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Business Landscape

Security Today is our Protection Tomorrow

Know how to protect your business, yourself and your employees against crime.

Bob Power

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DangerZone

It’s unfortunate reality that because of the high level of crime in South Africa, it’s imperative that SME owners know how to protect their business, themselves and their employees against crime.

Recent surveys have highlighted the following factors:

  • Crime is the biggest worry for SMEs, especially in  the sectors of retail, transport (garages), corner cafes and in emerging businesses in previously disadvantaged areas;
  • At the present time, there is little confidence about any progress of relief for the future. Many do not see any decrease in crime levels over the next year and a third expect crime levels to rise;
  • Burglaries and robberies are the most prominent crimes affecting SME owners;
  • In one survey, 54% interviewed had experienced one incident of crime in the past year, 31% twice and 20% three times; with
  • The main target being cash and saleable goods

The really bad news is that many have limited or no security systems, mainly because of the expense involved, and many do not have insurance cover. Also, although the actual figures are not known, most reported crimes were only made by those who had insurance cover and needed a case number so that they could claim on their insurance. So the correct figures will never be known.

In the upper market areas, although systems were often in place and the owner had insurance cover, the level of crime was still high because the pickings were much greater and the criminals were taking more risks, especially in retail stores and jewellery shops.

The negative psychological impact of exposure to crime was very evident amongst those surveyed, noting that trauma and stress cannot be measured of course.

What can SME owners do?

The following points are a guide line:

  • As a business owner, foster better communication with your local police and insist on a follow up by the police;
  • Keep in touch with your local neighborhood watch;
  • Have a good relationship with other owners nearby;
  • You must know your nearest police station, hospital and fire station and importantly know how to contact them;
  • Always be alert and aware of persons in the vicinity of you premises;
  • Don’t let persons into your premises without knowing who they are and ensure that they are escorted;
  • Don’t have trees, shrubs blocking entrances, windows, fencing etc;
  • Try to get finances to assist you with getting systems such as guards, alarms and especially insurance cover in place;
  • Report crime even if the perpetrators are not found;
  • Don’t keep cash on your premises, lock it away;
  • Have a clean desk policy;
  • Watch danger periods and protect your staff going to the banks, change their routes etc;
  • Don’t leave staff alone at night time;
  • Beware of persons looking for jobs;
  • Don’t leave brief cases, important documents etc in your car;
  • Check out your staff carefully before employing them, with proper background checks – they may be in league with criminals;
  • Employee relationships are vital – create a positive work place and lead by example;
  • Ensure your premises are totally secured at night time, weekends etc;
  • Have good lighting in and outside your premises;
  • Do you prosecute staff who steal? There are many reasons for saying no, but I believe that the right course of action is to prosecute. However, you must go into court  with clean hands. In other words, if you yourself are breaking the law – and your staff know – it could prevent you prosecuting, otherwise they will report you as well;
  • You have an obligation to protect your staff and their assets;
  • Make sure your fire extinguishers are in order and you have first aid equipment available;
  • In buying a SME, a security due diligence is necessary – has the seller kept to the law etc.

Understanding threat situations

With regard to specific offences the following points are relevant:

1. Robbery/Hi-jacking situation

  • Often the criminal is armed
  • Accept their requests – do not argue
  • Don’t try to negotiate
  • It is imperative to identify the robber in one way or the other – such as language, names if used, weapons being used, kind of vehicle escaping in
  • Do not activate alarms unless it is really safe to do so
  • Deal with the persons in stress-get help
  • And always follow the DETAIL code:
    • DRESS – what was the robber wearing
    • ETHNIC COLOUR – Skin, complexion
    • TALLNESS AND BUILD – Skinny, fat, tall, thin
    • AGE – Mid 20s etc
    • IMPERFECTIONS – Limp, scars, speech
    • LOCKS (HAIR) – Length, wavy, clean, dirty

2. Shop lifting

The increase in shoplifting is a cause for concern. Small shop owners must get professional advice – such as lighting, mirrors, searching etc.

To the small business owner, you don’t want to be a victim of security – precautions are necessary, so put them in place. Get training and learn from others experienced in fighting crime.

Having your own business can give you great rewards, but one of the dangers is crime. Learn how to deal with it, it will be to your advantage.

Bob Power is the owner of Power Corporate Consultants and an expert on buying and selling a business, amongst other things. He is also the author of Let the Signer Beware and How To Buy a Small Business.

