1) FREE at selected outlets or by bulk subscription EDITION 17 February 2015 HELPING YOU RUN A BETTER BUSINESS www.SmallBusinessConnect.co.za Will small biz tax change? BY AMUKELANI CHAUKE TAX practitioners believe that when Finance Minister Nhlanhla Nene tables his budget in the National Assembly later this month, he is likely to announce tax measures that will spare the small business sector. When he tabled the Medium Term Budget Policy Statement (MTBPS) in October last year, Nene said that if any tax changes were made that these would only be announced in the 2015 Budget Speech. Ettiene Retief, the tax committee chairperson for the SA Institute of Professional Accountants, says he expects some relief or some kind of benefit for small businesses. “Giving relief to a small business from a tax perspective is not going to have massive impact in the fiscal collection, but it can have a big impact on small businesses” he says. Retief, who was one of the stakeholders invited to make tax proposals to the Davis Tax Commission, says while the government’s tax incentives may have helped small businesses, particularly startups, more measures to reduce red tape would be welcome. “But the timing and the type of tax incentives are very important because something like a tax deduction is not going to help small business get off the ground. When you have a small business and you manage to get a profit of R10 000 or R20 000, you pay a tax on that. It is difficult. “If you have tax of R100 000, it might not seem like a lot of tax from a government’s perspective, but it might mean a massive difference to a small business going forward because it is cash flow." Although VAT is also another way of taxing businesses, Retief says the minister was likely to only increase it by half a percent to 14.5%, which would raise a few billions, while exempting several food products to spare the consumer, especially the poor, from feeling the pinch. Meanwhile the National Treasury has already accepted two of the recommendations from the Davis tax committee’s report on small businesses – namely amendments to the turnover tax on micro businesses and to Small Business Corporation tax. The latter is expected to take effect from January next year, while a date for when the former becomes effective has yet to be announced. In addition the new rules for the venture capital (VC) tax incentive will also come into effect in the next tax year, while grants given to small businesses will be taxexempt and organisations involved in supporting small firms will get tax relief through a dedicated tax provision. Head of secretariat for the committee Vinesh Pillay says that public comments have been received on the interim report and the report is being reworked based on that. “We still have to meet with other roleplayers such as the Minister of Small Business Development so no deadline has been set for a second release,” says Pillay. He adds that it is important to note that the report carries only recommendations and there is no guarantee that these will be adopted. “There is a process involved. We submit to the (finance) Selling his craft is all in the art of his storytelling Crafter Zacharia Mukwira sells his paintings at the Spier craft market in Cape Town. He is often the highest seller. Find out how he does this by reading his story on page 10. minister. The minister tasks his team in Treasury to review and it is then decided whether or not it will be implements via the budget or legislative process,” says Pillay. Eric Mlambo, the founder of Relevant Media and Concepts, says the tax he pays eats into Google shuts down free biz site builder www.facebook.com/SASBconnect www.twitter.com/SASBconnect Page 3 Solar geyser providers forced to close Page 4 E-fresh franchise grows rural businesses Page 7 his cashflow. "I think as a small company, we need tax breaks for companies that have a turnover of less than R5 million per annum because you find that you are taxed as if you are a big business.” National Treasury spokesperson Jabulani Sikhakhane said the department was unable to comment on any tax proposals until after the budget is tabled in Parliament on 25 February. Meanwhile, the minister has invited members of the public to send him tips ahead of his budget. • Go to www.treasury.gov.za. Long road to success for McDonald franchisee info@SmallBusinessConnect.co.za Small Business Connect is published for the Department of Trade and Industry by SA Business Owner and Co cc of 4 Nuttall Road, Observatory, Cape Town and printed by Paarl Media of 5 Lynx Roads, Paarden Island, Cape Town. Use of information is at own risk. Neither the dti nor the publisher may be held liable for any loss or damage that may occur as a result thereof. Page 6 

2) page 2 - February 2015 SMALL BUSINESS CONNECT NEWS IDZ gives owner lifeline BY DANIEL BUGAN SIX weeks is a long time in the life of a business owner. It could be the difference between declaring bankruptcy or living to fight another day. This is how Eastern Cape entrepreneur Andre Redcliff described the lifeline he was given to participate in a four to six month Coega Industrial Development Zone (IDZ) project. Coega, located near Port Elizabeth, is one of six IDZs in the country. Redcliff says he is grateful for the help he received. Last month his company, A-Unit Trading began work as a subcontractor to contractor NMC Construction on a project to build factory buildings in Coega. His business is one of 200 that have benefitted from the Coega IDZ’s 2013/2014 procurement spend of just over R60 million. “There is a shortage of work in Port Elizabeth for small businesses. Most of the work goes to the big construction companies with big Construction Industry Development Board (CIDB) gradings. Even if the project is only for four or six months (long), I am happy for the opportunity. It does not happen every day.” Redcliff says he has been waiting for five years since the launch of his company in 2010 for an opportunity like this. The Coega IDZ construction project, where his company provides plastering work is his first contract. He worked as a tradesman for a local construction company, while waiting for his fortunes to change. The Coega contract came his way after he registered his business on Coega’s supplier database two years ago. He had to supply Coega with documents such as BEE certificates, tax clearance certificates and CIDB grading certificates. “They (Coega) phoned me at the end of last year to apply for the plastering tender. I was informed that my tender application was successful at the beginning of January,” says Redcliff. He will be paid R50 to R55 for every square metre that his company plasters. “If I make more than R130 000 on this project I would get an upgrade on my CIDB grading from a level one to a level two. This might mean that I might score more work with Coega as companies with bigger CIDB gradings are generally favoured.” In addition, Redcliff has also registered his business on the supplier databases of the Sarah Baartman District Municipality, the Department of Health and the Department of Public Works to improve his chances of securing more work. Apart from construction work, the Coega IDZ also procures services Coega Industrial Development Zone procured R60 million of services from small business owners. such as cleaning and landscaping services from small businesses. Coega IDZ’s head of marketing and communications Ayanda Vilakazi says the organisation delivers infrastructure projects which mainly focus on building and civil works. The IDZ allocates 35% of the value of each project to those small businesses registered on the Coega database. “During the 2013/2014 financial year, we actually exceeded our target of 35% small business participation on all contracts awarded, achieving 38% involvement and participation,” says Vilakazi. He says only businesses which are registered on the Coega supplier database will qualify for involvement and appointment to IDZ projects. To join the database, businesses must have a grade one to grade six CIDB grading and must be able to produce documents such as tax clearance certificates, CIDB registration certificates, BEE certificates and business plans. • For more information, go to www.coega.co.za. Hunt for next Mashaba BY STAFF WRITER SMALL business owners will not be excluded from the 100 black industrialists development programme says the Department of Trade and Industry. This comes in the wake of the department’s search for South Africa’s next Herman Mashaba, as the government positions itself to assist 100 large blackowned and managed companies within the next five years. The department’s spokesman, Sidwell Medupe, mentioned the example of Mashaba who started his hair products business, Black Like Me, from the boot of his car. Today the brand is a household name in South Africa and worth billions. “Most big industrial business-es started out as small businesses. We want to develop the potential of small businesses to become big businesses,” says Medupe. He adds that the aim is to develop existing small blackowned businesses. Herman Mashaba He singled out the Black Business Council (BBC) roundtable discussion that Trade and industry director-general Lionel October attended in late last year in Sandton. “This is why the directorgeneral (October) attended the BBC roundtable discussion – to make businesses aware of the government’s intentions (to develop 100 black industrialists) so that they can develop themselves to compete with big businesses.” He says the department is working on creating a dedicated incentive for black industrialists, adding that an announcement would be made as soon as the incentives had been approved. More information on how businesses can apply for inclusion and development under the programme will also be made available at a later date, he said. Speaking at the BBC roundtable discussion October said the creation of 100 large blackowned and managed companies within the next five years will help address the country’s dependence on imports. He said the department is looking at merging its Industrial Policy Action Plan (Ipap) and the BEE programme under the Black Industrialists Programme, so as to offer offer black industrialists better access to markets. • For more information, go to www.thedti.gov.za. • Turn to page 20 to read more about Small Business Connect's upcoming event with Mashaba. EDITORIAL AMONG all the talk of selfemployment as the new career option and the huge contribution small businesses can make to job creation and economic growth, it is often forgotten that one of the most difficult things a person can set out to do is to start and grow a small business. It is more difficult to be a successful entrepreneur than it is to create a good corporate career! For instance, the Global Entrepreneurship Monitor shows that only 2.9% of the adult population are engaged in established businesses, while 10.6% are engaged in new businesses - a clue that most do not survive. The statistics vary only in severity depending which study you refer to – roughly only one in ten startups are still around a decade later and half have failed after three years. Failure is more likely than not when you start your own business. So why is entrepreneurship seen as the salvation for job creation? And why the talk of an imminent entrepreneurial revolution? From the perspective of a practitioner who has been involved in small business development from before South Africa had a policy on promoting small business, I’ve seen how we as a nation moved from a cautious acknowledgement that entrepreneurship is to be incorporated in our strategies for economic growth, to an enthusiastic embrace of enterprise development as a key element of our future prosperity. The shift is significant and its institutionalisation is fast taking shape. The establishment of supplier development programmes and the creation of a government department dedicated to small business development, illustrate this shift. The revolution is seemingly limited to the explosion of entrepreneurial support and not of small business success. If the support that works is replicated and others are tweaked so that they do make a real difference in the success rate of small businesses, a true entrepreneurial revolution may by imminent. But then we need to find new ways of doing. I trust that initiatives such as the upcoming Forging Enterprise 2015, a conference which marks 20 years of small business promotion in South Africa, will offer direction in making the entrepreneurial revolution possible. Christoff Oosthuysen Publisher www.facebook.com/SASBconnect www.twitter.com/SASBconnect info@SmallBusinessConnect.co.za 087 150 4710 

