A sound education, confidence in the product or service on offer and good financial skills are the key ingredients prospective entrepreneurs must have to be successful in the world of business.
This was a key point made by Professor Walter Simeoni, the Founder of WS International, a Business facilitation Service, who recently (11 June 2015) delivered a lecture titled: Small Business in a Challenging South African Environment at the MANCOSA Graduate School of Business (GSB) in Durban.
The lecture was part of the Mancosa [GSB] Leadership Lecture Series in line with its endeavor to engage with stakeholders and initiate dialogue on topics relevant to the disciplines of management and business.
Professor Simeoni suggested that individuals who lack the key business skills but are keen to venture into entrepreneurship should consider gaining work experience in their field of interest before embarking on any business ventures.
“I suggest that if you do not have those skills, then seek employment in a company which operates in the field of your choice. Once you have gained sufficient experience over a few years, then you may have a better chance to follow your dream,” he said.
According to Professor Simeoni every entrepreneur who starts up a business experiences challenges at inception and possibly along the way. He said starting a business is one of the bravest undertakings because entrepreneurs have to work twice as hard in comparison to those in the corporate world.
He discussed several challenges facing entrepreneurs including:
- The lack of awareness on NGO and government support structures offering advisory services to SMEs (Small and Medium Enterprises);
- The inability among entrepreneurs to create a business plan documenting the product or service they intend offering;
- The inability to undertake research to establish market opportunities in terms of their target market; information on their competitors and comparisons between their (entrepreneur’s) product and that of their competitors;
- Limited financial skills resulting in the inability to manage cash flow and determine working capital requirements.
“In my opinion before an SME is registered, it is imperative that the entrepreneur has his or her total skills level assessed. If necessary, they should be offered free entrepreneurial training in order to prepare them for success and long term sustainability. Only after this step should they proceed with registration,” said Professor Simeoni.
Professor Simeoni said higher education institutions should generate empirical evidence on the failure rate of SMEs, adding that this will help policymakers in South Africa address the sustainability of SMEs in the country.
He advised South Africans to learn from other countries like Japan and Korea who have a successful history in small business development and its sustainability.