Understand What and How Much To Spend
You need to be in tune with what buyers in a certain area want, otherwise you might end up over-capitalising or creating something that’s out of sync with the rest of the suburb.
For example, you could make a profit from flipping a Golden Oldie in Parkhurst – but the market in this area demands a Chelsea-fied, sophisticated look, so a thatch would never sell.
On the other hand, you’d take a different approach in Brixton. Here, there is a lower price ceiling – you wouldn’t want to spend a lot on the property because you wouldn’t receive a high sales price. It’s best to buy in an area that reflects your culture. Spend time at showhouses to see what styles are popular in an area, and what sells.
Make the Right Choice
When buying a house, it all comes down to location, location, location. You need to purchase the worst home in the best area, because this gives you the room to do your renovations – whatever changes you make will raise the value of the house.
You need to examine the structure of the house to make sure it’s sound. Unless you have experience in making renovations, it’s essential to bring in a professional who will know what flaws to look out for.
You’ll need to do a lot of homework; for example, you have to look up the future plans for the area, because the property may be affected by major arterial roads that are being planned. You also have to submit notice of your own plans for comment.
Reward versus Risk
Remember that the bigger the bait, the bigger the fish you’ll catch. Higher-priced properties will bring the best rewards, but also carry the most risk.
When you’re ready to sell, remember that the first offer you receive is generally the best offer and delay means extra holding costs. Waiting for the market to provide your profit is a costly exercise because even if you get your price you will be re-buying into a higher market.
Enterprise Development Programmes For Black Entrepreneurs
As small businesses in South Africa are recognised as a driving force for economic growth and creation of jobs, enterprise development programmes offered by government and corporates offer black entrepreneurs the opportunity to find support and training to further develop their small businesses.
Businesses serve a critical role in driving more inclusive and sustainable development. Large companies can create positive impact by improving and growing development. Corporates can achieve this by including small business into their value chains and local communities.
Helping small businesses to achieve sustainability and growth is vital for both the development of industries and corporations. Small businesses are critical for job creation, improving living standards, raising productivity and achieving inclusive economic growth and social cohesion.
In the coming years there will be a great demand for jobs and the private sector will be the core to the solution of this challenge.
Many of the new jobs will come out of the small, medium and micro-enterprises, which is why enterprise development programmes are emerging around the world.
Content in this guide
- Junior Achievement South Africa Enterprise Development Programme
- The Women’s Enterprise Development Initiative
- Standard Bank Enterprise Development Programme
- First National Bank – Vumela Enterprise Development Fund
- Nedbank Enterprise Development Programme
- Absa – Enterprise Development Fund
- Tholoana Enterprise Programme
- The Royal Fields and Job Funds’ Enterprise Development Programmes
- Siyakhula Enterprise Development Programme
- National Youth Development Agency (NYDA)
- The Small Enterprise Development Agency (SEDA)
What is an enterprise development programme?
Enterprise development involves the growing of small and medium-sized black businesses through the provision of finance and support, assisting in their business development and sustainability.
In creating a programme for enterprise development, budding entrepreneurs and all they hire will earn a living, which in turn uplifts their quality of life.
These programmes could lead to long term economic growth for entrepreneurs, their families and friends and their entire communities.
The enterprise development programme is just one of the elements of BB-BEE and is considered an effective way to combat poverty across the globe.
Its objective is to teach potential entrepreneurs how to create a sustainable business that will grow and increase job creation, which in turn contributes to economic growth.
Enterprise development programmes ought to be aimed at transferring skills and wealth as well as leading to the sustainable growth of small businesses.
How can you benefit from enterprise development programmes?
Enterprise development programmes aim to pass on knowledge, experience and business support. This aim will provide start-ups with essential tools and resources that can then be used for the development, survival and success of business.
Essential tools and resources can be divided into financial and non-financial support. Non-financial support can be provided in the form of mentorship, market access, network access and the learning of new skills.
80% of South Africa’s start-ups fail in the first three years and this is largely attributed to a lack of support. However, the survival rate of a start-up is increased by the incubation process, which assists small businesses in becoming financially viable.
The Gordon Institute of Business Science (GIBS) and FNB’s Entrepreneurial Dialogues, State of Entrepreneurship in South Africa report revealed that:
“Business incubators assist emerging companies survive and grow during the start-up period, when they are most vulnerable. The incubation process improves the survival rate of start-up companies by assisting them to become financially viable, usually within two to three years.”
