As we celebrate the annual Small Business Friday, Small & Medium Businesses should also be carefully thinking about what a wave of unprecedented technology change could mean for their companies in the years to come.
That’s according to Anton van Heerden, Executive Vice-President and Managing Director, Sage South & Southern Africa, who says that smaller businesses are as exposed to the risks and opportunities of new technology as larger companies – if not more. Savvy small business owners should thus be looking at their own markets to anticipate how technology will change their operations and the ways their customers behave in the years to come.
Van Heerden says that disruption occurs when a new player comes into an established market with an innovative way of doing things that changes the game for everyone else – usually driven by clever use of technology. For example, the entertainment industry was disrupted when music and movies turned into digital products (downloads) and then into services (streaming).
“This trend has already had a major impact on many smaller businesses – for example, family-owned bookshops and video rental stores have needed to create new opportunities for themselves,” says Van Heerden.
“Overall, digital technology creates some wonderful new ways for Small & Medium Businesses to reduce costs, reach new markets and grow revenues.”
Here are some ideas about how Small & Medium Businesses can use disruptive technology:
1. Fintech revolution – new solutions for small companies
Financial technology (fintech) companies use technology to make financial services more efficient. For example, companies like Sage Pay make it easier and more affordable for Small & Medium Businesses to transact securely online. This, in turn, means that it is simpler and more convenient for small businesses to trade nationally and internationally.
2. Entrepreneurial opportunities built on other organisations’ platforms
One exciting trend is the way that companies like Uber and Airbnb help people to create new businesses opportunities for themselves, often with little investment than some of assets that they already own.
For example, you can become a driver for a ride-hailing company or rent out a spare room in your house via the Internet. If you’re pursuing another dream business idea, this can help you bring some revenues in while you are still busy building your company. It can also become a business in its own right.
The platform companies do the marketing, provide the website and transactional system, vet customers and suppliers, and connect entrepreneurs with people who need their services. The barriers to entry are quite low and the profits can be attractive.
3. Low-cost, high-impact technology
Cloud (online) applications make software like accounting systems, CRM packages and payroll solutions more affordable to Small & Medium Businesses. Essentially, they turn what used to be a large upfront capital cost into a small monthly expense and give smaller businesses access to secure, world-class software.
But the cloud also makes it faster to put great technology in place for your business and gives you more flexibility to add users and functionality as your business grows.
Cloud computing allows you to work anytime and anywhere – just so long as you have an Internet connection and a device with a modern web browser. It also promotes collaboration.
4. Ways to shave expenses
In a tight economy, Small & Medium Business owners welcome any way to reduce costs without compromising on quality and service. Many technology services allow them to meet this goal.
For example, fintech can make it cheaper to take and process payments, ride-hailing services are an affordable alternative to taxis, and even accommodation sharing sites have more affordable properties that are suitable for business travel.
5. Driving down marketing budgets while keeping the personal touch
Social media and search are changing the ways that big brands do their marketing, and entrepreneurs are also starting to catch on. Twitter, Facebook, Google and other online services offer a range of affordable and even free ways to promote your goods and services. They also offer you easy-to-use analytics tools so that you can track your performance.
We’ve seen many small businesses, such as restaurants use Instagram to show their delicious dishes to potential customers. A DIY store can shoot some simple videos with a digital camera or even a smartphone to show people how to install a shelf.
The beauty of this is that you’ll get instant feedback and find new ways to create customer relationships by interacting with people online.
“In a time of seismic technological change and digital invention, our smart people are using the smartest technology to reinvent and simplify business accounting,” says Van Heerden.
“Our research teams are working on making concepts like the Internet of Things, machine learning, blockchain and data sciences into a reality for African businesses, accountants and partners.”
“Small & Medium Businesses that see these technologies as an opportunity to create new services, markets and processes will position themselves for strong growth in the future.”
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Off The Beaten Track
What Tourism Month means in South Africa and how Mango Airlines is focusing on local opportunities.
This September, being Tourism Month, we have so much to talk about in South Africa, and so many people to engage with, both domestically and abroad. We are privileged to be able to leverage a broad range of destinations – arguably world-class in nature, and they expand way beyond a beautiful mountain, and an ecosystem of game.
The vast majority of leisure tourists, however, remain attracted to the Mother City and various Safari destination, while business tourists tend to stick to hub cities for short durations of time before departing again.
“There is a golden opportunity to expand on the same offerings – while not detracting from them in any way. Our responsibility is to drive tourism into new areas, really emphasising the differentiators that are incredibly attractive to local and international tourists,” said Benediction Zubane, Head of Marketing at Mango Airlines.
“Often tourists visit one of the more well-known sites in an area, and are completely unaware of the other features and destinations close by. We’re seeing a lot of success in township tourism which goes to show how diversifying can really drive new tourism opportunities,” explained Zubane.
According to Statistics South Africa survey on Tourism and Migration, nearly 3.5 million international travellers visited South Africa in August 2017. Top numbers were tourists from USA, UK, Germany, France and The Netherlands, with African visitors primarily coming from SADC countries. Zubane added, “This means there is vast opportunity to begin engaging with travellers in new countries across the globe. We need to become our own best ambassador, talking-up our famous and lesser known destinations, proudly showcases our uniqueness. We should also be tourists in our own country and start exploring the wonders of the Rainbow Nation.”
Mango is passionate about helping its SMEs and entrepreneurial community to successfully overcome the unique challenges facing the tourism industry: “There has never been a more opportune time for small businesses and entrepreneurs to benefit positively from tourism in South Africa, and we hope to celebrate alongside our SME community as they fly high – both literally and figuratively,” he concludes.
FNB Receives 50 Million US-Dollars To Accelerate SME Development
First National Bank puts their focus on SME development in South Africa.
First National Bank (FNB) has received 50 million US-dollars from the DEG – Deutsche Investitions- und Entwicklungsgesellschaft to deploy towards small and medium enterprise (SME) development in South Africa.
DEG is a development finance institution whose mission is to promote private-sector enterprises in developing and emerging-market countries as a contribution to sustainable growth and improved living conditions.
Mike Vacy-Lyle, CEO of FNB Business says: “The new line of funding contributes to our ongoing efforts to accelerate our contribution to SME development in South Africa. We believe that SMEs are key to stimulating sustainable economic growth and job creation. Our intervention in SME development is not only limited to funding, we also invest heavily to improve capacity and supplier development capabilities in small businesses.”
FNB continues to pioneer products and services that have taken the angst out of South Africa’s entrepreneurs, from providing free instant accounting services to online documents reservation services, and forming public-private partnerships to digitise the registration of businesses.
“Our message to entrepreneurs is that we remain committed to providing meaningful solutions to help them grow. We have exciting developments that will take us further in our journey, all aimed at advancing the SME agenda by taking the anguish out of doing business,” concludes Vacy-Lyle.
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