Business Landscape

Doing Business From Your Home, What Are The Insurance Implications?

Whether you run a small business from home or have a secondary home industry to supplement your income, it is critical to consider all the risks that your home business is exposed to in order to ensure that it is sufficiently covered.

Tarina Vlok

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Besides the standard damage risks of fire, water, and theft, that all policies should cover, people who run commercial operations from their home need to consider a number of other risks that may not be covered by their personal lines policy. These typically include:

1. Business contents

While most home policies will cover basic computer equipment and home office furniture, these policies will usually not cover stock, tools of the trade or machinery. People running business operations from home also need to consider risks relating to their computer equipment (especially if they remove portable equipment away from the premises), and the software related to their business.

2. Manufacturing risks

Any business that involves manufacturing or requires the use of flammable or dangerous materials, must be specifically insured under a commercial policy.

3. Employee theft

While “theft” is likely covered by a personal lines policy, it is important for home business owners to be aware that any theft or fraud committed by their employees will likely not be covered by a home policy.

4. Liability risks

Liability risks that are not insured against, such as a visiting client tripping and falling at the private home from where you operate your business, can have a massive negative impact on your financial health.

Related: Insurance For Small Businesses: What Should Be Covered?

5. Professional indemnity risk

Anyone who offers professional services or advice could be held legally accountable and it is therefore important to be covered for this risk under specialist commercial liability policies.

6. Products liability

If you make foodstuffs or manufacture cosmetic treatments from your home, you will likely require a commercial policy which is structured correctly to ensure that you have products liability cover.

7. Load shedding

Many home businesses need to consider the risk of business interruption due to interrupted power supply, as well as the potential power surges which can cause serious damage to any electronic equipment once the electricity supply is turned back on. Typically, these risks are limited under most home insurance policies.

8. Vehicle use

It is also important to read the terms, conditions and exclusions of your personal lines motor policy carefully to determine whether any vehicle you use for your business operations (to make deliveries or visit clients, for example) will be covered under the terms of your policy. It is extremely important to disclose to your insurer whether your vehicle is used for private purposes, or whether it is used for commercial purposes.

At the end of the day, when running any type of commercial operation from your home – regardless of the business’ size or nature – it is best to talk to a broker or your insurer to ensure that your policy (whether it is personal or commercial) covers the risks that you do not have the resources or appetite to  cover yourself.

Home business owners that are looking to upgrade their level of cover should do their research and find a suitable product that can grow with their business. The Old Mutual Insure product provides a comprehensive package that can be tailored to the insured’s specific needs. The insured can decide how much they can afford and add cover as the business grows. While the product is not specific to small home businesses, the advantage is that the policy will remain appropriate as the business grows and the needs of the insured changes.

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Business Landscape

How Black Umbrellas Is Thriving Through The Challenging Business Landscape

Even against the challenging economic climate, it is very encouraging and impressive to see growth by our clients and their businesses growing to being sustainable businesses of the future, explains COO Emmanuel Mdhluli.

Black Umbrellas

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Vital Stats

As an enterprise and supplier development incubation organisation, Black Umbrellas partners with the private sector, government and civil society to address the low levels of entrepreneurship in South Africa.

“The programme focuses on promoting entrepreneurship as a desirable economic path and nurturing 100% black owned businesses in the critical first three years of their existence through the provision of our nationwide incubators,” explains Emmanuel Mdhluli, Chief Operating Officer at Black Umbrellas.

“Our model is aimed at supporting emerging and existing black businesses through a three-year incubation programme, so that they are able to emerge as independent, viable businesses. By providing a structured and highly subsidised programme, using a national footprint of business incubation offices, clients are afforded the expertise, office infrastructure and resources to create the necessary foundations to achieve sustainable businesses.”

Currently, BU has eight incubators in Cape Town, Johannesburg, Pretoria, Mooinooi, Lephalale, Port Elizabeth, Durban and Richards Bay.

Client insights on Black Umbrellas’ tangible impact

Here are four examples of the direct impact BU has made to each of its selected clients including their turnover, net profit/loss, net asset value and number of jobs created:

large-table

Related: How The Black Umbrellas Programme Can Boost Your Local Black Business

Black Umbrellas currently has clients in various sectors, including:

  • Construction
  • Industrial engineering
  • Pharmaceuticals
  • Oil equipment
  • Services and distribution
  • Consulting and advisory
  • Electricity
  • Telecommunications
  • Healthcare.