3) www.SmallBusinessConnect.co.za NEWS February 2015 - page 3 Google shuts down free biz site builder BY DANIEL BUGAN BUSINESS owners whose websites run through Google’s Woza Online service have less than 30 days to create new websites. This follows the search engine’s decision to shut down its free website builder on 28 February. The service was officially launched in January 2012 in partnership with the Department of Trade and Industry, Vodacom and the Human Resource Development Council. Google also shut down similar website builder services in Nigeria and Kenya at the end of December last year. Woza online users have until 1 May to log into their accounts. The closure of the service also follows numerous reports, including a report in Small Business Connect in August last year, where several business owners were the target of fraudster;s copying their websites and promising goods to customers who believed that they were buying good from legitimate businesses A statement released by communications consultancy Africa Practice on behalf of Google, said that the Woza Online service was closing to allow the search engineto improve its suite of offerings for small business owners with the launch of Google My Business in South Africa. The Google My Business service helps customers find businesses through searches, but does not offer website building or hosting packages. Vodacom’s executive head of corporate communications Richard Boorman, says they are sad to hear that Google’s Woza online programme is coming to a close and that small businesses will be denied this free service. “However, it is encouraging Lianne De Beer was the first business owner to have her website built by free site builder Woza Online. that Google is offering its current users alternatives,” says Boorman. Caterer Lianne de Beer is one of thousands of South African small business owners who will see their Woza online sites shut down later this month. De Beer, the owner of Party Platters, says Google informed her of their intention to close down the service through a notice on her website in November last year. “I was the first (South African) business to have a Woza online website built in 2011 (prior to the service’s official launch). I was very impressed because it was so easy to use,” says De Beer. She says her catering business received 18 job offers in the first month of her website going live, with an average of five platters per Data law to 'name and shame' BY STAFF WRITER OFFENDERS will be “named and shamed” and could face jail time of up to 10 years should they not comply with Protection of Personal Information Act which is expected to come into effect early this year. The act, which essentially regulates how anyone who uses personal information must handle, keep and secure that information, was signed into law in November 2013 and is expected come into effect at a date to been published in the government gazette. The legislation provides for a 12-month phase-in period will apply after the act has been signed into law, which means that this period has already passed. Janine Janse van Vuuren, head of legal and compliance at underwriting management agency Stalker Hutchison Admiral, says the act provides for publication of any order made by the court, on any Janine Janse Van Vuuren party breeching the security of personal information of any client or employee. The act also makes provision for the imposition of administrative fines of up to R10 million and imprisonment of up to 10 years. “It is clear that the act aims to introduce a measure of market discipline through the use of ‘name and shame’ provisions. This could have massive reputational impact for a business which may be more damaging than the fines or awards imposed by the court.” Janse van Vuuren says any business that stores client, customer or employee information is seen as the custodian of that information and has a responsibility to ensure that it keeps such information safe. Should the security of that information be breached, the act provides for financial redress to affected parties in the forms of damages awards. Janse van Vuuren says it means business owners who are not careful may face possible financial and reputational ruin. “A class action stemming from a breach of information involving a large number of customers could cripple a company financially. “Also, the legal costs of defending such an action would be devastating, even if the action is successfully defended, as it is unlikely that the costs will ever be recovered. “In addition, there will be a responsibility on the business owner to notify all affected customers of the breach – this could be very expensive,” says Van Vuuren. Janse Van Vuuren says it is important for businesses that store the personal details of customers and employees to have a comprehensive cyber insurance policy in place. Such a policy provides cover for firstparty expenses, loss of business income, notification expenses, crisis management expenses as well as associated regulatory fines and penalties to the extent insurable by law. Ken Mee, owner of Ken Mee & Associates Financial Consultants, says he is not aware of the act or its implications. “Obviously I don’t want to fall foul of the law,” says Mee. “I will have to take a look at the legislation and see what’s appropriate to me and how I can comply.” job. She says she will now have to start from scratch and will have to pay to have a new website designed. Bafedile Mokoena, owner of Pruben Communications and Design, was customer number 25 000 to sign up with Google’s Woza online service in 2012. She says Google informed her via an email that they would no longer be offering the Woza online service. “Google said I could look at Vodacom to host my website, but I have not decided yet and am also talking to various website holding companies to find out what they would charge to design a website,” says Mokoena. Simon Leps, chief executive of Fontera Digital Works, a company that develops e-commerce websites, says closing down the service is a huge loss to small businesses in this country. “These small businesses owners will all have to rebuild their sites and most of them will not find a comparable offering. They will probably have to spend quite a lot of money to get their sites back up,” says Lep. He adds that website hosting companies can charge anything from R2 000 to R100 000. “Use a free provider like Magento where you can start off with a small site and grow but still stay on the same platform. If you’re selling something then it is always better to go with a reputable platform that offers ancillary services as well as a reputable payment facility such as Wordpress's WooCommerce service,” says Leps. 

4) page 4 - February 2015 SMALL BUSINESS CONNECT NEWS Solar companies face closure BY DANIEL BUGAN SOLAR geyser manufacturers are reeling after having lost millions of rands as a result of a procurement technicality. This, according to the Sustainable Energy Society of South Africa and business owners Small Business Connect spoke to. They claim that a number of businesses, which were set up in order to install and service solar geysers for the government’s mass installation scheme, have either gone out of business or have had to lay off staff. In 2012, the then minister of energy Dipuo Peters stated that her department aimed to install one million solar geysers in households and commercial buildings by March this year. In all, R3 billion of the R4.7 billion allocated to the department by the National Treasury waa set aside to fund the rollout of low pressure solar geysers installed at no cost to consumers who reside in low-cost houses. To date, about 400 000 solar geysers of the one million target have been installed, of which 80 000 were high pressure and 320 000 low pressure solar geysers. Chairman of Sustainable Energy Society of South Africa James Green says businesses had gone bust because they had failed to satisfy the Department of Trade and Industry’s (DTI) local content percentage requirements. Local content is that portion of goods, works and services that have been generated and produced in South Africa. In 2013, the DTI ruled under its procurement regulations that both the tank and collector tubes of the low pressure solar water geyser must each have at least 70% local content. “However, because there is not one single manufacturer of tubes in South Africa, companies could not qualify under the DTI’s rules” says Green. He appeals to the department to change the 70% local content requirement and change it to a 70% overall local content. Green says 11 low pressure solar water heater manufacturers had been forced to close, and that about 6 000 jobs had been lost in the installation and manufacturing of solar water geysers in the last two years. A business owner who declined to be named, says many businesses had failed to achieve the required local content level as cost issues meant one had to use imported evacuated tube collectors when manufacturing low pressure solar water geysers. “It is not a viable option to manufacture evacuated tube collectors in South Africa as it will require a significant investment and will have to compete with imports from China whose Solar geyser manufacturers face closure due to not being able to meet the Department of Trade and INdustry's local content procurement criteria. manufacturers benefit from subsidies,” he says. The cost to his business has been significant, he says. This includes having had to invest about R45 million in a low pressure solar water heating plant and equipment; as well as in 20 000 sets of collectors and frames and 2 500 solar water storage tanks. Within the last year the company retrenched 70 people. He says the high cost to ship geysers and the existence of more affordable suppliers overseas, means it’s not feasible to export solar water geysers made here. “Neighbouring countries are an option but the demand is low and the infrastructure is poor. Luckily solar is a very small part of our business,” says the business owner. "There are a number of companies that have achieved the 70% local content criteria" - DTI But DTI spokesman Sidwell Medupe says based on the South African Bureau of Standards’ (SABS) local content verification department there are a number of companies that have achieved the 70% local content for tanks and tubes, with some even manufacturing evacuated tube collectors. The department is confident that these compliant manufacturers will be able to supply the government when it procures solar water heaters from the sector. The government had designated the tank and the evacuated tube collector as being required to abide by the local content rule, because the administrative and regulatory burden to provide local content for all the remaining components of solar water heaters are so high. The designation of these two components relieves manufacturers of the burden of providing local content for small components such as screws, glue, bolts and paint. Medupe says the department at present has no intention to change its 70% local content threshold required for tank and evacuated tube collectors. He adds that the department can in some cases grant temporary exemptions from the 70% local content requirement where exceptional supply constraints exist, but added that this remained the prerogative of the Department of Energy. To date the DTI has not received any indication from the latter that such an exemption would be necessary. At the time of going to press, the Department of Energy had not divulged how many low pressure solar water heater manufacturers have been procured so far. Liable for damages BY MAX MATAVIRE PROPERTY owners should follow the necessary precautions or face potential lawsuits from tenants stemming from damages or injuries incurred during loadshedding. This is the view of underwriting specialist Simon Colman from SHA Specialist Underwriters who says the blame can no longer be placed on Eskom alone as the power cuts have become a frequent occurrence and so businesses should be proactive and take the necessary precautions. Colman says, with the increasing threat of loadshedding, businesses and commercial property owners need to realise the possible liability that may arise from these blackouts and the consequences for their already strained businesses. He adds that this is why that he recommends commercial property owners seriously consider revising their current insurance policies to ensure that they are covered in the event of injury or losses resulting from Simon Colman loadshsedding. "Shopping malls, retailers, restaurants, banks and sport stadiums, for instance, cannot afford to ignore the possible liability and reputational harm that may result from an injury on their premises. Businesses that are operating in high hazard environments, where a loss of power is almost certain to result in injury, must also be sure to take extra precautions," says Colman. Even in the event of unscheduled power cuts, says Colman, businesses must ensure that the necessary precautions are in place to protect their customers. "It is not impossible that a court may be sympathetic to an injured party if loadshedding is a daily possibility. It could be argued that businesses need to guard against even unscheduled power cuts," says Colman. However, business owners Small Business Connect spoke to say they are well covered as they have contigency plans in place. Many say they have generators that kick-in in the event of a blackout, and so their customers were not at risk. Most of them who declined to be named, say the insurance companies are trying to make business by trying to encourage and educate customers to submit claims in the event of accidents occurring during loadshedding. Port Elizabeth's Greenacres Shopping Centre manager Brett Starr says the centre is powered up with four generators which cover lights, elevators and air conditioning. He says businesses that have customers on their premises are most likely to find themselves in "hot water" if a third party is injured during loadshedding. 

5) www.SmallBusinessConnect.co.za NEWS February 2015 - page 5 Tow-trucks in fight over territory BY STAFF WRITER THE tow-truck industry is in turmoil with power struggles over towing rights and territory having culminated in the death of a towtruck driver in Cape Town last month. But, this seems to have done little to cool the ire of the South African Auto Repairer and Salvage Association (Saarsa) which alleges that big “white” companies are monopolising the market and putting small towing and repair firms out of business. The association represents 400 small tow-truck and panel beating companies nationally, but only the Western Cape and Eastern Cape have been affected by violence. Saarsa chairman Len Smith says the trouble began when insurance companies started a preferred insurance service provider system which limited procurement opportunities for small towing and repair companies. The system makes it compulsory for policyholders to use only the services of those towtruck companies that are listed on the insurers’ database. Previously, he says, an unwritten rule existed where the first tow-truck on the accident scene would get the work, which suited small black-owned towing companies that operated in their own areas. “This system is designed to ensure that the previously advantaged companies stay advantaged and does not allow for new entrants into the market who cannot afford to comply with the criteria to become a preferred supplier,” says Smith. He says insurers have now even started call centres to distribute work to preferred service providers. “When there is an accident, the policyholder must contact the call centre and the call centre will advise him which company to give the car to. If you are not on the preferred supplier list you do not get the work. But even if you qualify to get on the preferred supplier list, the call centres still favour the big companies,” he alleges. “But, since 2002/2003 (financial year) more insurers have been giving its preferred suppliers rights to tow cars anywhere, even in traditional black neighbourhoods,” says Smith. This not only affects the small black towing operator but also the small black panel-beating company which relies on the black towing firms to supply them with work. He says in the last 10 years more than 50 small black towing and panel beating companies had to close down. Smith says the association’s members have started a co-operative and are working on a contract agreement between themselves, the government and insurers that would see them receive more work from insurance companies. He said his association hopes to have an agreement signed by 1 March. Saarsa member Chris Olieslager, who owns the Urban Towing and Island Panel Shop, says he has been through hell and back. It was his driver who was found shot dead in the front seat of his towing vehicle. “The police are still investigating and there has not been a breakthrough yet,” says Olieslager. He registered on the preferred supplier lists of insurance companies and says in order to get on the list he had to comply with criteria such as having the right towing equipment, roadworthy vehicles, liability cover, a lock-up facility and skilled drivers who are able to handle powerful tow-trucks. He says insurance companies pay between R2 000 and R2 200 to tow a vehicle. “But being on the preferred lists does not guarantee you work. I’m lucky if I get to tow 50 cars a month and if I do not tow more than 100 cars a month then I’m running at a loss,” says Olieslager. The South African Insurance 07907 Bizspark Collateral - A4 Advert_FINAL_Paths_nc.indd 1 Association (Saia) acting chief executive Viviene Pearson, which represents 60 short-term insurance companies, denied the claims that insurers are favouring white-owned businesses. However, she stresses that just a third of motor vehicles on South African roads are insured, making it impossible for the insurance industry to provide work to all service providers. Director of Dals Auto Group Elvin Nel also refutes the allegations and says insurers use his business because it complies with their rules and regulations. Len Smith 2013/09/13 4:19 PM 

