Summit to address challenges facing SMMEs
The SMME Foundation and LSM Communications in partnership with NMT Capital will on 30 – 31 July 2019 host the 2nd annual SMME Sustainability Summit at the Joburg Theatre. The Summit is aimed at promoting the growth and development of SMME’s and to help them contribute to economic growth and job creation. It attracts entrepreneurs from across the country, and also brings together Development Finances Institutions (DFIs), business pioneers, industry experts and mentors to have an exchange on how to assert the role of SMMEs’ as catalysts for economic growth and job creation.
SMMEs are considered the backbone of most economies and a contributing factor to gross domestic product. Even in South Africa, SMMEs constitute a sizeable number of all businesses. According to South Africa’s first baseline study on SMMEs, 98.5% of all registered businesses in the country were SMMEs and yet they created only 28% of jobs, meanwhile 60% to 70% is the international norm. Yet the National Development Plan (NDP) envisions that by the year 2030, 90% of jobs will come from the SMME sector.
Despite this ambitious target, statistics from the Department of Trade and Industry (DTI) suggests that more than 70% of new businesses fail in less than two years. A survey conducted by the Organisation for Economic Cooperation and Development (OECD) and the World Bank titled the Future of Business, identifies the following as the top challenges facing small businesses in South Africa:
- Securing financing for expansion;
- Maintaining profitability;
- Increasing revenue;
- Attracting customers or access to markets.
Director at the SME Foundation Mr Siyabonga Magadla believes that a result of these is that most enterprises in the country remain micro with no prospects of growth, and do not contribute to economic growth and job creation. Owners also leave from hand to mouth diminishing any chance of a meaningful contribution. “The issue of access to markets is also fundamental to business growth because if you cannot find customers or markets for your products and services your business is unlikely to survive”, he says.
“Customer loyalty has also proven that, there are inherent inhibitions in the minds of customers related to a new product or brand in the market, and thus they prefer to go with big names or brands that are established,” he adds.
As a result, the SME Foundation has carefully selected a list of speakers as well as private and public sector institutions whose work has a direct bearing on addressing the challenges identified as facing SMMEs. These include Investment Firms like NMT Capital founded and chaired by Business Pioneer Mr Sango Ntsaluba, who also founded one of the top 5 Auditing firms in the country, SizweNtsalubaGobodo. NMT Capital plays a huge role in the growth and development of SMMEs through social capital, investment and equity. They also have a diverse portfolio of businesses interests including, Construction, Energy, Financial Services, Information Technology, Manufacturing, Mining Services and Real Estate.
Proudly South African will also be present at the Summit particularly to address issues relating to promoting proudly South African products as well as provision of access to markets for SMMEs. The Department of Trade and Industry will deal with issues relating to investment and the promotion of exports for South African products.
Meanwhile, the National Empowerment Fund (NEF), the Small Enterprise Finance Agency (SEFA), the Gauteng Enterprise Propeller and the National Youth Development Agency (NYDA) will be addressing issues relating to financial and non-financial business development support. The Department of Small Business Development has also been invited to come and deal with issues relating to policy and regulations within the sector. Tourism Minister Nkhensani Kubayi-Ngubane will also give a Keynote address where she will outline plans to promote the growth of SMMEs within the tourism industry.