“Even against the challenging economic climate, it is very encouraging and impressive to see growth by our clients and their businesses growing to being sustainable businesses of the future,” says Emmanuel. 

Black Umbrellas’ Collective Impact

The collective SME turnover grew by 33% year on year from R2bn to R2.66bn. Job creation and preservation also saw solid growth of 15% on a year on year basis from 10 137 to 11 687 total jobs created since inception. For the year under, BU was able to remain operationally efficient with the average cost per job figure deteriorating by only 12% on a year on year basis from R32 286 to R36 262 at the end of the financial year. Despite the drop, this figure is still extremely competitive and is testament to the continued operational prudence employed within BU to ensure that capital and resources are optimised for greater impact.

“Most enterprise development service providers focus a lot more on financing mechanisms, whereas Black Umbrellas focuses on all aspects of enterprise development that are inclusive of business management training.” – Client Testimonial

What’s next for Black Umbrellas?

Over the past 5 years, Black Umbrellas has observed a growing trend by corporates to develop their own ESD programmes internally in order to fulfil their requirements. Being that ESD is not core business for most corporates, these organisations have tended to reach out to Black Umbrellas to seek guidance and advice for their internal programmes.

This culminated in the formation of Nextgen Consulting which was officially registered in November 2017. Nextgen Consulting offers Advisory services focused on B-BBEE and Supplier Development at full market rates to corporates, Qualifying Small Enterprises (QSE) and generic companies.

This is an exciting project that will see our third year and graduate businesses benefit from an opportunity to expand their businesses.

Black Umbrellas Contact Details

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Business Landscape

Why You Need To Use NDAs To Protect Your Business

Don’t think of them as aggressive – instead, think of nondisclosure agreements as a fast-track toward trust.

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I’m a small-business owner, and we’re in a stage of growth. Do I really need employees and potential partners to sign NDAs? – Chris P., New Jersey

There are many big-business practices that don’t necessarily apply to smaller companies. When you’re a start-up, you can cut a lot of red tape without worrying about repercussions. The use of NDAs – that is, nondisclosure agreements, which serve as legal contracts of confidentiality – is not one of those cuttable corners.

Chris, here’s a cautionary tale of my own early ignorance. When I started Pen Name Consulting, I used a basic NDA – just a file I found on the internet. I wasn’t blind to the importance of NDAs, but I was cheap and stubborn, even though my father is a lawyer and advised me against this move. (He eventually became my general counsel.) My NDA was flawed; it didn’t cover enough of the information at my company or place the right restrictions on how people could share it.

I discovered my error after a business meeting, where I mentioned a potential client and what they needed help with. The person I was meeting with (who signed my weak NDA) then went after that client themselves – ultimately stealing work from me. There was nothing I could legally do. It probably cost me $30,000 in potential revenue.

Don’t make my mistake. Creating a strong NDA for your business is simple and not that expensive. Even if you enlist the best lawyer, with a ridiculously high hourly rate, the value you’ll receive to protect your company and your ideas is arguably worth the potential value of the company itself. Or at least the value of one client.

Related: Understanding the Terms of Agreement

Now, I understand that it can be awkward at first to ask people to sign an NDA – it seems like you’re telling them you don’t trust them. But think of it this way: If you don’t value your IP, your thoughts and your inventions enough to protect them, then why the hell are you running a business in the first place?

An NDA doesn’t have to feel like a sign of distrust. Because of the scrappy nature of startups and small businesses, partnerships and strategic hires are the lifeblood of scale and smart growth – but they’re also rife with danger. Every potential partner is also potential competition. Every meeting for growth could be a leg up for the other guy. And every time you share your next big move, you need to know you can trust people.

NDAs are valuable because they force that trust. They make it legally binding. With the NDA in place, you can be vulnerable, open up and speak more candidly with potential partners. Rather than view the NDA as a barrier, it’s best to look at it as an exclusive invite.

This is a good thing – the NDA is the front door to learning more and being on the inside. The same can be said for hiring. The moment you have a signed NDA, you’ve connected with someone and you’ve closed the deal. It’s a sign of respect. And when you have respect, you have strong partnerships and hires. That is the foundation of growth for any business.

Pride and ownership are big parts of owning a company. If that comes across as a little “preachy,” it’s because you need to bear witness to a simple reality: Those who do not invest in protections for their business are likely to watch it fall apart. Or they will be too guarded with information to ever let others in. Either way, an NDA solves those problems.

This article was originally posted here on Entrepreneur.com.

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