Thursday, October 10, 2013

Elias Mnyandu, Editor Business Report, SACCI Convention 2013

Elias Mnyandu, editor business report
SACCI Convention 2013

reflect issues facing our country
Africa is on the move, let's get down to business

South Africa in the age of resurgent Africa

president zuma says South Africa is a special place
bordered by two oceans
triumph of human spirits

South Africa is the only country in Africa that has Africa in its name

1 million readers. with social media, the media industry is turned upside down

We are in an age of experimentation and change

we are witnessing history in the making
there are immense opportunities for us to impact
We either embrace change, or become irrelevant and die

The potential of South Africa lies in its people.
heartening to see close the gap in infrastructure on the continent
private sector will play a bigger role in infrastructural development.

Nearly half of the continent faces water scarcity

Technology: increase broadband penetration by 10%
Africa has enormous arable land

Mauritius is the only African country to rank in the top 50 in terms of maximising human resources

Chinese proverb says a man is most tired when standing still

WEF human capital index






Elias Mnyandu, Editor Business Report, SACCI Convention 2013

Elias Mnyandu, editor business report
SACCI Convention 2013

reflect issues facing our country
Africa is on the move, let's get down to business

South Africa in the age of resurgent Africa

president zuma says South Africa is a special place
bordered by two oceans
triumph of human spirits

South Africa is the only country in Africa that has Africa in its name

1 million readers. with social media, the media industry is turned upside down

We are in an age of experimentation and change

we are witnessing history in the making
there are immense opportunities for us to impact
We either embrace change, or become irrelevant and die

The potential of South Africa lies in its people.
heartening to see close the gap in infrastructure on the continent
private sector will play a bigger role in infrastructural development.

Nearly half of the continent faces water scarcity

Technology: increase broadband penetration by 10%
Africa has enormous arable land

Mauritius is the only African country to rank in the top 50 in terms of maximising human resources

Chinese proverb says a man is most tired when standing still

WEF human capital index






Elias Mnyandu, Editor Business Report, SACCI Convention 2013

Elias Mnyandu, editor business report
SACCI Convention 2013

reflect issues facing our country
Africa is on the move, let's get down to business

South Africa in the age of resurgent Africa

president zuma says South Africa is a special place
bordered by two oceans
triumph of human spirits

South Africa is the only country in Africa that has Africa in its name

1 million readers. with social media, the media industry is turned upside down

We are in an age of experimentation and change

we are witnessing history in the making
there are immense opportunities for us to impact
We either embrace change, or become irrelevant and die

The potential of South Africa lies in its people.
heartening to see close the gap in infrastructure on the continent
private sector will play a bigger role in infrastructural development.

Nearly half of the continent faces water scarcity

Technology: increase broadband penetration by 10%
Africa has enormous arable land

Mauritius is the only African country to rank in the top 50 in terms of maximising human resources

Chinese proverb says a man is most tired when standing still

WEF human capital index






SACCI president Clive Manci speaks, SACCI Convention 2013

SACCI president Clive Manci speaks.
SACCI Convention 2013

Believe a lot can be done.

Focus on education, reduce cost of doing business

SACCI plays an active role in BBBEE codes of good practice. Believe can achieve this without additional cost of compliance

MOU designed for businesses to engage with governments of all levels

Challenging labour environment, SACCI raises issues with labour minister.

untenable:
intimidation by striking workers
protected nature of industrial action
adversarial statements arising from industrial action. not conducive to job creation.

We need to ensure abiding by the provisions of law.

Advocacy into 2014, need for SA to become an attractive investment destination

As we take on 2014, SACCI seeks to pursue 5 strategic areas, with the theme of driving investments to grow SA economy

1. Clear policy direction, through NDP
2. work with like minded organisations, like brand SA
3. work with DTI to reduce cost of doing business

Wednesday, October 9, 2013

Business Partners, Leading Investor in SMEs, SACCI Convention 2013


Business Partners
Leading Investor in SMEs

David Morobe, Regional General Manager
SACCI Convention 2013

Economic trends & discontinuities
Global
Africa - booming economies; is the 21st century the dawn of Africa era?
South Africa:
  • fragile recovery from the 2008 GFC and 2009 recession
  • vulnerable to European economic malaise and slow growth in North America (which, together accounts for >50% of SA exports)

Overview of the SA SME market
1.5 - 2 million SME and SMMEs operate in South Africa
Confidence level: 35% extremely confident

Business Partners is a specialist investment group, providing finance and mentorship for small and medium enterprises in South Africa. Now growing to English speaking parts of the continent
A risk financier, founded in 1981 by Anton Rupert
31 offices around the country
300 to 600 investments per annum in SA

