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People Must Start Their Businesses

18 May 2016, 08:30

By Thandisizwe Mgudlwa

A new era in township business in South Africa has heralded. 

Yes, the Family Best Buying Group (FBBG) has hit the ground running.

As South Africa welcomes the milestone achievement in the development township businesses, it would be healthy to also look at the economics and politics that threaten or can grow this news township business venture.

With the birth of the FBBG, which is by the way, the first 100 percent black owned buying group in the country, as many some entrepreneurs have alluded, real Black economic empowerment (BEE) has arrived.
Initially, the Family Best Buying Group is an initiative of The National African Federated Chamber of Commerce and Industry and its affiliate, ACHIB ( African Co-operative for Hawkers and Informal Businesses) who joined hands with Advance Cash and Carry, one of Gauteng’s biggest independent distributors of groceries and fast moving consumer goods. 

Advance Cash and Carry is owned by the entrepreneurial Kalla family, owners of Amka Products some of whose brands include Soft ‘n Free, Easywaves, Black like Me, Revlon among others.
FBBG further aims to address the challenges being faced by township businesses including the matter of malls that are mushrooming in townships. 

Minister of Small Business Development Lindiwe Zulu has given her full support to Family Best Buying Group (FBBG) initiative.  Commenting at a recent business gathering she said the FBBG  is a clear testimony of people taking action, “we have people who are saying it’s possible and we are going to do it’’.
Zulu also emphasized the importance of supporting the growth of township businesses. “This partnership will go a long way in stabilising trade and healthy competition among township shop owners,” she said.
According to JT Foxx, the World's #No1 Wealth Coach, as a small business owner in South Africa, "You're part of one of the most vibrant economies in the world."
"But it's more than that. You're a vital part of your community."

Foxx says, "Small businesses are the most integral piece of the South African economy. In 2011 alone, there were 5,579,767 small business owners, which is roughly 10% of the total population."

He notes, "If you don't own a small business, you're probably part of the 68% of people who are employed by them. The bad news is that at least five out of every seven small businesses will fail. And almost every one of those failures could be prevented." According to Entrepreneur Magazine, one of the top 5 reasons South African small business fail is due to the lack of a Marketing and Branding strategy. 

"Many businesses start out with a bang only to plateau a few years later. You wouldn't take a journey without a map. You shouldn't go another day without a marketing and branding strategy. "

And another effective option for developing entrepreneurs is that of business hubs.

Take Raizcorp for example. Raizcorp is Africa’s only unfunded for-profit business incubator model that provides full-service business support programmes that guide entrepreneurs to profitability. 

Drawing on the best practices of business incubator models, worldwide, Raizcorp has created “Prosperation” – its own unique, world-renowned model of business incubation. 

Raizcorp also works with entrepreneurs, corporates and governments around the globe in order to support entrepreneurial development strategies and initiatives.

To date, Raizcorp  has over 900 companies that have graduated from its Prosperator programmes, currently supports 400 plus companies in Prosperation programmes, develops over 3 000 companies per annum in “other” programmes and has 8 physical business incubators known as Prosperators (7 in RSA and 1 in Angola).

Others include discussions and negotiations with numerous African countries,  operates using urban, peri-urban and rural models, employs approximately 109 full time staff, has been profitable since 2006, processes between 10 and 40 applications to incubation programmes per day, employs approximately 109 full time staff, has been profitable since 2006.

Meanwhile, Minister of Economic Development Ebrahim Patel in promoting the Black Industrialists programmes remarks, "If we don’t watch (the creation of black equity stakes in businesses) carefully it simply becomes like a tax on companies. We want to say to fellow black South Africans ‘get into the economy — build things and make things’," he says.
Minister of Trade and Industry (DTI), Dr. Rob Davies,  Minister of Trade and Industry (DTI) adds, 

“The lessons that we’ve drawn and which is also the common understanding of the African continent is that industrialisation is necessary because if we don’t industrialise we are trapped in the most disadvantageous place in the global division of labour as producers and exporters of primary products and as importers of finished goods, that is the most disadvantageous position to be in because the real value in value chains lies in the parts that take place after the delivery of the primary materials,” he says.

As Dr. Davies further explains, “This Industrial Policy Action Plan (IPAP) also represents our intent to progressively upscale our industrial policy. What is clear to all of us is that this economy has not had sufficiently fast inclusive economic growth, GDP growth has not been high enough and the growth that we’ve had has not been inclusive enough to place us in a position where we can see a significant dent in the levels of poverty, inequality and unemployment in our country,” 

“What we are doing is that we are creating an environment, we are creating a support package of measures, we are creating a defensive framework that will allow manufacturing activities to flourish in South Africa, that’s what it’s about.”

The Minister further added that a total of 3 384 private sector enterprises across all provinces were provided with incentive and other support in 2014 to a value of R13.6 billion.
Chairman of the Manufacturing Circle, Bruce Strong welcomed the IPAP, saying that South Africa’s growth is tied to the health of manufacturing.

With the opportunity presented by the Family Best Buying Group, the message has become loud and clear. Start your own business or businesses, innovate, make and produce things in order to make it big in the 21st century economy.

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