6) page 6 - February 2015 SUCCESS SMALL BUSINESS CONNECT Sun shines on ZaSun success BY AMUKELANI CHAUKE WHEN Soweto entrepreneur Aaron Langa started his handmade manufacturing business using recycled material in 2007, his biggest fear was whether the startup would take off. With an initial investment of R1 000, Langa was not sure if the business would live up to his vision of helping him to create 150 jobs over three years in Soweto. But things are still looking up. In a good month he can sell up to 10 000 products and his business now turns R150 000 a year. Now he plans to set up a manufacturing plant. “We are looking for (factory) premises that cost under R500 000. We envisage that this will grow our annual turnover to R350 000 in the first year with an additional 20 permanent employees from the local community,” says Langa. He says when he started the business he feared that he would not be able to sell his products as marketing was not his strong point. This fear is what led him to outsource the marketing of his products – which include laundry and fruit baskets, placemat sets, coasters, table runners, bags, jewellery boxes and picture frames out of recycled bamboo window blinds material off-cuts. But the immediate success of his products was to come through an unexpected form of marketing – word of mouth. Langa attributes this to the quality of his products that grab the attention of those who see their friends with his crafts. “That’s how we got our products into Botswana, the UK and the US,” he says. While he continues to count his blessings, his journey to where he is today was no joy ride. Born in Soweto in 1967, Langa relocated to Mpumalanga with his family when his father, a policeman, was posted to the province. The family breadwinner, his father suffered a stroke in the 1980s and Langa was forced to fend for himself at an early age by selling tomatoes and oranges to customers in his village so that he could support his family. He believes that this is where he developed his entrepreneurial skills. When he finished his schooling he moved back to Soweto. His first job was with the South African Prisoners Organisation in the early 1990s. In 1997, Langa Sowetan entrepreneur Aaron Langa with his wife Zandile are the owners of hand-made goods business Zasun. joined the then Matthew 25 Prison Ministries International and did spiritual counselling through letter writing, visiting local and foreign prison inmates until 2001. He then started a non-profit organisation Tsusanang for People with Disabilities and Poverty Alleviation, distributing food parcels to people living with disabilities and the elderly, as well as to school pupils. In 2005, he took up other projects like sewing, flower arranging, paper and candle making, among others. In 2007, after losing interest in there, a friend, Stephen Smith, the Tough road for McD franchisee BY YOLANDE STANDER DESPITE making millions of rands in the fast-food industry, there’s been nothing instant about Geoffrey Wood’s success. Now the owner of four McDonald’s restaurants in the Western Cape, Wood’s journey to the top started at the bottom about 20 years ago as a training manager for the fast-food giant when the franchisor entered South Africa in 1995. “I worked through the ranks from training manager to assistant assessor to being one of the first store managers of McDonald’s South Africa. With the experience I gained, I believed the next step was to be an owneroperator,” says Johannesburgborn businessman. After 10 years of being part of the franchise, Wood finally took the leap from employee to owner in 2005. “It was a huge decision and a risk for my financial security. I had to sell my home, my wife’s car and cash-in all my pension money. All my eggs were in one basket and I took the risk. "It was challenging because no one can predict the future,” says Wood. His decision was followed by five years of hard work, dedication and keeping up with the ever-changing hospitality Geoff Wood is the owner of four successful McDonald's franchises. industry. “The key to my success was hard work. The first five years, we all worked so hard. It was not about having a life. It was all about the success of the business and looking back today, it was all worth it,” says Wood. He adds that despite not coming from a family of entrepreneurs, he always knew he wanted to become a business owner and chose the hospitality industry when he decided to study catering at the then Technikon Witwatersrand Hotel School, now the University of Johannesburg School of Tourism and Hospitality. “I always had my eye on becoming a businessman. Before joining McDonald’s, I worked for a number of restaurants and restaurant groups. I owned my own franchise in the frozen yoghurt business which I sold to pursue a career at McDonald’s when it came to South Africa. While studying, McDonald’s was a big topic among students and lecturers as it was popular across the world. And, when the company opened its doors in South Africa, an opportunity presented itself and I embraced it,” says Wood. In May this year, Wood will celebrate 20 years of being a part of the McDonald’s family as the fast-food giant celebrates two decades in the country. “Every day is a different challenge, a new hurdle and that keeps me on my toes. Almost 20 years later, there are new challenges, alternative ways of doing things and because I have ketchup in my veins, I keep going,” says Wood. His dedication over the years has not gone unnoticed and he has received many accolades within the company including the 1997 Restaurant Manager of the Year, the 2005 People Award, 2005 Solid Arch Award, 2010 Operations Excellence Award and most recently the 2013 Chairman’s Award. Wood says the hospitality industry in South Africa is a changing environment and adapting accordingly will determine who sinks or who swims – advice he aims to apply to himself as he plans for the future. “I plan to continue to grow the business by focusing on our people and working towards assisting them in owning their own businesses. The future is very unpredictable but you can work towards it through hard work.” founder of the Papillon Foundation, introduced him to brothers Paul and David O’Brien, who at the time owned Blind Designs. The O’Briens showed Langa samples of placemats they needed to give away to their customers made out of bamboo off-cuts. Langa successfully manufactured the product and designed a holding bag for the placemats. “That’s how I got into this business and I ran with it even though I did not know what I was doing,” he said. In 2009, business began booming and Langa was selling products in Rustenburg, Bushbuckridge and Johannesburg. "I ran with it even though I did not know what I was doing" - Aaron Langa “In November 2012 we went to the Open for Business Expo in Soweto, hosted by the Branson Centre of Entrepreneurship and won a prize for our products which was a six months’ gym voucher at Virgin Active and a foundation course at the Branson Centre of Entrepreneurship starting in January 2013. “Our top of the range products led to the visits from the centre's management team and a few other International guests which included entrepreneur Richard Branson’s daughter, Holly,” recounts Langa. In 2013 Langa and his wife also registered Zasun (derived from the first letters of his wife’s name, Zandile and his own name, Aaron, with “sun: being the English translation of their Zulu surname “Langa”). The company that he started now employs 11 people. 

7) www.SmallBusinessConnect.co.za OPPORTUNITY February 2015 - page 7 E-fresh owner sees R1m growth in only 2 months BY DANIEL BUGAN SINCE joining the E-Fresh franchise family last year, franchisee Toet Wasserman has registered a turnover of R1 million within two months. Wasserman is one of the owners of an E-Fresh outlet which sells fresh produce from emerging farmers at reduced costs to local traders, the public and neighbouring countries. The E-Fresh concept was developed in 2010 by TechnoServe, a company that builds competitive farms, businesses and industries in the developing world, to provide a platform for emerging farmers to which to sell their produce. Ownership of E-Fresh is split between South African agricultural trading firm Farmwise (51%) and TechnoServe (49%). Since the first E-Fresh was established at Elukwatini in Nkomazi Municipality, Mpumalanga in 2010, four new outlets have opened in Tonga, Komatiepoort, Schoemansdal and Burgersfort. These units collectively generate R16 million in revenue annually, while the Elukwatini outlet alone generates R18 million in annual revenue. TechnoServe aims to develop several more E-Fresh outlets throughout South Africa, mostly in rural areas where the organisation supports traditional and emerging farmers. Wasserman bought an E-Fresh outlet in October last year for R1 million in Burgersfort, Limpopo. In doing so, he also invested R30 000 of his own money to lease a building and buy trucks and stock. He says the outlet which he runs with his son, Johan, is growing and he anticipates revenue to surpass the current R1million mark within the coming months. A former TechnoServe employee, Wasserman saw the value of the E-Fresh concept and now sells his produce to bakkie traders, the public and to small businesses. He says he would recommend owning an E-Fresh outlet to others, because of the competitively priced produce that TechnoServe is able to negotiate with emerging farmers for on behalf of outlet owners. TechnoServe programme manager Phillip van Rooyen says for an investment of R3 million business owners can buy an E-Fresh outlet plus a building from which to distribute produce and, within four years, generate an annual turnover of R7 million. He says the R7 million revenue projection is based on several factors. “We do not charge a franchise fee, once you buy the outlet you will have full ownership thereof. We do bulk purchasing from farmers and negotiate better prices. We make sure produce is available when required, hence there is no need to travel to farms or markets to acquire produce which cuts down on costs and time. Furthermore, we also offer managerial support for two years, plus branding.” Those interested can also buy an outlet “for as little as R1 million” depending on where you are located and already have a building, he says. . He says TechnoServe does not provide entrepreneurs with finance to secure an outlet but rather puts them in touch with finance institutions who can undertake to do so. The ideal demographic for an E-fresh location, he says, is around 33.5 people per square kilometre, adding that TechnoServe had identified 43 such municipalities that fit this bill. “(TechnoServe) A worker packs goods at one of the E-fresh outlets will consider applications from entrepreneurs within these municipalities provided they are located within accessible distance from commercial farmers and have a presence of hawkers and traders.” He says the organisation’s objective is for 80% of the E-Fresh outlets to be blackowned. In order to be considered for E-Fresh ownership, an owner must have exhibit a “passion” for fresh produce and be able to come up with money. THE BUSINESS PLACE ACCOUNTING • TAX • ADVISORY The Business Place, an innovative leader in the enterprise development arena, registered professional accountants and tax practitioners, has fused its respective service areas of expertise to bring about The Business Place’s accounting, tax and advisory service offering. This premier agency can meet all your accounting needs, whether you are a small, medium or large business. As a full-service firm, our expert staff of highly trained accounting specialists will take control of all your accounting needs, allowing you to focus on running your day-to-day operation without any additional stress. Our standard of excellence is evident in the long-term client relationships that our team has built, collectively forging our path as an industry leader in offering invaluable services. Contact us for all your business needs so that we can go through your requirements and suggest the best arrangement for your business Contact details: +27 11 833 0340 enquiries@tbp.co.za www.tbpaccounting.co.za www.thebusinessplace.co.za 