Offers:
Financing
Mentorship
Property finance and management
Manage funds

69,000 businesses financed
R12.5bn rotated
R1bn finance available

The target market:
Mainly family owned, SME
E.g. Wimpy franchises, manufacturing plant

Procedures we follow:
  • work in small teams
  • Do proper due diligence
  • Prepare an approval report
  • Committee decision
  • Implementation follow
  • Post investment action

Viability based financing:
Focus on business
Entrepreneurial ability

Business Partners Venture Fund (R400 million)
Early stage investments, after research
investment period: normally 5 years
Exit strategy: preferably trade sale

Buying vs renting:
Decide to buy own premises
Normal bank principals
Entrepreneur has no deposit
can lose opportunity

Normally bank will require 30% deposit, Business Partners fund 100% of building. By year 4 to 5 break even

Investment capital of between R500,000 and R25million

George, lab doing tests for foodstuffs

Property investments: R787 million with 2,000 tenants

Graduate internship program
Schools entrepreneurship program
SME Tool kit
Business Mechanics and home website

Deal generation:
accountants, bankers, brokers, consultants, attorneys, agents as intermediaries 54.5%
Existing clients 36.3%
Marketing action 9.2%

What makes us different?
The approach
Personal contact
Funding flexibility

SACCI Convention 2013, Productivity SA


Productivity SA
SACCI Convention 2013

Vision
Our vision is to lead and inspire a competitive and productive South Africa.

Mission
To improve productivity by advising, implementing, monitoring & evaluating solutions aimed at South Africa”s competitiveness

Stages of interventions:
Emerging
Stable
ICU

Productive capacity building SMME Programme:
Business start-up training, partnership with SETA, funding by DTI
Business improvement workshop
Coaching and after-care programme, incubation projects

October is the month of productivity in South Africa

Customised capacity building approach - SMME

Scoping - business analyst measuring
Determine baseline
Design proposal/indicate cost sharing/benefits
Sign agreement/MOU/implementation plan
Phased approach/early warning methodology
Showcase outcome/lessons learned

Partnerships are key, cooperative developments

Schools programme:
Principal training awareness

Productivity awareness & advocacy

SACCI Convention 2013, A new take on tech in the SME Journey, Vodacom

A new take on tech in the SME Journey

Vodacom Business
SACCI Convention 2013#sacci2013

Concerns on education
Focus on SME by Vodacom

  1. Moving with the times

Running a small business is no easy fate
Business a few years ago was easier
Now clients become more sophisticated, need for robust ICT solutions. One size doesn't fit all
Each business has different IT needs

  1. Taking on the journey together
Analogue to digital
Buzzword now is cloud computing
Voice messaging
SMEs look for partners to develop and implement technology, Vidacom vie to become virtual CIO to small businesses
23% people use own device to work
32% of people routinely check email before going to bed

SME connectivity: First Mobile PABX, virtual switchboard, mobile and fixed convergence
Vodacom One Net Express
011 seen as bigger business

SME transformation:
voice
mobile email and mobile applications
data
fixed solutions
convergence 
unified telecommunications
cloud - getting solutions from the cloud
MS office 365 solutions, SAP

Vodacom Business Product stack:
Converged comms
Machine 2 Machine

  1. Evolving with the SME environment
SME starter
SME Business Progressor
SME Business Accelerator

Business applications: CRM ERP, Fin, HR

SACCI Convention 2013, Make Business Growth Happen, Nedbank

Make Business Growth Happen
Adrian Dubru Nedbank
adriandub@nedbank.co.za
Tel 011 294 0050
simplybiz.co.za

Focus on:
start-up business
franchises
Profesional entities
Established businesses

Challenges faced by entrepreneurs:
Access to markets
Financial acumen
Business formalisation - close to 1m SMEs in South Africa, but most not in formal sector - to run business finance separate from personal finance
Access to support services
Lack of collateral

Business constraints:
Crime and corruption 47%!!!
Fear of failure 38%
Electricity issues 15%
Access to finance 7%
Inadequate skilled labour 6%
Labour regulations 5%

Nedbank's approach:
The centre as your business
Bank and Transact
Finance your business
Invest and protect

Nedbank's philosophy
A focused client driven approach
We understand the unique challenges
A credit philosophy aligned to your focus
Service efficiency and excellence

Small Business Friday 6 Sep 2013 - focusing and supporting local businesses
It's my biz flighted on eTV, creating awareness
Mobile app to help people find businesses on the map, simply register business on simplybiz.co.za, don't have to be a nedbank business client
PocketPOS app on mobile device, need cellphone signal, enabling e-commerce, process transactions while moving - card transactions

Finance options:

Short term - working capital, debtors, stock, overdraft facility, debtor finance, guarantees

