13 June 2021

Cliched as it may be, the proverb about teaching a man to fish’ still holds water now more than ever, especially for small business owners.

The proverb says, ‘If you give a man a fish, you feed him for a day but, teach a man to fish, and you feed him for a lifetime’. Like the man in the proverb, small business owners may start their entrepreneurial ventures with a simple outlook: survival.  As long as they get their fish that day, they eat that day.

But, the truth of the matter is that small business owners often fail because they struggle to manage their businesses with this mindset. They need someone to teach them how to fish properly.

Around 70 to 80 percent of SMMEs fail within their first 5 years in South Africa. This means that we have a higher SMME failure rate than elsewhere in the world. Small business incubation as part of a holistic program, like the one offered by Black Umbrellas, is how small business owners are equipped to grow their businesses into sustainable enterprises.

Black Umbrellas is a partner entity of the Cyril Ramaphosa Foundation and, partners with entrepreneurs, enterprises, investors and communities, creating dynamic models to catalyse unique developmental and organisational solutions in order to drive an inclusive and sustainable economic future.

Since inception in 2009 to date, Black Umbrellas has incubated over 2300 businesses and, in that time, the SMEs in the programme have generated over R3 billion in turnover. The value of small business support through programmes like Black Umbrellas’ has been brought into sharp relief in the context of the Covid-19 pandemic.

Hadasha Enterprise started incubation with Black Umbrellas in 2019 with an aim to grow their small baking and catering venture.

“The Black Umbrellas programme taught us how to properly manage the business’ finances, helped us develop ideas for marketing and showed us how to attract new clients,” says Mokgadi Mashapu, one of the three employees of this home-based business.

Mashapu further revealed that the business started with virtually no business management understanding or financial management skills. The incubation program helped them to solve unexpected problems and opened their eyes to new possibilities.

While the three cooks are only able to produce their baked goods and catering menus on certain days of the week in a small home kitchen, their next goal is to move into new bigger premises. With a steady stream of orders for wedding cakes, corporate lunches and biscuits, the pandemic hasn’t set them back in taking the business to the next level.

The pandemic has, however, dealt a hard blow to many of South Africa’s small and micro-enterprises. Without proper cash flow management, training and experts to help them understand how to adapt their business offerings, many businesses found themselves overwhelmed. But, with valuable know-how, other businesses could make it through a time where clients were not keen to engage.

Princess Shabalala, marketing coordinator for Mbhuduma Business Solutions, a small accounting firm in Gauteng, said their clients were afraid to attend physical consultations.

“Our existing clients refused to have face-to-face meetings and we still needed to attract new clients for business. So, adapting to digital communication was how we made it.”

Mbhuduma was also incubated in the Black Umbrellas programme. Armed with agile thinking, this business jumped on the digital bandwagon. Princess set up social media accounts for the firm and secured new business through digital marketing. The firm quickly shifted to video meetings to retain clients and continue operations remotely.

“Trust is a big factor for success as an accounting firm,” says Shabalala, “People want to know their money is safe with you, especially when the economy is struggling. Our clients loved that we went digital and they were on that journey with us. It also showed us just how much we could do with social media. Now, we see how we can expand, and we want to work with business leaders.”

This kind of adaptability is an essential part of business management training; it could make the sky the limit for the entrepreneurial citizens of South Africa. These businesses are just two examples of how good training and holistic small business incubation programmes like Black Umbrellas foster enterprises that help grow the economy.

Entrepreneurs already have the drive, the spirit, and the ambition to overcome the enormous obstacles of growing a new venture. Guidance and support from small business experts goes a long way in securing the longevity of those enterprises who can collectively uplift the nation. And all it takes is time and focus now to prevent problems or failure down the line.