8) page 8 - February 2015 DOING BUSINESS WITH SMALL BUSINESS CONNECT Owner proves crits wrong BY DANIEL BUGAN TEN years ago Mossel Bay entrepreneur Molefe Pooe proved his detractors wrong by securing a R250-million contract with stateowned oil company PetroSA. In doing so he was able to grow his company’s turnover over tenfold to R25 million a year. Pooe, the managing director of Metamorphic Engineering, was awarded the contract with PetroSA in 2005 after responding to a tender advertised in the Government Tender Bulletin. He says PetroSA became the first major client for his company, which he started in 2003 by doing occasional once-off projects. Says Pooe: “Previously, PetroSA sourced our services from a labour broker and not everyone was happy with the fact that these services were outsourced to us. “As a result, some personnel (at PetroSA) made life difficult for us by not always co-operating with us. We won them over by completing our work ahead of schedule and by making sure that our work (was) correct so that no one could point fingers at us.” However he says the stateowned company did not always pay his company on time, which affected his cash flow and ability to pay salaries and meet other financial obligations. He says he overcome this challenge by constantly applying pressure on PetroSA to pay. But despite these setbacks, his business has experienced “exceptional growth” over the last three years. “Our annual turnover skyrocketed to between R20 million and R25 million… We went from employing two people to 100,” says Pooe. But it did not stop there for the 55% black women-owned company, whose directors Nancy Nxube, Cindy Phale, Nosipho Manga and Simphiwe Mlaba are all qualified welders and boiler makers. Says Pooe: “The work with PetroSA gave us a track record and credibility in the industry and soon more doors opened for us.” He says his company was required to comply with strict criteria. “First you had to be previously disadvantaged and South African. Then they looked at qualifications Ten years ago Metaphormic Engineering's Molefe Pooe became a supplier to PetroSA and has not looked back. and employment history. You had to have an undergraduate degree in mechanical engineering which I have, and previous exposure in engineering and management which I had.” He also had to provide PetroSA with documentation such as VAT registration certificates and BEE certification. Six months later the company, which provides piping fabrication and maintenance engineering services, was finally awarded a three-year contract to install new pipes and modify old piping at PetroSA in Mossel Bay. Since then the company has Become a PetroSA supplier BUSINESS owners can look forward to doing big business with the Petroleum Oil and Gas Corporation of South Africa’s (PetroSA) if the national oil company's R13 billion procurement spend from suppliers on its database is anything to go by during the last financial year. PetroSA is a subsidiary of the Central Energy Fund, which is wholly-owned by the state and reports to the Department of Energy. In the 2013/14 financial year, the petroleum, oil and gas company procured more than R13.93 billion in goods and services from small companies. This figure is more than the R4.3 billion which was spent on procuring from B-BBEE suppliers – businesses with a minimum of 25.1 black shareholding – during the 2012/13 financial year. Thabo Mabaso, spokesperson at PetroSA, says the organisation’s procurement process is open to businesses who are able to Thabo Mabaso supply anything from pencils to sub-sea drilling equipment and from cleaning to technologically advanced consultancy services. “However, only suppliers registered on our database can apply for tenders as they become available,” says Mabaso. He adds that in order to qualify for registration on the PetroSA database, business owners should ensure that they are able to: • Adhere to B-BBEE credentials such as 50% black and 30% female ownership. • Provide security clearance, which includes potential conflict of interest. • Deliver in terms of the scope of the work. • Provide proof of financial ability and/or credit worthiness. Tenders will not be awarded to businesses that do not have a valid tax clearance certificate. The oil company advertises tenders for goods and services on its website, in the printed media, as well as the Government Tender Bulletin. PetroSA’s supplier development programme, which was launched in 2004 to assist black-owned companies to break into the oil and gas sector, provides businesses with support such as business skills training, mentoring and coaching, technical support, as well as business compliance training. Under its supplier development programme, Petro- SA also provides businesses with access to development finance institutions such as the Industrial Development Corporation should they require funding. PetroSA also organises tradeshows to provide businesses with more opportunities. Mabaso says the oil company also facilitates joint ventures and sub-contracting opportunities with big businesses, which not only provides work, but also improve the skills of suppliers and their workforce. PetroSA's core business is include the exploration and production of oil and natural gas, participation and acquisition of, local and international upstream petroleum ventures and the development of domestic refining and liquid fuels logistical infrastructure as well as the marketing and trading of oil and petrochemicals. It also includes the production of synthetic fuels from offshore Gas-to-Liquid refineries in Mossel Bay. done work for various clients, such as the Department of Agriculture and water utility Rand Water. In 2008 his company also installed carbon steel piping for Eskom’s gas turbineand has manufactured and installed a tank re-enforcing structure for a petroleum tank shared by PetroSA and Shell. "The work gave us a track record...and doors started opening" - Molefe Pooe Pooe says the company also obtained an ISO 9001 accreditation through PetroSA’s supplier development programme. “This means that our quality systems comply with that of established businesses and that the management of our business is based on proven, reliable and consistent principles that ensure quality output as expected by international clients within the industry,” says Pooe. He encourages other business owners to apply to become suppliers to PetroSA. “A major petroleum company such as PetroSA will improve the credibility of your business and give you the confidence to compete on an equal footing with established companies in the industry.” • For more information, go to www.petrosa.co.za. 

9) www.SmallBusinessConnect.co.za STARTING OUT February 2015 - page 9 Cash in on property market BY PAUL CRANKSHAW A WALLED village, cluster complex or residential estate – whatever you call it, this kind of “close living arrangement” has become the norm in South Africa, even in middle and upper class brackets of the property market. They range from small to large – some comprise hundreds of apartments or houses closely packed inside protective walls, sharing the same public spaces. And, they present plenty of opportunities for small businesses. One of these is that of offering a property maintenance service, which helps to keep these homes (and their shared infrastructure) in good shape. This business usually offers a range of services including home repairs, electrical maintenance, plumbing repairs, joinery, general repairs, fire safety, security installation and maintenance, as well as small building work such as the repair of outdoor paving. It may also offer gardening, landscaping, cleaning and decorating services. To succeed in this kind of enterprise, you will need to spend long working hours on your feet. You will also need to supervise your staff well, so you should have good organisational and people skills. You need to be professional, reliable, knowledgeable and have some experience in one or more of your key offerings. A technical background of some kind is vital, as you need to know when a chancer (employee or sub-contractor) tries to pull the wool over your eyes. Most people entering this sector should have a qualification in plumbing, electrical services, building work or carpentry. FOCUS Make sure you start the business with a special focus in mind, so that you can target a segment of the broad potential market. We’ve mentioned the residential complex above. You could also focus on landlords and residential letting agencies, for instance. Landlords own houses and buildings, and rent these out to make money, but they often don’t want to be directly involved with ongoing maintenance – so you could do this for them. Letting agents are often contracted by buy-to-let landlords to look after their tenants (collecting rent, for instance) and to manage their properties. When a tenant moves out, these agencies will often ask you to come in and fix the place up before the new tenant moves in. Also, there will be regular work such as gardening and painting to be done, as well as emergency services such as fixing broken windows, blocked drains and faulty geysers. People who own a holiday home far from where they live also need a reliable local maintenance service to deal with repairs or emergencies. In addition, the government owns a vast range of properties that are used as offices, clinics, schools and social services. They will usually put out an annual tender for the maintenance and repair of these buildings and grounds. Office parks are common in large cities and towns, and the property developers who own and let these spaces will need regular maintenance. GET YOUR NAME OUT To promote the business, get in touch with estate agents and letting agents and offer to give a formal business presentation on the benefits of your services. Visit business parks and get the names of the property’s manager, offer them the same information, and keep in touch with them in case some work becomes available. You can find estate agents through the Institute of Estate Agents of South Africa (www. ieasa.org.za). The website www. saprop.com has a list of major quote based on their actual needs. Make contact with body corporates in townhouse complexes or cluster home developments in your area, and give them a proposal containing your services and rates. Try and get small jobs from them, just to prove yourself first, more work will come once you can demonstrate your ability. And remember, getting customers is only the first step. Keeping them is what will make your business sustainable. • For more information, go to www.cobwebinfo.co.za. residential estate agents, and other information on organisations in the industrial and commercial property development sector. Get some promotional material printed, like business cards and brochures that outline what you do, and what special services you offer. Prepare proposals for potential clients –-- even if you are not sure what they want – so that they can see what your rates will be. Simply set out carefully what you are quoting for. If there is interest from them, they will always ask you for a more detailed Shop with conviction and pride and remember to check for the Proudly South African mark of quality and “Label of Origin” to ensure your first choice is local. Buying local means you help: Be Proudly South African. Buy local to create jobs. www.proudlysa.co.za 

10) page 10 - February 2015 CRAFT SMALL BUSINESS CONNECT Storytelling helps to sell paintings Turn craft into your income HOW is it possible to make a living from a craft? Find out by following the nine-part Small Business Connect series “Crafting Your Business”. PRODUCT IDEA BY NABELAH FREDERICKS ZACHARIA Mukwira uses every chance he gets to communicate with potential customers to sell his paintings to visitors who stop by his stall at Spier in Stellenbosch. This, he believes, is the key to selling his paintings. With the passionate way Mukwira speaks about his craft, it's no surprise that customers are so taken with his products. And, a large part of his time is spent doing what he loves most – painting and teaching children how to paint. Hence, the business's name One Heart Friendship Art Foundation. “Art is a form of healing,” explains the Zimbabwean-born man who developed a love for his craft by working with disabled children in the late 1980s. Mukwira says that after completing school in 1987, he lived with his wheelchair-bound uncle in Bulawayo. His uncle worked for a non-profit organisation that ran a programme that tried to integrate disabled children by using art. “I was always with my uncle as I would usually push him around in his wheelchair so I also started working for the organisation. We were trained to do printmaking which is done using a printing press and started teaching the children to do the same,” says Mukwira. By the 1990s, the organisation collapsed because of a lack of funding due to the political situation in Zimbabwe and Mukwira found another job doing admin duties. But, he still found time to for his craft despite having a full-time job. “I kept in touch with one school that I had grown attached to and continued to teach the children over weekends,” says Mukwira. When he wasn't teaching, Mukwira was commuting back and forth between his home country, Zambia and Botswana approaching shops and art galleries to sell his work. However in 2001, he left his full-time job because the political situation had worsened and the company collapsed. “For the next 10 years, I continued to sell my art like I had been doing, but I also started taking my business to South Africa. “I would take the bus out of Zimbabwe and be in South Africa the next morning,” says Mukwira. MATERIALS PRODUCTION • Finding leads or businesses which might be willing to buy your product, • Setting up individual meetings with the right people in that business, • Presenting the product with sales material and pricing to the right person, • Following up, and • Negotiating a deal. Business-to-consumer selling usually involves you or someone on your behalf interacting with customers in a place where there are many of them, such as a shop or market. Customers are PACKAGING & PACKING MARKETING Zacharia Mukwira believes it is his storytelling that sells his paintings. SELLING He estimates that his income per month was around R10 000. “At one point, I was spending more time in South Africa selling my prints by going to various shops and galleries to showcase my work. I would spend three weeks here then only go back for a week to Zimbabwe to make more prints using the printing machine at the premises I was renting,” says Mukwira. In 2013, he received a call from a friend telling him to move to the Western Cape as his work would be in demand there. How to sell your craft Selling is about telling your story — a bit like what Zacharia Mukwira does with his paintings (see story above). But selling also has to be planned so that you can achieve enough sales to make your craft business profitable. One of the first things is to be clear about is whether you are selling business-to-business, business-to-consumer, or a combination of both. Businessto-business selling is when a business, like a craft production business, sells its products to another business, such as a retailer. In this case, the retailer will then sell the product to the consumer. Business-to-business selling can be a much longer process. It can take anything from one to twelve months. Buyers have cycles and budget periods that make it a more long-term process. Business-to-business selling involves the following steps: PROTOTYPING & SAMPLING normally buying for their own personal use or as a gift for a friend. For your business to survive you need to sell a certain number of products a month to pay for materials, production, fixed costs, living expenses and savings. It is a good idea to have these costs set out in a monthly budget. Work out how many products you need to sell in order to cover these costs. This is your sales target. If you do not meet your sales target your business will not thrive and might not survive. The most effective selling technique is “making it easy for the customer to buy”. Whether your customer is a retailer or someone browsing at a market, think through each step of the purchase and how it could be made easier for your customer to buy your product. This you can achieve by selling them the benefit of having the product, not the product itself. “I first visited Cape Town in 1999 for a conference with the organisation my uncle and I worked for. While we had some time off to do shopping one day, I took my portfolio and went in search of art galleries. I was directed to the galleries in Church Street and managed to get two galleries to agree to stock some of my work,” says Mukwira. He was regularly sent money for the work he did until he lost touch with the gallery. On his return to Cape Town in 2013, he visited the gallery and the employees were surprised to see him after so long. “They gave me the money they had for the work they had sold and asked me to do some more work for them,” says Mukira. He was then told about the craft market in Spier Stellenbosch. Mukwira was encouraged by his brother-inlaw to go to the market with his work and show the management what he could do. “They agreed for me to have a stall only on Satursdays and Sundays, but on my very first day, I was the highest-seller and I sold all my work,” says Mukwira. He was subsequently offered a stall at the market everyday. Here he met a Dutch woman who was involved with a NPO. However, he would not have known it had he not struck up a conversation with the woman who enquired about a painting. He told the woman how he developed a passion for his craft by teaching disabled children to do art. “It turned out that her organisation funds abused and disabled children and the organisation funded a programme at a nearby school where I started teaching art,” says Mukwira. He is now looking for other donors to fund the programme. DISTRIBUTION FEEDBACK This is the seventh part of the series. To get the full series go to www. SmallBusinessConnect.co.za/ craft. If you want to create a successful craft business, you need to understand that every product, involves a journey. In the previous edition, we covered the sixth part of this series, "Marketing". The seventh part of this series, featured in this edition, focuses on "Selling". Read more on this page about Zacharia Mukwira uses storytelling to sell his paintings. The Crafting Your Business series is based on the e-book, "Growing Your Creative Business - a guide for craft producers, designers and other creatives" which was commissioned by the Department of Arts and Culture and developed in partnership with the Cape Craft and Design Institute (CCDI). • Visit www.ccdi.org.za or www.dac.gov.za to download a free copy of the guide. 