The FNB/GIBSs report explains:
“Start-ups fail at a rate of about nine in ten in the first two years of operation. Within the 27 SEDA incubators (in operation), the survival rates are in the region of 84% to 97% in the first two years of operation. Post-graduation from the incubator, the numbers come down but they are still in excess of 70%.”
Why do corporate businesses offer enterprise development?
The B-BBEE Amendments are providing corporate South Africa with an ideal opportunity to construct sustainable businesses and to play a lead role in the socioeconomic transformation of the country.
Investment and improvement in local economies can ensure profitability and economic success for all business around the world.
By offering an enterprise development programme corporates are awarded:
- Points on the BEE scorecard
- An opportunity to diversify their supply chain
- An innovative way to increase business for both small and medium sized enterprises.
It’s an inspiring vision for business to play a real role in the sustainability and growth in the country’s economy.
Here are some of the various types of enterprise development programmes that an applicant could apply for:
Youth enterprise development programmes
The unemployment of youth in South Africa is one of the highest in the world. The steady increase of the youth population is not being matched by an increase in job opportunities. There is a large discrepancy between what the youth are being taught and what employers expect them to know.
Junior Achievement South Africa Enterprise Development Programme
Junior Achievement South Africa is a unique intensive incubator style entrepreneurship skills programme. The aim of this project is to address the unemployment challenge amongst the youth.
This programme provides practical entrepreneurial skills and traditional workplace readiness skills. This will solve the challenge the youth face when entering the job market with insufficient experience.
The programme consists of 20 four hour sessions which runs for three to four months. The students are expected to start running a real business, with the intention that the businesses are sustained after the programme is completed.
Who should apply?
This programme is targeted at young adults between the ages of 18 and 25, who are not in school and are currently unemployed. Participants are chosen based on:
- Commitment to the programme
- Inclination to participate in entrepreneurial activity
- Ability to demonstrate problem solving skills
- Commitment to their personal development.
To contact Junior Achievement South Africa
- Phone: +27 11 331 3150
- Email: firstname.lastname@example.org
Women’s Enterprise Development Programmes
These enterprise development programmes are created to increase the economic opportunities for women entrepreneurs by supporting them in starting, strengthening and expanding their businesses.
Sleeping in his car to keep his business open, losing millions because of one mistake only to earn it all back. Learn from the extraordinary stories of these 10 passionate black entrepreneurs.
The Women’s Enterprise Development Initiative
This is a niche private equity and Technical Assistance Programme that creates superior returns for investors by investing in women entrepreneurs.
This fund supports wealth and job creation, while providing support to women in developing countries, helping them to build viable and sustainable enterprises.
Who should apply?
Dynamic women with a record of achievement in businesses? that support women
To contact Women’s Enterprise Development Initiative
- Telephone: +27 11 958 1583
- Email: email@example.com
FSP Enterprise Development Programmes
FSP Enterprise Development Programmes are offered by banks or financial institutions.
Standard Bank Enterprise Development Programme
Standard Bank is offering a specialised Enterprise Development programme. The aim of this programme is to offer financing solutions to primarily BEE businesses that have achieved access to superior earning opportunities from corporates or the public sector.
- A black owned entity, either 51% black ownership or 30% black women ownership
- A supplier wanting to sell equity to become more BEE viable.
How to apply
Standard Bank has a different approach to enterprise development programmes. A business will select or choose a supplier and then contact Standard Bank, the bank will then offer the supplier financial assistance, which will enable them to meet their obligation to fulfil the contract.
For more information
- Contact: Vuyelwa Ndlovu on 011 344 5980
- Email: Vuyelwa.Ndlovu@standardbank.co.za
- Contact: Timna August on 011 721 7875
- Email: Timna.August@standardbank.co.za
Learn everything you need to know, where to go, what forms to fill in, and the fastest ways to get government funding.
First National Bank – Vumela Enterprise Development Fund
This initiative was developed in 2010 and has already invested R186 million into alternative SME financing tools.
The aim of this programme is to unlock explosive growth in SME businesses and for creating optimal conditions within these businesses to help them to achieve success.
“Our solution will help corporates meet the new B-BBEE requirements which could see some companies downgraded if they do not empower their supplier base.
More importantly, the holistic nature of our model could yield a sustainable economic growth model among the participating companies,” says Head of Enterprise Development at FNB, Heather Lowe.
