According to the Tourism Ministry, domestic tourism comprises of 70% of the tourism value in SA. April is particularly a profitable month for businesses in the hospitality and leisure industry as South Africans take advantage of the public, religious and school holidays and flock to various holiday destinations.
Hospitality business owners should use this month to take stock and assess the risks that could disrupt the flow of business and profit over this period, warns Santam, South Africa’s largest commercial insurer.
“A fire, burst geyser, armed robbery, even a flood could devastate a business owner’s ability to conduct business over this potentially profitable period,” says Lourens Joubert, head of commercial underwriting.
Evaluate your policies
The insurer says it is for this reason that a business should use this period to evaluate their insurance policies. “Take this time to verify the terms of your policy, to make sure everything is up to date, that you are not underinsured and that you comply with all the conditions of your insurance policy,” says Joubert.
He says that it is important for business owners to consider the unforeseen. What happens if a guest of the lodge or guesthouse gets injured or sick on the premises? Would the business owner be liable should a guest’s luggage perish in a fire at the lodge or B&B?
“These are questions that business owners should consider but we always advise them to consider them with the help of an expert insurance broker. A broker would also be an ideal resource to rely on to lodge claims with an insurer after a devastating loss while the business owner gets on with taking care of guests and the continued running of the business,” says Joubert.
Focus on management
He advises business owners to use a simple four step risk management process:
- Investigate all potential risks and exposures to the property, premises or other persons (like guests and other visitors). These can be classified broadly into these categories: natural perils (eg, hail, storm, lightning, etc), crime related perils (exposure of the business to burglaries, armed robberies, theft of vehicles or hijacking etc), and lastly accidental damage (damage to computers and other valuables on the premises etc) and, very importantly, liabilities (e.g. for injury to guests or their property).
- Then evaluate the risks and exposures in terms of the likelihood of the related event happening and the size of the loss should the event take place, for example: The likelihood of storm damage for guest houses located in the Western Cape during the start of this rainy month are high and the size of the loss would be medium to large ( the actual property could be completely flooded depending on its location); or the likelihood of a fire at a lodge in the cool Drakensberg is low but the size of the loss could be high to extremely high)
- Business owners can then control the risk by using the information regarding the likelihood of the event and size of losses. The business owner has to decide whether some of the risks can be eliminated or reduced (e.g. installing an alarm, burglar bars and safety deposits for their guests, reduces the likelihood and size of potential burglaries and aggravated robberies)
- Lastly business owners would then need to finance the residual risk which is the risk that is beyond their control and that cannot be eliminated or reduced to an acceptable level. The most common method of financing the residual risk is insurance. This would also be the most viable option for the small business owner of a small guesthouse, lodge or backpackers.
Africa’s Top 10 Tech Start-Ups Selected For #Africa4Future Accelerator Programme
Airbus and the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) have announced the top 10 African tech start-ups that will take part in the latest Airbus Bizlab #Africa4Future accelerator programme. They were selected after an open public pitch event in front of experts, potential investors, the media and other stakeholders in Kenya’s capital city.
#Africa4Future is a joint business accelerator initiative of Airbus and GIZ’s Make-IT in Africa initiative together with the Meltwater Entrepreneurial School of Technology (MEST), a non-profit seed fund and pan-African organisation that brings together startups, entrepreneurs and the tech community, and Innocircle, the South African-based innovation consultancy.
The top 10 start-ups were selected from 314 entries representing 19 African countries that were received when the challenge was opened last October. These were assessed by a panel of Airbus and other independent experts.
The programme aims to encourage and support entrepreneurship in Africa. The continent’s young and increasingly techno-savvy population is likely to be the driving force behind Africa’s socio-economic development. The competition identifies Africa’s own pool of talented entrepreneurs using innovative aerospace based solutions to tackle the continent’s most pressing challenges such as transportation, agriculture and healthcare.
As a global aerospace accelerator, Airbus BizLab is ideally suited to help African startups transform innovative ideas into viable and valuable businesses. In doing so, it increases the aerospace industry’s engagement with hardware and software innovators and entrepreneurs in Africa while helping to nurture the establishment of competitive entrepreneurial ecosystems on the continent.
The Nairobi event kicks off an intensive 6-month business incubation and accelerator programme involving technical, commercial and mentorship activities in France, Germany and South Africa. This includes workshops and coaching sessions with Airbus experts, GIZ’s Make-IT in Africa, MEST and Innocircle coaches.
The programme will culminate with Demo Day events at the biennial Paris International Airshow and a special event in Germany from 19-26 June, when finalists will launch their products, define their collaboration with Airbus and announce their investment commitments in front of representatives from across the aerospace industry.