11) www.SmallBusinessConnect.co.za REVIEW February 2015 - page 11 Beat the norm with ‘smartcuts’ CHRISTOFF OOSTHUYSEN reviews "Smartcuts How Hackers, Innovators, and Icons Accelerate Success" by Shane Snow. Published by Harper Business (2014). WHY do some companies, particularly those launched of recent, race ahead to achieve great results, while others keep plodding away, not going anywhere, or even facing closure, in the rapidly changing environment of today? This question, which every business owner and entrepreneur should confront, is what Shane Snow answers very eloquently in Smartcuts. So why does he use the term “smartcuts”? Gains achieved quickly, but only with shortterm benefit and not always to the benefit of all involved, he calls “shortcuts”. However, he calls sustainable success achieved quickly through smart work “smartcuts”. Shortcuts are bound to be damaging, while smartcuts create accelerated success, he argues. The idea is simple enough... You have to act outside of the norm and approach things differently from how it is expected to be done. These are clever ways of doing things that will achieve quicker results... A bit like the ladders taking you quickly towards the winning position in a game of snakes-and-ladders. So what are these “ladders” or “smartcuts” in reality. Can you design your life or business in such a way that it is not the lucky roll of a dice that determines your success, but rather the decisions you make and the actions you take? There is an exact method, says Snow, that each of us can follow. In brief, it is about lateral thinking, finding a different way to shorten the path to success; it is about leverage so that hard work is replaced by “clever hacks”; and it is about finding ways to soar past what many would experience as limitations. Some of the suggested smartcuts may seem subversive, like children should not learn multiplication tables and that mentoring may be bad, while others are brilliant in their simplicity. For example, a series of small gains quickly lead to huge achievement, such as illustrated with the trade-game Bigger or Better, where you may start with a toothpick and end up, through your trades, with a TV set. Snow illustrates the principles of using smartcuts to achieve success at hand of the many cases he encountered through his work as a New York-based writer for publications such as Fast Company and Wired, and personalities he borrowed from (mostly American) history. Through these examples the use of smartcuts become achievable, not only in the context of those catching the limelight, but also for the business owners focused on making a difference within the confines of their local influence. Great export opportunities are offered by The Department of Trade and Industry is mandated to promote South African exports to the international market. the dti is actively involved in funding International Trade missions to promote South African goods and services. Do you: • Manufacture a product? • Want to establish an international market? • Have the manufacturing capacity to export? • Comply with international standards and regulations? can help you take your goods and services to the international market. Contact the dti Customer Contact Centre: 0861 843 384 or visit Website: www.thedti.gov.za towards full-scale industrialisation and inclusive growth 

12) TECHNOLOGY page 12 - February 2015 SMALL BUSINESS CONNECT Is Africa home to the next Silicon Valley? BY STEPHEN TIMM CAN planned cities turn regions in emerging economies into the next Silicon Valley? This is what some may be asking, since plans by Russia and now Kenya to boost their startup scenes through massive hub cities, have recently come under fire. In December, critics told the UK’s Guardian newspaper that Kenya’s  Konzo Techno City, a planned $14 billion techno city, won’t solve financing problems facing the country’s rising tech scene.  The city, which the Kenyan government believes can serve as a hub for the east African technology industries, aims to open in 2019 and employ 200 000 people. Critics say the planned location is too far from the capital Nairobi and that funds allocated for the development would be better spent giving commercial lenders incentives to invest in new startups. On the outskirts of Moscow, Russia’s $5.4 billion Skolkovo “innovation city”, has faced allegations of corruption, while construction delays, and political conflicts have dogged the project. The question is whether the project, which kicked off in 2000 and aims to have 20 000 technologists and entrepreneurs living there by 2020, will be able Located in California, Silicon Valley is home to the world's top tech companies such as Google. to stimulate entrepreneurship in Russia.While a team toured San Francisco in November last year looking for new recruits, there are already over 1 000 companies resident at Skolkovo, while a number of big US companies have signed agreements to locate there.  Generous incentives include a waiver on paying income tax, value-added tax, or property tax for 10 years. But, Russian entrepreneur and blogger Anton Nossik, believes the government’s approach of handing out taxexempt money to selected startups is “very wrong”. “Rather than a serious institutional approach, such as passing laws that would give businesses the incentive to innovate, you’re just gambling that some participants in your project will succeed,” he says. Much harder, perhaps, will be to create a culture of risktaking, information sharing and an openness to new ideas, which entrepreneurship expert Vivek Wadhwa says underpins the success of Silicon Valley. University of Cape Town economics professor Get to know your customer by using your biz 'dark data' BY DEREK KUDSEE BIG Data? That’s so last decade. What we live in today is an era of Massive Data – and it’s growing by the second, as we connect everything from our businesses to our coffee pots to create a giant networked economy. The real challenge that companies are facing is how to make sense of this data, and to use this new-found network to create connections that make a real difference. They won’t necessarily admit it, but most companies are sitting on a pile of data that can reach halfway to the moon. The problem is, they are not necessarily doing much with it. It’s called “dark data” – terabyte upon terabyte of information that nobody really knows what to do with, but they don’t want to get rid of it because it might prove useful at some point. Worse than dark, it’s often unstructured, which means it’s unorganised and raw. In fact, research house Gartner estimates that roughly 80% of all corporate data is unstructured. And, it keeps pouring in from everywhere: customers, suppliers and partners. The good news is that if analysed and understood, this avalanche of information can Derek Kudsee deliver a keenly insightful picture of your business at any given time. If you are able to quickly respond to what your markets are telling you – like market fluctuations, or an increase in demand – then you’ll be ahead of the game. To do this though you’ll need some business intelligence solutions that turn this deluge of data into understandable, actionable insights. Welcome to the world of predictive analytics. It’s not as arcane as it sounds. We come across predictive analytics every day without even knowing it: weather forecasts, insurance premiums, credit analyses are all based on this core “enabler” of big data. In a business, it gives you the opportunity to spot trends, anticipate customer needs, forecast wider market trends and to manage risk. Generally, businesses tell us they want to better understand their customers, make more accurate financial predictions and improve their sales forecasting. But, beyond these obvious uses, companies are starting to think more strategically about how they can further use the information they gather to drive revenues and grow their businesses. Here’s an example: during the holiday season, retailers look for ways of gaining an advantage by using predictive analysis. So if a customer bought a gas-powered braai last month, chances are they will need their gas bottle refilled in the next couple of weeks. But what else can you sell them when they come in? How often do they come into the shop? What specific deals can you offer them to make them come in? If you can answer these questions, chances are your bottom line will be looking healthy. Predictive analytics is very much a fledgling market, but it’s on the rise as data volumes grow. In fact, 2013 research from software corporation SAP found that for 60% of businesses, predictive analytics is already an investment priority. Additionally, more than two-thirds of companies think that predictive analytics will be an investment priority for them within the next five years. The use of this technology is putting data firmly at the heart of organisational decision-making, across all sectors and industries. And it doesn’t take a rocket scientist to operate it either: the technology is increasingly intuitive, with easy-to-use interfaces that reflect the realisation that data should not be the exclusive responsibility of one individual or department; it should be front of mind of everyone. Make data visual, current and actionable, and suddenly analytics starts developing the potential to drive real value. Ultimately, though, what will really bring predictive analytics coming into its own is the ability to affect a cultural shift to one of greater collaboration. By avoiding information silos, and encouraging integration across the business and its networks, we will start to see the real power of analytics. It’s going to be a wild ride. Be sure you don’t get left behind. • Derek Kudsee is chief operating officer at SAP Africa. Dave Kaplan believes techno clusters can be a success, if they are managed correctly and if they meet sufficient demand for their development. “Getting it right can help companies to create synergies among themselves, while they benefit from common infrastructure”, he says. South Africa’s own innovation cluster – Technopark in Stellenbosch, one of the country’s promising startup regions could be one of these successes. Opened in 1987 by the University of Stellenbosch with a R10-million loan from the government, the development today has over 100 resident companies. These include local bank Capitec and EMSS Antennas which manufactures radio antennae. Franz Struwig, who in January sold his startup iKubu to Garmin, a multinational company that specialises in GPS, said the three years he has been based at Techno Park had a “massive impact” on his company. Struwig developed a radar to fit to bicycles which detects traffic approaching from behind. He says it’s a strong techno community and fellow tenants are very open, often sharing their ideas with other resident companies or providing him with input on his company’s strategy plan. “So the moment they hear about an opportunity that is a possible fit, you find someone emails you or gives you a call,” he said. Many cities want to copy Silicon Valley. But, Ross Baird, executive director at Village Capital, and Rob Lalka its director of strategy and partnerships, argue that it’s wrong to do so. Silicon Valley-style companies create a lot of wealth, but they rarely create jobs at a meaningful scale They argue that before leaders ask “How can we help startups?” they should first ask themselves: “What are we good at?” and “How can we leverage those assets to solve problems?”. 

13) www.SmallBusinessConnect.co.za ADVICE February 2015 - page 13 Hiring the right employee SO your business is booming and you’ve realised you need an extra person to take some of the load off your shoulders? Congratulations! Hiring the right employee is key to growing your business and ensuring it runs smoothly and successfully. If you can figure out how to hire the right people, you are well on the path to success – but how do you hire the right person for your small business? Here are some tips to help make the hiring process as easy as possible. CLEAR JOB DESCRIPTION Make the job description clear. Often, new employees in small business fall into the “jack of all trades” position and are expected to pick up the slack in multiple areas. To avoid this, make sure the position is clearly defined and that your new employee knows exactly what is expected of them. This will help to avoid confusion and will make sure the new addition to your team isn’t spread too thin, and can focus on doing what they do best – and what they were hired to do. SEARCH CAREFULLY Dedicate some time solely to the search for an employee. As your business is coming along well, it is easy to get caught up in running it, meaning the hiring process can become rushed and lack thoroughness. Choosing the right employee is important and deserves your undivided attention. If you really cannot spare the time, consider hiring a specialist recruitment agency to help you. SELL THE BENEFITS Sell your small business culture. So you can’t offer medical schemes and a company car, but can you give your employee flexible hours? Negotiate some time for them to work from home? Allow them to bring their children to the office after school or nursery? A close-knit, understanding environment with lots of support and guidance? A percentage of company profit if the employee performs well? If you can offer any perks like this, you have a better chance of persuading a candidate that you would be preferable to a big corporation, so don’t be shy to sell the pros of joining your business. RIGHT ATTITUDE Make sure that the interview process determines whether the candidate has the right attitude for your business. This depends entirely on the business itself. However, most startup and small businesses will probably require hard work, creativity and resilience at the very least. Make sure you choose the right employee that is right for your business.. Do not make the mistake of talking too much during the interview – the goal is to find out about the candidate, so don’t be afraid to ask difficult questions. RESEARCH Finally, find out why they left or want to leave their last job. Unresolved issues or conflicts could become problems in the long term at a new position within your company. REFERRALS Last but not least, consider whether your gap can be filled by freelancers. If not, consider asking for recommendations from friends, family or colleagues. If somebody you know and trust will vouch for them, it is likely that you are on to a winner! • This article was first published on www.southafrica.biz4afrika. com. It is a criminal offence for credit providers to keep your Bank and SASSA cards, pins, ID etc. It is illegal and a criminal offence for any credit provider to ask you to leave your Identity Document, ATM/ SASSA card and/or any of your legal documentation. if you are asked by any credit provider to leave with them your Identity Document, ATM/SASSA card or PIN code, it is a criminal offence and you must report them to the South Africa Police Service and National Credit Regulator. Please remember that it is immoral for a money lender to loan against a SASSA grant. 