This programme also targets high-impact SME’s and is open to all industries.
How to apply
Fill in the application form which is readily available and send it in to FNB or Vumela.
To find out more
Nedbank Enterprise Development Programme
This programme offers you growing business flexible financial solutions along with business strategy mentorship programmes.
Related: Tax Basics For Business Owners
By joining this programme you get access to a number of resources, including:
- Flexible lending, which will help you to purchase fixed assets, maintain your inventory and meet your ongoing operating needs
- Customised credit is structured to suit your businesses industry and cash flow cycle
- Mentorship and training, which will take place through seminars and accredited institutes
- This will help you to improve your business expertise
- Networking opportunities will enable you to meet like-minded entrepreneurs in your area.
How to apply and find out more
Apply through the Nedbank website or contact them directly:
Absa – Enterprise Development Fund
Absa host a R250 million Enterprise Development fund, which finances SMME’s in the value chains of these corporates or government entities.
Resource: Absa Enterprise Funding
This Enterprise Development Programme will also involve corporates and government entities that are interested, allowing them to meet their ESD obligations.
- Previously disadvantaged individuals with 100% black owned business
- Small to Medium-sized Enterprise (SME). This includes start-ups and existing businesses.
- Your SME cannot get normal financing from normal banking channels
- You are a South African citizen, residing permanently in South Africa
- You are fully involved in day-to-day operations
- You already have the skills/ expertise relevant to your business
- Your business can show profitable historical financials or a realistic cash flow forecast
- The business’ main transactional account is held with Absa, no split banking is allowed
- You need a loan of between R5 000 and R3 million with a maximum loan term of five years
- The economic benefit realised through the finance application resides in the province where your SME resides.
How to apply
Complete an application form and bring it in to your nearest Absa branch, along with the supporting documentation listed on the last page of the form.
Other Enterprise Development Programmes
These enterprise development programmes don’t belong to any one category and often have contributors from finance and government or are private sector developed, hosted by large companies themselves.
Tholoana Enterprise Programme
This is a high-energy solution that has helped hundreds of businesses to accelerate their success.
The programme includes all round support, expert mentorship, skills training workshops, access to market, and qualified investment-readiness support.
The Tholoana Enterprise Programme has been seen to improve the confidence and skills of entrepreneurs.
- The business is black-owned and managed
- Your business is operational
- Your business is headquartered and registered in South Africa
- The business should be commercially sustainable and viable
- You are involved in the business’s daily operations and management on a full time basis
- You have the skills and experience necessary for the type of business you’re engaged in
- Your business is in the initial stages of operations (older than 6 months and no more than 5 years).
How to apply
You have to register on the portal first, and then you can apply online here.
Please ensure you read the instructions on the portal carefully and download the “Online Application Guidance Document” from the link available on the portal.
For more information
Contact the SAB Foundation Tholoana Team directly on 086 111 1690 or 011 881 8798 (during office hours).
The Royal Fields and Job Funds’ Enterprise Development Programmes
Royal Fields Finance is a financial services group that focus on funding small and medium enterprises; in partnership with the Jobs Fund they have launched an enterprise development program worth R 100 million to support SME’s.
This programme focuses on SME’s that are unable to raise funding from banks or traditional funding institutions, due to a lack of trading history, security and risk capital.
The target of this programme is small and medium sized enterprises, that have an annual turnover of less than R60 million and that require funding between R 70 000 and R2,5 million.
The following sectors will be emphasised for this programme as they have been identified as high growth businesses:
- Small scale farming
- Renewable and clean energy
How to apply?
There is a comprehensive application process which can be seen on their website here.
You will need to complete a telephonic interview, face-to-face interview, credit assessment, compilation of credit reports.
Resource: The Basics Of Registering A New Company
Your application will then be considered by the Credit Committee and an onsite due diligence is conducted to assess your business.
For more information
Please contact Royal Fields Finance at:
- Tel: 086 178 9607
- Tel: 043 721 2238 (East London)
- Email: firstname.lastname@example.org
- Website: www.royalfields.co.za.
Siyakhula Enterprise Development Programme
Total South Africa launched the Siyakhula programme, which is part of Total’s commitment to transformation through the development of black entrepreneurs and enterprises.
Total South Africa CEO and Managing Director, Mr. Christian des Closières explains: “Although enterprise development has been a component of Total South Africa’s transformation strategy for some 60 years, it is time for the company to put more effort and resources into our enterprise development projects, start consolidating on the remarkable gains, and expand our enterprise development footprint into one consolidated programme, Siyakhula.”