1. Astral Aerial (Kenya) – using drones for humanitarian cargo transport, surveillance and emergency response.
2. Cote d’Ivoire drone (Ivory Coast) – locally-manufactured drones for various applications.
3. Elemental Numerics (South Africa) – applies computational fluid dynamics techniques to the design of machines and components, ranging from aircraft to heart valves.
4. Lentera Limited (Kenya) – applying remote sensors to monitor and transmit environmental data to enable more efficient and smarter farming.
5. Maisha ICT Tech PLC (Ethiopia) – deploying locally built drones for delivering medicines, blood and healthcare items to remote and rural areas.
6. MamaBird (Malawi) – provides a platform to help Governments, NGOs and other organisations deliver vital life-saving supplies to remote communities.
7. Map Action (Mali) – a solution offering real-time online urban mapping to identify problems affecting water supplies, hygiene and sanitation.
8. MobiTech Water Solutions (Kenya) – an online real-time water monitoring solution that allows businesses, homes and water-service providers to manage their available water using an app-based dashboard and instant messaging.
9. Track Your Build (Nigeria) – a novel infrastructure management tool for construction and operations.
10.WiPo Wireless Power (South Africa) – offers reliable and convenient wireless power chargers for businesses, conference centres, airports, restaurants and other venues for the charging of mobile devices, laptops and drones.
Related: 21 Steps To Start-Up Success
Top Sectors For SMEs In 2019
“As such, SMEs in the construction, communications and electrical fields are all likely to benefit from supply and sub-contracting agreements over the coming years.”
While the South African economy has been underperforming for a number of years, the first positive signs of turnaround started to become visible by the second quarter of 2018, and by the end of the third quarter, data supplied by Statistics South Africa showed that the economy had indeed grown by 2.2 percent, compared to the previous quarter. This uptick is expected to have a positive effect on business confidence in 2019.
This is according to Jeremy Lang, regional general manager at Business Partners Limited (BUSINESS/PARTNERS), who says that certain business sectors have already seen an increase in opportunities for small businesses and start-ups.
“While these sectors will not be without challenges, the following four industries are likely to offer the best opportunities for small and medium enterprise (SME) owners to grow their enterprises in the coming year.”
The World Travel and Tourism report 2018, revealed that the direct contribution of the travel and tourism sector to South Africa’s GDP has been projected to rise from R136bn in 2016 to R197.9bn by 2028 – set to make up a total of 3.3 percent of the country’s total GDP, says Lang.
“Although this sector experienced some setbacks in 2018, such as the drought in the Western Cape and stricter visa regulations for children entering the country, both the water restrictions and visa regulations have been relaxed and the sector is once again poised for growth,” he says.
Statistics South Africa has credited this industry with being the biggest driver of growth in the country’s GDP, having expanded by 7.5 percent in September 2018, says Lang. “To bolster this, Government has made a concerted effort to stimulate small business growth in this area with initiatives such as the Black Industrialist Programme and the SA Automotive Masterplan.”
He adds that businesses in the manufacturing sphere could therefore likely see significant opportunities in the form of outsourcing contracts and new partnerships with large corporates.
“The debate around land expropriation has occupied most of the discussions surrounding the agricultural sector in 2018, with some questioning growth prospects of this sector. However, this industry has a lot of growth ahead of it, as demonstrated by its 6.5 percent growth over the last three months of 2018,” explains Lang.
“Further to this, the industry is also already taking significant advantage of seven climatic regions in South Africa, with the export of a wide variety of high quality fruit and vegetables increasing substantially,” he points out. The recent outbreak of foot and mouth disease that has resulted in the suspension of the country’s FMD-free status will however significantly impact meat exporters.
In terms of opportunities for SMEs, he says that these may most likely be found in the rural and underdeveloped regions, where the need for resources like efficient transport, state-of-the-art cold storage, better irrigation and private power generation will be key to making agriculture projects more productive and competitive in the export market.
Data and information technology
Connectivity and information technology infrastructure are both crucial to business and employment growth in South Africa, says Lang.
“With many municipalities and the Western Cape government committing to providing all of its residents with free data as part of a plan to expand public Wi-Fi network access, it is clear that this is also becoming a high priority on a state level.”
It has also been reported that South Africa is awaiting the arrival of three international data centres, and large players in the communications sphere, including Vodacom, Telkom and Vumatel, are making huge strides in drastically growing the country’s fibre optic backbone, he adds. “As such, SMEs in the construction, communications and electrical fields are all likely to benefit from supply and sub-contracting agreements over the coming years.”
In conclusion, Lang says that as South Africa’s economic growth has started to turn around, business owners should keep their ears to the ground as 2019 is highly likely to be a year of opportunity.
Herman Mashaba To Talk On City Of Jo’burg Job Creation Initiative
Herman Mashaba to talk on City of Jo’burg job creation initiative at 2019 Business Day TV SME Summit.
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