14) ADVERTISING FEATURE page 14 - February 2015 SMALL BUSINESS CONNECT Companies and Intellectual Property Commision How to register with the CIPC THE Companies Intellectual Property Commission (CIPC), which replaced Companies and Intellectual Property Registration Office in May 2011, is responsible for registration of businesses, cooperatives and intellectual property rights. It is usually one of the first points of call for business owners. But, what does this mean for you as a business owner? You’ve done your research and know what you want to sell or offer your customers, but where do you start with the paperwork? CUSTOMER REGISTRATION Commission's communication specialist Tshiamo Zebediela says to transact with the commission, a business owner will have to register as a customer. A business owner can register online via the commission’s website www.cipc.co.za by completing their details where after a six-digit customer username and password will be provided. “Customers may personalise their passwords when clicking the “Continue” button after registration. A form with an option of 3 questions (i.e your maiden name, pet name and date of birth) to choose from will be displayed. This will be followed by typing the answer to the question chosen. Lastly you will be required to provide a password of your choice where on the last line you must retype the password again and click continue. Registration details are sent to the customer’s cellphone and must be kept safe so as to avoid fraudulent use by someone other than the customer.” To ease the customer registration process at self-service terminals, customers are advised to keep at hand a valid identity number (not passport) and fingerprint verification which the commission verifies through a system that is linked to the Department of Home Affairs. The system at self-service terminals also allows password reset for customers who have forgotten their passwords. Customers also require a working cellphone and email address for communication purposes. If you forget your password or customer code you will not be able to access your company’s details or conduct transaction so keep it safe. BUSINESS REGISTRATION Once registered as a customer, a business owner now has the option to choose from five different business types (private, public, nonprofit, state-owned and external companies) to register his business. Zebediela explains, that if you want to register a franchise you would register a private company, for example. If you would like to register a church, you would register as a nonprofit company. In other cases, such as registering a private school, it could either be registered as a private company or a non-profit company, depending on its objectives. An association of professionals such as lawyers, doctors may be registered as a personal liability company. Stage 1 entails registering your company with or without reserving a company name. Zebediela says under the Companies Act, business owners can choose to have their companies registered without a name (R125) . This is a process currently followed when registering your business through First National Bank. In this case, the company’s registration number becomes the business name. Alternatively, business owners can choose to reserve a company name by listing four names in order of their preference. The cost of this process is R50 which will be debited from your virtual account “Certain characters such as @, #, % and & are not allowed to be used when listing your proposed names. The system will then do a precheck on name availability and you can continue to submit (the rest of your proposed names),” says Zebediela. At this stage, the business owner is provided with a tracking number e.g. 923800974 to confirm their submission. This tracking number will be required at stage 2 of registering a company. Should the business’s chosen name be approved, confirmation of the approval with be sent via email as CoR 9.4. DIRECTOR REGISTRATION The next stage entails registering a company with directors and incorporators. A company must at lease have a minimum of one director and incorporator. This process will cost R125 and require you to log back on to your profile using your customer code and password. A screenshot of the customer registration page on the Companies Intellectual Property Commissions' website. After you have logged on, click on new company registration. The first step will be to provide an ID copy of one of the directors and information relating to that ID will populate (name and surname). To add another director click on the plus sign and enter a 13 digit ID number. Once you have done this click on “Continue” to move onto the next stage. You will now be required to provide company details such as the office and postal address as well as financial year-end. The last stage will require name reservation where you put the tracking number from CoR94 (name confirmation) This is where your name reservation tracking number comes in handy. You can now continue to submit your application which will have a reference number. This form which is your Memorandum of Incorporation (MOI) will be forwarded to the email address linked to the customer code in use. The customer and other directors will have to print out and sign the form at blocks where it says director and incorporator. Once this has been done, the documents along with certified ID copies of the directors and incorporators will need to be scanned and emailed to EservicesCoReg@ cipc.co.za. On completion, you will be provided with a certificate. The turnaround time for business registration has now been cut by 5 days since the launch of the Companies Intellectual Property Commission’s revamped systems. COMPLIANCE OF SCANNED DOCUMENTATION • All documents should be in one email ( do not send separate mails with ID copies, signed MOI and approved name). • Scanned documents must be in pdf. You can also opt to register at either one of the commission’s self-service terminals in Sunnyside, Pretoria or Carlton Centre, Johannesburg. However, customers who choose to use the self-service terminals will have to go through fingerprint identification. This means that all directors will have to be present to register the business. The self-service terminals offer the following services: • Customer registration • Password reset • Name reservation • Company registration with or without a name • Requires a maximum of three directors and only South African citizens • Submission of annual returns • Company and close corporation address changes • For more information, go to www. cipc.co.za. Important registration tips THE Companies and Intellectual Property Commission receive about 30 000 new applications from business owners per month. If you are transacting with the CIPC online, it is important to have the following information on-hand before starting the process. It will help to speed up the turnaround time for your business registration. • Valid SA ID copy that is certified and not older than three month. • Working cellphone. • Working e-mail address. • Funds must be available in your virtual account. When sending documents to the CIPC, please remember that: • Documents must be signed. • Documents must be scanned and emailed in pdf format. • All documents must be sent together in one email. Business owners can choose to make payments via the CIPC's virtual account. Payments can be made to the following bank account details: Absa Bank, Transmission Account and account number 4055 68 1017. Business owners will need to use their customer code as a reference. 

15) www.SmallBusinessConnect.co.za ADVERTISING FEATURE February 2015 - page 15 Put your questions to the commissioner IN a bid to expand the reach of the Companies Intellectual Property Commission (CIPC), the organisation has launched its digital services. In addition, the CIPC also launched an online show “Candid Conversations with the CIPC Commissioner” in partnership with Small Business Connect on 3 February. The show is run via Google Hangouts and allows those who register to engage with the commissioner and business consultants featured on the show. The first show, which drew 86 registrations, featured regular guest CIPC commissioner Astrid Ludin and director of Mastermind Business Support Services Vannessa Naidu. Ludin says she saw the online show as an opportunity for the organisation to reach out to business owners. “We realise that it is hard for people to get hold of us and that this might be a very good tool for people to reach us and get some repsonses from us. So that's really what we are hoping to do,” says Ludin. Small Business Connect publisher Christoff Oosthuysen says that the response to a Small Business Connect online show which featured the commissioner was so good that it resulted in the CIPC online show. “We respect the commissioner and the CIPC staff for being willing and open to go into these discussions with the audience,” says Oosthuysen. The show kicked off with the question “Why does it take so long to register a company in South Africa?”. Ludin responded by saying that registration should be completed successfully at the self-service terminal if a business owner registers only a company. “Right now we certainly have a backlog in our e-services department. "Thank you for taking the time to share with us" - Nadene (show participant) What happens is that you capture your details and our backoffice staff checks this and then approves it.” However, she says the turnaround time is three days but staff are still working on applications dating to January. She admits that these are internal issues which she is trying to resolve and that to combat it they are holding staff accountable where necessary. She adds that further selfservice points will be launched by next year in Cape Town as well as two or three other provinces. General comments from those signing in to listen to the show indicated that the show was quite well-received. Nadene said: " This must have been very stressful for you. Thank you for taking the time to share with us. But, much is needed for customer service". Maggie said: "Respect to Commissioner Ludin. A huge task handled in an amazing gesture of openess and willingness to communicate with us this way. Thanks Commissioner". Melvin said: " Thanks for the time and effort Commissioner, I really appreciate it....Mr (Herman) Tefo (show's presenter) thank you to you and SBC for taking this initiative, I will be sure to register for the next one! :-)". While Dadirayi Agnes thanked the team for putting the show together and answering her question. However, Sello Monyama felt that his questions were not answered. The next show takes place on 17 February. You can register to be a part of the next show to have the commissioner answer your questions via this link http://bit. ly/1Bru61v. • Candid Conversations with the CIPC commissioner airs live every Tuesday at 7pm. You can also listen to a recording of this show by going to the Small Business Connect YouTube channel. FEE STRUCTURE Name Reservation R50.00 Private Company R125.00 Non-Profit Organization with members R175.00 Non-Profit Organization without members R475.00 Co-operative registration R215.00 Changes to existing CC (CK2 and CK2A) free Changes to directors (CoR39) free Changes to directors (CoR39) free Changes to company name R50.00 and R250.00 How to lodge an enquiry via the website Zebediela says business owners who experience any problems can log onto the commission’s website to lodge an enquiry.“Toward the bottom of the displayed home page under useful tips business owners can click on the “Enquiries” with envelope icon. Then click on lodge your enquiry. Use your customer code and Vannessa Naidu Join the CIPC online show CANDID CONVERSATIONS with the CIPC Commissioner 17 February 2015 @ 19h00 Get your access link here www.smallbusinessconnect.co.za/cipc Register via FNB banking SERVICE THE recent move to digital has seen the Companies Intellectual Property Commission experience a few teething hiccups. But, business owners need not fear as the commission has made allowances for this through the introduction of a process that will cater for mishaps. Commission communications specialist Tshiamo Astrid Ludin password to login in the next . Next the screen will give a description, choose the type, provide the keyword in the category and choose from the list what the keyword relates to. Type in your query description and then submit. You will be provided with a ticket number to your enquiry,” says Zebediela. THE Companies Intellectual Property Commission’s embarked on a world first with First National Bank just under two years ago by offering South African business owners the chance to open a bank account while simultaneously registering their business with the commission. The service was aimed at reducing red tape that hamper business registration. Since it’s launch in 2013, the service has already registered many business banking business owners. Commission communication specialist Tshiamo Zebediela says the process takes a few minutes and once completed business owners will be provided with the necessary documentation. The turnaround time for registration via FNB is one day. Business owners can access the service by applying for a FNB business bank account via the bank’s website. Those applying via the FNB website will need to be registered for FNB online banking. Business owners are also able to make use of the service by visiting one of the bank's branches. Once the commission’s registrations fees are paid and the necessary documents uploaded, will the process be complete. Should business owners choose to register their businesses via this service, they will be required to pay R125. “This is the same amount as the commission would usually charge for companies to register so there is no additional costs,” says Zebediela. The company's registration number will be the name of the company. Companies that wish to attach a name to a company after registration through the FNB application, need to reserve a name through the CIPC website. To add a name to the company, a special resolution has to be lodged with CIPC as it is considered an amendment to the company. • For more information, go to www.fnb.co.za or www.cipc. co.za 

