Corporation. The agency is tasked with fostering the establishment, survival and growth of small, medium and micro enterprises (SMMEs) and with facilitating poverty alleviation and job creation.

 

Nothemba believes that there are many opportunities for small enterprises to succeed in South Africa. The challenge is that small-enterprise owners still battle with thinking out of the box and with being innovative. “Most entrepreneurs want to crowd the same space,” says Nothemba.
 

Besides originality, small-business owners need to have a strong belief in their idea – enough to sell their business concept to the funders (and the next if they persevere). “You must have a bankable business plan, and this requires thorough research on the industry before diving in,” says Nothemba.
 

What Successful Enterprises Share in Common
Successful enterprises share one thing in common: a vision to grow their business. They are wise enough to realise that they need to invest back into their business. “Successful enterprises create sustainable jobs for employees,” says Nothemba.
 

Creating jobs is a mission that the agency takes seriously. “We keep a record of jobs created and we report on the numbers,” says Nothemba. “The truth of the matter is that the private sector is not creating the number of jobs required. We have a drive to financially assist entrepreneurs, but the reality is that not everyone is an entrepreneur and we need to be able to accept this as a society. Entrepreneurs have a responsibility as future job creators and to grow the economy.”
 

Benchmark against the Best
“Perfect the little that you have been given. That is how you build a reputation that will sustain the business,” advises Nothemba. “Your business will grow through word of mouth regarding your quality if you are really small. Do not compete with others, but yourself; ensure that you benchmark against better-performing businesses within the industry to deliver the same quality.” She has insight into how tough it can be as an enterprise when competing to be awarded a tender. Earlier in her career, Nothemba worked for a small auditing firm and spent much of her time completing tenders.

She has little patience with those enterprises seeking short cuts to success and believes that hard work pays. She says that, owing to sefa’s commitment to promote SMMEs, she deals predominantly with small and medium service providers who are in the marketing and communication space. A majority provide very poor quality at a high price, and this is caused by lack of skill. This is because the barriers to entry are very low in the marketing and communication industry. Some people think that they can produce creative, quality work without learning the necessary skills; and some subcontract to cheap service providers whose quality is very poor. This can be a source of frustration. But there are those who are exceptionally good and working with them becomes a wonderful experience and they add value.  

 

First the Application
Nothemba takes care in explaining what she repeats on a daily basis: an application for funding can only be processed once all the required information that is requested is received from a client. “Many clients do not understand the sefa process as we take a rubber-stamp, one-size-fits-all approach to applications. Robust discussion takes place during the application assessment to ensure that it is in line with the mandate and meets all the necessary requirements. The credit committee needs to reach consensus on an application,” says Nothemba.
 

If finance is approved, the interest rate charged is based on many factors. “Developmental impact is important,” acknowledges Nothemba. “Our ultimate mandate is to create jobs, with an emphasis on female, rural, disabled, youth and the disadvantaged, but there is no blanket approach.”
 

Taking Enterprises to the Next Level
sefa provides bridging loans to enterprises to finance working capital. “The enterprise has a contract already. Many of the bridging loans are more about buying or servicing a contract that the entrepreneur has been awarded, and in most cases very few jobs are created” says Nothemba. “When dealing with start-up loans and term loans, it is long term up to a five-year period, which takes the enterprise to the next level.”
 

Need for Innovative Products in Supporting Enterprises
In order to ensure that sefa products are relevant and serve the market that they are intended for, many innovative products like structured finance has been introduced to cater for this. Strategic partnerships are also important in order to create access to some industries. This is done through intermediaries, joint ventures, and Memorandum of Understanding with other viable avenues, especially where there is less representation of the sefa target market.
 

A majority of sefa clients are business people who have almost lost hope through being declined by the corporate banks. So Nothemba appreciates that is it is important to instil a sense of hope and to communicate clearly to the enterprise about what it needs to do in order to meet with success next time or in its initial application to sefa. It is also a reality that not all business plans will be accepted and funded by sefa.  Business outreaches are held once a month in all provinces. Invitations to these sessions is mainly done through business chambers and local economic structures to ensure that all entrepreneurs nationally have access to information.
 

It is heartening to learn that government-funded organisations are taking a proactive approach in their support of small business. The rest is up to the entrepreneur. Small enterprises, we salute you!