer finance education at Momentum Metropolitan.
According to the 2021/2022 Global Entrepreneurship Monitor (GEM) report published by Stellenbosch Business School, early-stage entrepreneurial activity among South Africans aged 18 to 64 has increased dramatically.
Early on it was defined as “establishing a business” or “running a business for less than three years”. A new wave of entrepreneurship, micro-entrepreneurship and part-time activity is inevitable, Classen said.
“Unemployment in South Africa has risen significantly in the wake of Covid-19, as many businesses have been forced to close or lay off staff. Youth have been hit hardest, as they tend to be disproportionately represented in sectors ravaged by the pandemic, such as services industry, hospitality and retail. Because they have less work experience, they are often the first to go out when companies lay off staff.”
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Small businesses earn income after Covid
However, South Africans are naturally resourceful and earn an income vital to their survival, and many are looking for new ways to make ends meet. Interestingly, she said, the GEM report also assessed society’s attitudes toward entrepreneurship, finding that 81.8 percent of respondents believed entrepreneurship was a good career choice, while 20 percent of non-business people had entrepreneurial intentions.
“While this is encouraging, five out of seven small and medium-sized enterprises (SMMEs) in South Africa fail in their first year. We need enough runway to see tangible economic benefits from the current rise in early-stage entrepreneurial activity. We We’re in a window of opportunity, and it’s make-or-break time.”
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She said it was important to have good financial literacy and an understanding of what was involved in running a business.
“A savings that is essential to cover basic business start-up costs, such as an emergency or ‘buffer’ fund, will help ensure the lights are on in the event of a downturn in your business.”
You can use free online tools that help improve your financial literacy, such as Make It With Majoras, a free zero-data online financial literacy course, the latest version of which focuses on entrepreneurship.
“It teaches key financial concepts that entrepreneurs must understand, such as how to develop a business budget, skills in negotiating with suppliers, and the importance of developing a solid business plan, all in a compelling and easy-to-understand storytelling format. “
Metropolitan also has a Facebook group, Metro KickStarz, dedicated to helping young, budding entrepreneurs through its financial education programs. Aspiring entrepreneurs can join this community, which provides a space for them to interact, share ideas, and gain free access to valuable knowledge and other resources.
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Learn from those who are successful
Klassen recommends that you research similar companies or businesses that have been successful, because it’s important to understand why they work, how they differ from their competitors, and what they do or do not do well.
“Learn more about the founders and study their habits. Do they believe in continuous learning? Maybe some principles or philosophies of their lives guide them.
“Understanding what it involves to successfully start and run a business and the little daily habits that help you succeed can have a big impact on the trajectory of your own business,” she says.