16) page 16 - February 2015 SMALL BUSINESS CONNECT LABOUR Contracting outside the law BY JAN TRUTER IMAGINE a situation where an employer does not have a job vacancy, but agrees to accommodate a person as a favour. The person is employed with the clear understanding that if things do not work out, the contract may be terminated without the employee having recourse to the remedies afforded by the Labour Relations Act. Can this be done? Employers should be well aware that it is impermissible to exploit desperate job-seekers by employing them on any basis where basic conditions of employment are breached, such as offering them less than the minimum wage or requiring employees to work hours that exceed the maximum allowed in terms of the relevant legislation. But what about a situation where there is clearly no exploitation, such as where the employer is willing to provide someone with a job opportunity out of the goodness of their heart – will that be viewed differently? In the case of trio Glass t/a The Glass Group v Molapo NO & others (2103) 34 ILJ 2662 (LC), the owner of a small business was approached by a person who “begged for a job”. He did not have any job vacancies, but apparently took pity on her and decided to provide her with an opportunity to work for him. However, it was made clear ENTREPRENEURSHIP CREATES EMPLOYMENT Shanduka Black Umbrellas believes that supporting entrepreneurs will help solve South Africa’s unemployment crisis. By gearing small businesses toward success, we are encouraging job creation through supporting black entrepreneurs as their businesses grow. Qualifying businesses will be primed for sustainable growth through the provision of office space, support services, mentorship, training and access to markets, finance and networks. With a national footprint of 8 incubators across the country, in 7 of the 9 provinces, our incubators are ready to receive your enquiries. Alternatively apply online. To find out more about how your business can benefit and to find your nearest incubator, visit www.shandukablackumbrellas.org. INCUBATORS that if things did not work out, the employment relationship would be ended and that the employer and employee would part ways amicably. As things turned out, the employer was not happy with her performance and told her to leave on the basis that had been agreed on. The employee decided to refer the matter to the Commission for Conciliation, Mediation and Arbitration (CCMA). The CCMA had to address two questions. First, had there been a dismissal (considering the agreement between the parties)? The lesson is clear: One may not contract outside the Labour Relations Act Second, if there had been a dismissal, was it unfair? The CCMA found that the employee had indeed been dismissed and that the dismissal had been procedurally and substantively unfair. The employer was ordered to reinstate her retrospectively. Understandably disillusioned by the outcome, the employer sought to take the matter on review to the Labour Court. The Labour Court agreed with the CCMA that there had been an unfair dismissal, but found that the employment relationship had broken down irreparably. Instead of having to reinstate her, the employer was ordered to pay compensation equal to six months’ remuneration. While the outcome will leave the cynics with much to talk about, the lesson is clear: One may not contract out of the Labour Relations Act. • For more information go to www.labourwise.co.za. THE CHANGE AGENT SBU004 Contact 0861 UMBRELLA or visit our website at www.shandukablackumbrellas.org. Shanduka Black Umbrellas @sblackumbrellas Jan Truter 

17) www.SmallBusinessConnect.co.za SOCIAL ENTERPRISE February 2015 - page 17 Triumphs build brand talking social enterprise BY NABELAH FREDERICKS HIS customer’s willingness to buy his product is what social entrepreneur and part-time television news anchor Pat Pillai believes helped him sell his social enterprise’s developmental programmes to 62 national institutions. Pillai is the founder and chief executive of LifeCo UnLtd SA, a social enterprise with R110 million in assets which develops, supports and funds social and environmental entrepreneurs. His enterprise also develops programmes and course material run through various institutions that allow students to gain, “real knowledge for the real world. We don’t offer qualifications. We bring the practical, hands-on learning experiences that get people doing more, thinking critically, failing early, learning from failure and leading themselves. Our academic partners offer the qualifications.”. “We support entrepreneurs by giving them something a qualification does not offer. Be it in the form of skills or financial support by giving someone with entrepreneurial abilities a R500, or in the case of a more established entrepreneur up to R175 000, to go out and do something for their businesses. We’re not prescriptive. We back people first,” explains Pillai. His enterprise was born out of a dream that started in 1987 Join the online discussion SOCIAL entrepreneurs have a new platform to learn about successful social enterprises. This follows the launch of Talking Social Enterprise, an online “talk network”, hosted at 7.30pm on a Wednesday evening of each month. It aims to stimulate debate amongst social enterprise entrepreneurs and is hosted on the Google Hangouts platform. • To listen to the show, signup by registering via www. TalkingSocialEnterprise.net. Pat Pillai is the founder and chief executive of social enterprise LifeCo UnLtd SA. when Pillai, fresh out of university with a teaching degree, wanted to start an organisation focussed on changing the mindset of young people and help them to break the “dependency mentality”.  But, like many other entrepreneurs, his first attempt at starting a business failed. “I was so naive. I ran the business for about a year and then the following year the business went limp and eventually died,” says Pillai, a part-time E-news anchor. He believes the business failed because of his lack of business skills and his own dependency mentality. “It was heartbreaking. I have never felt so intensely about failure ever. I was all passion and no skill,” recalls Pillai. He spent the next 10 years upskilling himself and serving as an executive director in the media industry as well as working as a television news anchor. Pillai then relaunched his business in 1997 having learnt “three distinct lessons”. “I now knew that I was not the solution to the business. I Market your social successes BY MARCUS COETZEE SOCIAL enterprises market their successes more than the problems they are trying to fix. This is the sixth principle of our Think Like a Social Enterprise series – something that both non-profit organisations and businesses should learn. I remember how easy it was for non-profit organisations (NPOs) to attract funding when I joined the sector in 1996. They just had to provide evidence of the terrible problems that they were trying to fix, and demonstrate that they were the right tool for the job. In my first job with U-Managing Conflict (Umac), I helped former Umkhonto we Sizwe members to find training and employment. These former soldiers were frustrated with the new government. Many were turning to crime to survive and local gangs were trying to recruit them. Although the organisation I was with was very successful at this work, it spent very little time celebrating or sharing its successes. The foundations we dealt Marcus Coetzee with were also more interested in fixing social problems than building their own brands or images. And, since there was a large pool of post-apartheid funding and a limited number of suppliers, it was much easier to get large chunks of funding. My friends did not know what a NPO was. Neither did they understand the magnitude of social problems facing South Africa. I remember thinking how naive most people were. However, the world has changed considerably over the past 20 years. We are all sick and tired of hearing about the social problems facing South Africa and the rest of the world. It has become depressing. When we watch TV, read the newspaper, or check social media we are confronted by images of poverty or environmental devastation. People are developing mental defence mechanisms to protect them from an overload of this depressing information. Youth have become much more informed about the state of the world and the need to do something. However, they are more focused on solutions and successes instead of on the problems themselves. This helps them to feel a sense of progress and feel inspired about their work. Both philanthropic foundations and corporate social investment departments have changed the way they behave. Many are working hard to develop their brands and stand out in the marketplace. No brand wants to be associated with problems – it is just brand suicide. People and organisations are attracted to success. They want to hear and see how your organisation has been able to fix a social or environmental problem. They want to experience your success across all media channels (such as in your brochures and on a website and social media). They want you to provide solid evidence, and not just tell anecdotal stories. Unfortunately, too many organisations still think it’s the 1990s – their communication focuses more on the social problem they are fighting, and less on the successes they have had in fixing it. Sharing success will act as a powerful magnet. It will attract partners, volunteers, funders and investors to your cause. It will help overcome the firewall of receptionists and bureaucracy. It will attract decision-makers and allies to your enterprise. Winning brands want to be associated with winning organisations. • Marcus Coetzee is a strategist specialising in social enterprises. needed other people. Secondly, we needed to find a way to generate our own income and not be donor dependent. Lastly, we had to offer a world-class product,” he says. That same year LifeCo UnLtd was registered as a non-profit organisation that would trade for change - not fund-raise for change. A rate card was sent out to families who could afford to spend some money on their children’s real world knowledge. Pillai managed to rent premises in Johannesburg and began by offering his programmes directly from the organisation’s offices. "Don't be donor dependent" - Pat Pillai By 2007, his organisation had assisted over 5 000 people and Pillai used these figures to clinch a R3-million deal with a university that would run a programme for students using LifeCo UnLtd’s course material. “We developed and licensed our content so that it could be replicated for institutions such as schools and universities to use,” says Pillai. To date, the organisation has supported 56 000 people of which 4 000 are micro entrepreneurs and 35 established entrepreneurs. LCU, the not-forprofit company, has created a trust which owns 100% of a limited investment company.  So, does he have any wise words for other social entrepreneurs? “Develop a product that people are willing to pay for and build an asset-based business. Don’t be donor dependent.” 

18) page 18 - February 2015 INCUBATION SMALL BUSINESS CONNECT Incubator grows over 400 contractors Started in Durban in 2006 with the aim of developing emerging contractors, the Small Enterprise Development Agency’s (Seda) Construction Incubator has since spread to two other provinces and aims to open up branches across the country. Small Business Connect spoke to marketing manager Thandeka Mtshali to learn more about the incubator. What is the name of your incubator and the meaning behind it? The name of our incubator is Small Enterprise Development Agency’s (Seda) Construction Incubator, or SCI in short. How would you describe your focus? We mainly focus on incubating emerging construction companies. We provide the contractors with business and technical mentorship support. Where are you based and from which areas do you recruit new incubatees? Our incubator has nine branches across three provinces. In KwaZuluNatal (eThekwini, Dundee and KwaMashu), Gauteng (Ekurhuleni, Atteridgeville and Mogale City) and in the Eastern Cape (Mthatha, Port Elizabeth and East London). We recruit contractors in the branches’ surrounding areas. How does one apply? To apply, candidates need to contact the nearest branch and speak either to the branch manager or business development officer. The client completes the application form and submits all the necessary documentation and goes through a skills assessment. Sweetness Mbaza has been a part of the Seda Construction Incubator's programme since 2012. Seda helps contractor build new dream Thandeka Mtshali Which businesses are best suited to join? An emerging small or medium construction company that meets the entry requirements such as showing potential to overcome the industry challenges. How long do businesses stay in your programmes? The incubator has two programmes that run concurrently. The duration of the mainstream programme is three years. The outreach programme is open to g How long have you been going for? The incubator was first established in 2006 in eThekwini as eThekwini Construction Incubator. In order to expand the organisation and offer its services all over the country, the name was changed to the Seda Construction Incubator. What are the two key elements of your support that sets you apart from other incubators? The two most important elements that set this incubator apart is the on-site technical mentorship provided for the contractors with a professional engineer to assist and guide where need be during the project. The second element is the office at the incubator which INSTEAD of being discouraged when graduating with a diploma in public management and not being able to find a job, Sweetness Mbaza simply decided to build another dream. And, build she did when she founded construction company Itha Plumbing and Civil Construction in 2004, but she almost lost this dream too when her business stumbled in 2011. That is, until the Small Enterprise Development Agency Construction Incubator accepted her as part of their incubation programme in 2012. How long have you participated in the incubator programme and when will you exit? I started attending training provides contractors with a space where they are able to run their businesses in a professional manner. The contractor has access to the boardroom for meetings, resource centre and a receptionist at a SCI branch. How many businesses have been incubated with your support? We have supported more than 400 incubators since we opened our doors nine years ago, with 200 contractors graduating so far. How many incubatees are simultaneously in your programmes? The incubator currently has 1045 companies in our portfolios across all our incubation centres. What are your fees? There are no joining fees. However, there are instances where contractors have to pay for certain workshops. What commitments do in 2011, but officially joined the incubation programme in 2014. Last year, I was working from home, but this year I am operating from the Port Elizabeth centre. I will exit in 2016 as this is a three-year programme. By how much did your turnover and profitability grow after joining? Even though I started the business in 2004, between 2007 and 2008 I had no work. I had a R1-million contract in 2009, but after the project was over, there was no money. Last year my turnover was R3-million and I now employ 15 staff on the plumbing side and 23 on the construction side. I also went from a level one grading to level three. This means that I can now do work on bigger projects. What are the biggest benefits you’ve received from the programme? It was the marketing and finance training that was lacking from my business. I am still lacking, but I there has been a big improvement. What would you suggest be added or changed to make the programme better? As a contractor who has reached a level three grading, I need to have training on health and safety so that I can start implementing this in my business. I would like to suggest this as a means to improve the programme. incubatees make before they enter your programme? And what commitment do you make to them? Contractors make the commitment to participate in the programme for three years, attend our training and workshops as well as to make use of the resources that are provided to them. especially when we see business owners continue to grow their businesses long after they have graduated from the programme. What is the best thing you heard someone say about your incubator? The best thing we have heard is that we played an integral part in growing their business. What is your biggest wish for improving the support to entrepreneurs in South Africa right now? We want to partner with private sector companies to provide small and medium businesses with projects that enhance the training offered by the incubator. We want to form partnerships with financial institutions to make access to finance easier for small businesses who are part of our programme. We would also like to increase our footprint across the country. • For a comprehensive list of incubators, go to www. SmallBusinessConnect.co.za/ lists. And the worst? The worst thing is that we do not have enough incubators, especially in areas where contractors are based far away from the incubator centres. What was your biggest success thus far? We have had many successes to date, but we consider everytime a contractor graduates a success, Why are you involved in supporting new businesses? We want to help the economy grow. Small businesses create employment for a lot of people. 