This enterprise development programme focuses on three specific sectors, namely:
- Retail – service station network enterprise development
- Independent service providers
- Road transport
How to apply
To find out more send your enquiry or application to: email@example.com.
Government Enterprise Development Programmes
These are enterprise development programmes that are offered through various departments of the government.
Read: NYDA Funding
Government enterprise development programmes are targeted at specific demographics, including the youth and women, or focused on particular areas of trade.
National Youth Development Agency (NYDA)
NYDA is the national youth development agency and they offer a government supported and initiated enterprise development programme. The programme offers entrepreneurship training which corresponds to the labour market and the business needs of young people.
Awareness training is aimed at South African citizens between the ages of 14 and 35.
Structured/modular training is aimed at South African citizens between the ages of 18 and 35 and who are existing business owners or aspiring entrepreneurs.
For more information and how to apply
Applicants and those wanting to learn more about this enterprise development programme find your nearest branch information here.
The Small Enterprise Development Agency (SEDA)
The Small Enterprise Development Agency is an agency affiliated to the Department of Small Business Development.
The mandate is to implement a standard and common national delivery network for small enterprise developments as well as integrate government-funded small enterprise support agencies across all tiers of government.
For who qualifies and how to apply
Please find the application forms here.
For more information
- Contact SEDA: 012 441 1000
- Business Information Centre: 0860 103 703
- Website: www.seda.org.za
Business Model Design – Picking The Business Model That Works For You
You have the need to make money. That’s where a business model design comes in.
So, you’ve picked your lane. You’ve decided what you want to do and why you want to do it. You’ve picked something you’re good at. You’re convinced the world needs and values it. You now need to decide how to make money. That’s where business model design comes in.
There are plenty of business model options for the same idea. For example, let’s say your idea is to offer historic tours of Cape Town. You could either do it yourself or hire professional guides to do it. Or you could use mobile technology to provide DIY walking tours. You could charge per tour or you could charge a membership fee. There are so many options. How do you pick the model that works for you?
The Lean Canvas is a great tool for entrepreneurs who are faced with this question. Adapted from The Business Model Canvas, it provides a simple, one page framework for brainstorming possible business models, prioritising where to start, and tracking ongoing learning. It walks the entrepreneur through the business model process logically and ensures the key elements of a successful business are considered.
The Lean Canvas
My co-founders and I have used the Canvas extensively at Simply – for designing our business model, and for communicating it to partners and investors. The only thing you know with certainty when you start a business is that it’s not going to turn out as you expect it to. The Canvas evolves as you go – it was, and continues to be, a very useful guide in our journey.
We figured there was an opportunity to do something disruptive in the SA life insurance space. It was clear to us that lots of people were either not covered or getting a rough deal. Guided by the Canvas, we defined our first Customer Segment as adult South Africans, aged between 25 and 45 and earning between R5k and R30k monthly.
We then identified the 3 big Problems – specific to that segment – that needed solving:
- Most of the people in our segment have some form of funeral cover, but very few have life or disability cover.
- The cover they do have is often expensive relative to the benefits provided (i.e. a very small % of the premium goes towards the risk costs).
- There is no simple, intuitive way to buy good value life, disability and funeral cover online.
Next came the Value Proposition. We believed we could use technology, digital marketing and human-centred product design to deliver simple, online life, disability and funeral insurance at a great price. We felt we could be for life insurance in South Africa what Takealot has been for retail. We thought the world was moving far faster than incumbents realised; that millennials were ready to buy life insurance online; that we could build for the digital world and be in the right place at the right time.
Related: 4 Types Of Business Models
And the rest flowed from there. I don’t have the time or the space to walk you through the other elements of the Canvas here, but you can probably fill in the blanks. Suffice to say, the process was invaluable and enabled us to build our business around a clearly considered business model. It’s early days, but the signs are good – we’re making a positive impact, having fun and keeping our investors happy.
So, how should you go about sketching your own Lean Canvas? The team at www.leanstack.com and suggest the following approach:
- Sketch a canvas in one sitting. While a business plan can take weeks or months to write, your initial canvas should be sketched quickly.
- It’s okay to leave sections blank. Rather than trying to research or debate the “right” answers, put something down quickly or leave it blank and come back to it later.