Medium term:
  • Fixtures and fitting
  • Renovations of premises

Long term:
  • Property finance

SACCI Convention 2013, Supplier Management by Ntabiseng Dube, ABB

Supplier Management by Ntabiseng Dube, ABB
SACCI Convention 2013

ABB Quality Policy
ABB an electrical engineering company based in Zurich. ABB SA 80% owned by ABB Group and 20% by Wiphold

Supplier Process:

  1. Supplier identification
  2. Qualification - company management, sustainability, product / process design, operational excellence, continuous improvement, costs. If score is above 50%, put on a development programme; if 80%, then onboard
  3. Onboarding - onboarding form to complete, mandatory info: BBBEE, tax clearance, bank details, company reg.
  4. Performance evaluation: to evaluate suppliers, to supply to ABB around the world.
  5. Classification - FLOP 10 worst of the worst, cost of poor quality (COPQ)
  6. Development, or de-sourcing

Advanced Supply Chain Collaboration (ASCC)

Opportunities to building a strategic partnership:
turn key solutions
Leveraging

Neels de Jager: Country Supply Chain Manager
neels.de_jager@za.abb.com
Tel: 010 202 6066

ABB has lots of programmes, serving Southern and Central Africa
Solar, green projects
Education, FET colleges, take students to premises to expose them to technology, even working with lecturers to impart the right knowledge

SACCI Convention 2013 - Neotel and SME development


Neotel and SME development
SACCI Convention 2013

SA economy R1.6 trillion
SME account for 34% of SOuth Africa's GDP
The internet economy: a 10% increase in internet penetration leads to a 1.3% increase in GDP

Neotel's contribution:
Metropolitan networks 8500km
National long distance 15,000km
Fibre, Wimax, LTE in Gauteng
Neotel LTE specifically targeted for SME
Neotel academy - full SETA accreditation, 12 month programme with option for extended training
N2 education hub

SACCI Convention 2013 - Business in a New Africa Paradigm


SACCI Convention 2013

Business in a New Africa Paradigm
by Sisa Sishona, ABSA
SA spends the highest dollars on education on the Africa continent
Education a key driver, but education system has failed
Lowest results in numeracy ability in Africa

25% unemployment rate

Tax base:
15 million citizens on welfare, but only 6 million taxpayers - unsustainable

Amendments to BBBEE scorecard - 2013
Consists of 
ownership 20%
Management (Board/Exco) - consolidated with EE
Employement equity 15%
Skills development 15%
Preferential procurement 25%
Enterprise development 20%
Socio-economic development 5%

  1. Compliance elements reduced from 7 to 5
    1. Introduction of priority elements - ownership, skills development etc
  2. EME increased to R10m turnover p.a. - default Level 4 100% contributor
  3. QSE R50m
  4. Fronting to be a criminal offence - 10 years imprisonment

Is BBBEE relevant?
 South African context:
poverty and unemployment
education
localisation

Europe - Africa's primary trading partner
SMEs are among the major drivers of the economy
Top 4 economies in the world share a passion for entrepreneurship: US, China, Japan and Germany
SMEs drive innovation and productivity
SMEs employ in excess of 60% labour force in SA

Africa window of opportunity:
Booming population - electricity need
Rising incomes
Rapid urbanisation
Opening trade

Demand will create itself
The Economist: the changing sentiment: The hopeless continent in May 2000, to Africa rising in Dec 2011
Does SACCI have network with other chambers of commerce in other African countries?

Intra-Africa Business: low and slow, more likely to find Kenyan products in London for example
Need to remove visa barriers and infrastructure challenges

Addressing the three key challenges of small businesses
  1. Access to Markets - if have a certain market, the money will find you
  2. Access to Funding - each province has its own development agency
  3. Access to Business Support

Do not have an entrepreneurial culture in SA - rather study, work your way up, and become an important person one day
Banks traditionally want collaterialised lending. But many people have no assets, on the other hand also need responsible lending
People who are technically good are lousy businesspeople.

ABSA Procurement Portal: A virtual market place for SMEs and Corporates - supply chain network, to be launched in January 2014
Big businesses want to do business with SME, but can't find them
12,000 SMEs onboard at the moment, want to grow to 100,000

Access to markets, makes SMEs visible; company information
Buyers can advertise tenders
Suppliers receive notifications of new tenders by E-mail
Access to Non Traditional Funding, to bridge the gap, as government pays eventually, in 6 months
Australia has strict 30 day policy to pay SMEs
ABSA offers procurement finance

Why small businesses fail:
34% poor financial management
16% lack of management competence
12% poor book keeping and records
11% sales and marketing problems

ABSA offers access to non-financial support:
ABSA entrepreneurship centres, with access to computers, softwares and coaches

Globally, businesses are started by 3F's: families, friends and fools!!!
Venture capital or equity lending is in short supply in Africa. Stellenbosch is such incubator