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 In Start-Up Guide

Small and medium enterprises make up the life-blood of our economy. Although this sector of the economy is largely ignored by both the media and the general public as well as receiving little support from the Government, small and medium enterprises will always play a vital role.

Small to medium enterprises, according to recent studies, provide about 61% of the country’s employment.

Micro-enterprises provide employment for 17% of the South African workforce, small enterprises 21% and medium-sized enterprises 18% of employment for a total 56% according to a survey conducted in 2008.

If you feel that it is time to jump on the small to medium enterprise bandwagon, you will undoubtedly be making a valuable contribution to the economy and above all, you will become your own boss.

Many entrepreneurs have brilliant ideas to start up a business but often don’t have the backup or confidence to venture into something new.

Despite the ongoing efforts of numerous private and public enterprises, most are quick to admit that the outlook for local SME’s is rather bleak.

Although South Africa remains a rather challenging place for a start-up business and while there are companies as well as Government assistance in terms of skills development together with access to numerous opportunities, regulatory red tape as well as unpleasant labour legislations in addition to some of the most costly banking costs and expensive communication and transport costs a rather challenging environment for SME’s to remain in business.

It is time to think out of the box when it comes to small business; with a combination of Government action, private-sector support and individual passion, the SME sector will be able to undergo nothing short of a transformation.

Definition of a Small to Medium Enterprise

  • A very small or micro-enterprise consists of 20 individuals.
  • A small enterprise usually consists of up to fifty employees.

In South Africa there are in the region of 650 000 active Small to Medium Enterprises.

There has been a perceptible upsurge in the appearance of SME’s in sub-Saharan Africa. According to the Global Entrepreneurship Monitor on South Africa, Uganda, Angola, Ghana and Zambia – the number of small and established businesses is high.

The percentage of established owned businesses in certain African countries was higher than in others.

In Ghana for example, it is as high as 40% and in Uganda, the percentage was about 27% in 2010 – these are way higher than in both China and Brazil where SME’s only account for in the region of 15%.

For start-ups and entrepreneurs access to credit still remains a key issue for development on the continent of Africa.

South Africa’s small and medium enterprises are the lifeblood of our economy – there is no time quite like the present to jump on the bandwagon.

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