- Think in the present. Business plans try too hard to predict the future which is impossible. Instead, write your canvas with a ‘getting things done’ attitude.
- Use a customer-centric approach. You may need to sketch one Canvas per customer segment. Start with the Customer Segment and go in sequence.
In summary, the Canvas has brought clarity and a common language to our business model design process. It’s enabled us to agree upon and communicate our business model effectively – both internally and externally. It’s also allowed us to tune and adjust our model as our story has unfolded – an inevitability for entrepreneurs. I highly recommend the Lean Canvas as a tool for designing your business model. Give it a try – I think you’ll like it.
Alan Knott-Craig’s Answers On Selling Internationally And Researching Your Idea
There is no ‘one size fits all’ secret to start-up success. But there is a recipe that can be followed. It starts with being willing to go the extra mile: To know more about your business, customers and their needs than anyone else.
What is the secret to success? — Anonymous
Success is not about winning. It’s about not losing. In other words, being successful is not about increasing the odds of winning. It’s about reducing the odds of losing. There is one simple way to reduce the probability of failure. Go the extra mile.
In everything you do, do a little more than expected. Need to prepare a proposal? Format it, add page numbers, spellcheck, PDF. Need to instal a router? Arrive early. Finish early. Dress neatly. Smile. Need to refund a customer? Be polite. Don’t delay. Apologise. Follow up. Need to provide 5MBs? Provide 10MBs. Need to be at work at 6am? Be at work at 5.30am.
Go the extra mile. Over-deliver. Blow away everyone in every little thing you do. If you do that, from the littlest things to the biggest things, you will have the lowest odds of failure.
In other words, you will not lose. As an entrepreneur, not losing is winning. Go the extra mile. It’s less crowded.
I’m a virtual business on Johannesburg’s East Rand and I want to expand my target market to the US. I unfortunately don’t have any international network that I can tap into.
I’m investigating Fiverr, Reddit and Upwork as potential avenues of work and market research tools. I have also made contact with an international VA agency. What else do you recommend I do to break into the international market? — Jade
Selling internationally is no different to selling locally. It’s all about growing your network, sweating your network, and putting yourself out there.
Everything you’re doing is right. Chase all potential channels to market. Tell family and friends. Ask clients for references or leads. Don’t forget the magic of Google AdWords. And a LinkedIn Premium subscription.
Make it easy for your potential customer to find you. If you’re going to use an agency, remember this: Make the agency rich. Don’t begrudge your ‘sales arm’ making money off your sweat. The more money the agency makes, the more business it will send your way.
I’m based in a small town where people are accustomed to what they know as opposed to adapting to something new. I’ve advertised in the newspaper, sent out fliers and have a Facebook page with over 500 likes. So far, the response to my tutoring service business has been slow. How can I improve? — Stephanie
You’ve made a big assumption: That there is demand for paid-for tutoring. Generally speaking, you should sell your product before you start your business. Sell it, then build it. It’s safer.
But maybe you’re on the right track. In addition to paid-for marketing, consider channel partner and referral programmes. Go to your local high school, meet the maths teacher, offer a commission for every student she sends to you for tutoring. The maths teacher becomes a channel partner, allowing you to put up posters at the school, and referring clients.
Even better than channel partners is a referral programme: For every new client referred by a client, give the client a 10% discount, or a month free.
At the end of the day there is no shortcut to getting more customers. Start with one. Make her happy. Let her tell a friend. Tutor the friend. Rinse, repeat. Over time your service reputation will grow and word of mouth will bring customers to your door.
I have an idea to build a mobile platform to connect all informal artisans in SA to potential customers. Uber for artisans. Will you invest? — Neo
Great idea. Some questions: How do you displace the other informal platforms in SA, such as Gumtree? How do you de-risk your business before raising capital? Can you secure funding without selling equity?
Before you give theoretical answers, remember this: The questions are not theoretical. No one should back you unless you have the above solved in reality, not just in theory.
In other words, raising capital is only realistic once the risk is so low you almost don’t need to raise capital.
Listen to this
Alan’s audible book Be a Hero: Make Life an Adventure is now available on amazon.com and Audible.com
Read by Alan himself, Be a Hero is a collection of stories on how to make your life an adventure by changing your mindset and tackling adversity.
Go to amazon.com or audible.com to download your copy. Be a Hero is also available in Kindle and paperback through Amazon.com.
Read ‘Be A Hero’ today
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