19) www.SmallBusinessConnect.co.za DIRECTORY February 2015 - page 19 Business Support Service Directory The Department of Trade and Industry (DTI) Small Enterprise Finance Agency (Sefa) Companies and Intellectual Property Commission (CIPC) Small Enterprise Development Agency (Seda) National Youth Development Agency (NYDA) • • • • • Implements most of government’s business-related policies, including that of small business promotion • Industrial and export development through for instance incentives and grants • Development of small businesses through various DTI agencies such as Seda (see below in the directory) • Direct support to entrepreneurs through incentive schemes and trade programmes • Grants for black-owned businesses as well as those in manufacturing and exporting 0861 843 384  contactus@thedti.gov.za www.thedti.gov.za • • • 086 000  7332 helpline@sefa.co.za www.sefa.org.za Limpopo Economic Development Agency (Leda) North West Development Corporation (NWDC) • • • • • • • • • • Small businesses of the North West Province Startup funding for new businesses General finance for the expansion of existing businesses Bridging finance Business advice, mentorship and coaching Must be registered as a sole proprietor, close corporation, partnership or company Must have valid tax clearance certificate, business profile, business plan and security in the form of a grant, title-deed, insurance policy or investment suretyship • www.leda.co.za Royal Bafokeng Enterprise Holdings (RBEH) • • • The Business Place (TBP) • • • • • • Support to entrepreneurs through various national centres One-on-one support Business opportunities, relevant business information and resources Refer clients to the best suited business development service providers, government resources and financial institutions Free internet access for business research Legal advice, micro-MBA practical training, business-to-business networking opportunities, workshops Free use of the meeting and training rooms National Empowerment Fund (NEF) • • • • • network@tbp.co.za • • • • • • Official economic development, trade and investment corporation for the Free State Funding, business loans, equity and investments Training, coaching and mentoring Partner support services Assist with export-readiness and development services Premises at affordable rates Incentives and special discounts for BEE companies Funding of black-owned and empowered businesses Woman-owned and other targeted business funding Investor Education/NEF iMbizo Post investment mentorship Be older than 18 years, the business must be economically viable and must not be involved in illegal practices, tobacco or gambling 011 305 8000 www.thebusinessplace.co.za • Community-based investment company Strives to improve economic well-being by investing in businesses that will generate returns RBEH teamed up with The Business Place in Phokeng for small business support services to startups, very small, survivalist and micro businesses www.bafokengholdings.com 011 833 0340 Free State Development Corporation (FDC) Finance to small businesses within the Limpopo province A range of information sources such as a quarterly newsletter, monthly information sheets and occasional booklets Business support and training services Non-financial support services 015 633 4700 018 381 3663 www.nwdc.co.za Government’s primary small business funding agency Launched due to merger between agencies such as Khula and Samaf Direct lending products to small businesses Wholesale lending products aimed at intermediaries who have small businesses clients applications@nefcorp.co.za www.nefcorp.co.za Mpumalanga Economic Growth Agency (Mega) • • • • Supports qualifying businesses and individuals from Mpumalanga, who’ve been previously disadvantaged Funds housing, agricultural de-velopment and business growth From R10 000 to R3 million Valid South African identity document, be between 18 and 65 years and access to land or production facilities 051 400 0800 013 752 2440 lesley@fdc.co.za www.mega.gov.za www.fdc.co.za • • • Provide accessible registration services for businesses intellectual property and practitioners Maintain and disclose relevant information regarding business entities, business rescue practitioners, corporate conduct and reputation, intellectual property rights and indigenous cultural expression Increases awareness and knowledge of relevant laws Help take the necessary steps to visibly, effectively and efficiently monitor and enforce compliance with the laws the CIPC administer Business development support for business owners Training programmes for startups, cooperatives and franchisees Sponsor between 60% and 90% of fees of an approved service provider Tender advice, networking and business linkages opportunities Technical support Export readiness assessment for business owners Be 18 years or older, able to run the business on a full-time basis and have a valid South African Identify Document 086 100 2472 0860 103 703 Supports black South African youth between 14 and 35 years old with support and funding Mentorship, skills training and entrepreneurial development Loan funding Health awareness programmes Involvement in sport Business must be economically viable and cannot be involved in gambling, tobacco, property development or any illegal practices Be 35 or younger and hold greater than 50% of the shares in the company and be operationally involved in the business info@cipc.co.za info@seda.org.za   080 052 5252 www.cipc.co.za www.seda.org.za www.nyda.gov.za • • • • • • • • • • • • From intern to owner BY DANIEL BUGAN STARTING out as an intern, Mateboho Sithole has risen to become the owner of a digital publication. She credits The Business Place for helping her on her way. The Business Place is part of a national network of business information and referral centres. It offers entrepreneurs information and support on starting and growing a business. Two years ago Sithole began working at Grazia magazine in Johannesburg as an intern. “I got to understand more about the industry by working for Grazia and was intrigued. After my internship expired Grazia offered me a full-time position, but I turned them down as I wanted to follow my own dream. I decided to dig deep and start my own digital magazine,” says Sithole. Once back in Cape Town, she had to find someone who could give her some direction on how to start implementing her business idea. “I did not know where to go or who to turn to, but then my boyfriend told me about The Business Place Cape Town.” She approached the centre in September last year and was given a free one-on-one consultation with a business consultant who helped her to develop her business idea. “The first thing they did was to help me to register my magazine app, #tagmagazine, as a business. Registering my business was so easy, all I needed was a copy of my identity document and proof of payment of the R390 that I had to pay for the registration. Mateboho Sithole plans to launch her magazine app later this month. Then I attended a business plan workshop that taught me how to develop my business plan. “I was also given information about events and functions I can attend to network with influential people in the magazine industry and potential advertisers. Furthermore, I also received training in human resources and financial management and attended workshops on taxrelated matters.” Sithole, who runs her business from Khayelitsha, says the centre still helps her when she has problems with anything concerning her business and regularly emails her for updates on how her business is progressing. She says she would recommend the The Business Place to others. “I would score them 100% (for their support). They really helped me to turn my idea into reality,” says Sithole. The fashion aficionada plans to launch her township fashion, beauty and lifestyle magazine app this month. “Currently I am approaching advertisers to buy space. This (advertising revenue) is how the magazine will make its money,” says Sithole. At the time Small Business Connect spoke to her, her magazine app was just two months away from its planned launch. She plans to take the magazine app, which can be downloaded free of charge, to other townships, including those in Johannesburg and Durban. The Business Place Cape Town assisted 1 455 new clients between April 2013 and November last year, says the centre’s manager Lavendra Naidoo. • For more information, go to www.tbp.co.za. 

20) page 20 - February 2015 COMMUNITY Request an invite SMALL BUSINESS Connect is giving its readers access to one of the most successful entrepreneurs in the country – Herman Mashaba. This is in response to a Small Business Connect Facebook post where readers were asked: “Just tell is who you would like to hear speak... and Small Business Connect will approach that business personality to appear at one of our upcoming events”. Small Business Connect partnership and event manager Ntsiki Mkhize says readers responded requesting Mashaba be the speaker at the event. Other names that were listed were Richard Maponya, Patrice Motsepe and Abel Dlamini. “His book was reviewed in a recent issue (of Small Business Connect) and we felt his success story would be a good fit to encourage small business owners,” says Mkhize. She adds that the event which is set to take place on 17 February at Oxford Corner in Johannesburg, is open to all business owners who Ntsiki Mkhize think that they can benefit from Mashaba's insight. Entrance is by invitation only and there are only 50 seats available. “We would like to keep the event small and intimate, so people can network and make the most of this level of exposure. We are looking at a group of 50 people,” says Mkhize. SMALL BUSINESS CONNECT Join the discussion on Facebook www.facebook.com/SASBconnect It is for this reason that she encourages business owners to signup for our motivational request that will be sent to selected readers. Mkhize says the event promises an insightful experience to business owners who can expect Mashaba to share his experiences as well as practical advice. “Knowledge is power and that's the best benefit of the event. As well as being able to engage and network with other like minded business owners and hopefully walk away inspired and empowered,” says Mkhize. Business owners who are interested in Small Business Connect news and events can join the Small Business Connect social media pages via www. facebook.co.za/SASBconnect, www.twitter.co.za/SASBconnect or check out the website www. SmallBusinessConnect.co.za. You can also subscribe to our newsletter at www. SmallBusinessConnect.co.za/ subscribe. Send a request to for an invitation to the event with Herman Mashaba. Go to www.SmallBusinessConnect.co.za/events. Readers of the month Kebagakile Raborifi Epheas Fakude Bongani Nxumalo KEBAGAKILE Raborifi calls Small Business Connect a beacon of happiness. Raborifi is this month’s reader of the month and says she first encountered the newspaper in November 2013. “I heard about a National Youth Development Agency workshop and having no travelling money, I was walked to event. This is where I picked up a copy of the newspaper for the first time,” says Raborifi, who adds that she made sure to “dress for success”. She says once she started reading the newspaper, she became impatient waiting for the next edition. EPHEAS Fakude refers to the stories in Small Business Connect as “treasure”. Based in the North West, Fakude says his business consultancy Eagle Talons Solutions helps business owners with business plans, feasibility studies and marketing plans. “I like each and every story in the newspaper, from the success stories to the advice pieces.” He feels that readers benefit from content that is on the directory page. “I would like to see funding institutions coming on board and showcasing their opportunities. I think they should have a column dedicated to this,” says Fakude. IT is the only newspaper that is dedicated to small business owners says Bongani Nxumalo. Nxumalo is the owner of web solutions business Datalligence and is also an avid reader of Small Business Connect who regularly joins the online discussions via social media. “I was fortunate to have read the first copy issue of Small Business Connect in September 2013 at the Department of Trade and Industry's campus,” recalls Nxumalo. Since then he says he has implemented various pieces of advice that he reads about in the newspaper, but says he would like to read more about startups. "I think Small Business Connect enables me to develop skills to grow my business so that it can be sustainable." Ntombi Ndlovu SMALL BUSINESS CONNECT CHAMPION I SEE Small Business Connect as a lifeline to small business owners in the Witzenberg rural area. These are the words of Witzenberg's Local Economic Development department distribution agent Rachel Sauls who has been based at the municipality for nine years. “ The newspaper brings a lot of valuable information to the Witzenberg business community and the general public at large. Not many entrepreneurs are updated with all the business development support there are from the government,” says Sauls. She adds that Small Business Connect brings the local business owners the latest developments on small business support services. Sauls says that from their offices newspapers are delivered to the small business forums as well as the local library. and youth centre. In a matter of days all the copies are "scooped up". “Small Business Connect has changed the view of many entrepreneurs and businesses here. It gives the information a business owner needs to move up in the business life cycle. Through this paper markets are accessed and links with suppliers and customers are made,” says Sauls whose offices have been a distributor for the past 10 Rachel Sauls months. Sauls believes that comments passed on from business owners who regularly visit the offices are that they have learnt best practices through reading advice pieces in the newspaper. “Our small business forum says that their members are now more knowledgeable than before about running a business and where to go for assistance. Small Business Connect must keep up the good work,” says Sauls. She says that the business owners in the area are keen to read more about rural businesses and survivalists. To be featured as one of Small Business Connect's Champion of the month, send an email to Newsdesk@ SmallBusinessConnect.co.za.