Becoming your own boss is not an impossible dream – it depends on the right attitude to turning a little money into more money, say South African business experts.
Ahead of the upcoming Small Business Expo and #BuyaBusiness Expo in Johannesburg, we challenged small business development experts to devise a viable business plan that could start with an investment as low as R1000.
Tshepo Phakathi, economist, banker and Group CEO of Phakathi Holdings, says success starts with leveraging whatever capital is available. Phakathi notes that starting with R1000, the entrepreneur could apply for a 90:10 matching grant or micro loan, giving him R10,000 in capital to work with. This could be used to acquire machinery and raw materials to launch a small manufacturing concern. “I’d opt for something like laundry detergent, for which there is ongoing demand, low input costs and only your labour required,” he says. The entrepreneur should keep reinvesting in the business, later scaling up to employ others, Phakathi says.
With R1000, you might also look for ‘soft targets’ says Phakathi. “Multilevel marketing opportunities reselling well-known cosmetics or plasticware, for example, tend to offer good margins. If you work with a small base you should be able to double your R1000 investment within days. If you keep doubling your money every few days, and keep reinvesting in your business, the model will be sustainable.”
A would-be entrepreneur might also invest in building skills, says Phakathi. The Kaello business incubator will soon launch training workshops priced at around R250, to take prospective entrepreneurs through the process from idea to business and give them the basic tools for starting a business. “People could also gain skills virtually for free,” says Phakathi. “Say you identify opportunities to offer satellite dish installation services – you might volunteer as an apprentice at a company doing installations in order to learn the skill, then start your own small business offering installations in an area with high demand.”
Brian Walsh, a leading authority on entrepreneurship and human behaviour, and founder of The REAL Entrepreneur™ Institute, points out that a successful business can start small: “If you aim to own a large car wash business, for example, you can start with little more than a bucket and a rag. If you work hard and accumulate money, you can reinvest it in growing the business. You shouldn’t wait for access to finance to get started.”
Walsh believes services businesses offer potentially bigger margins than businesses based on reselling. “The catch is, to offer a skilled service, you need experience. You need to get your hands dirty to gain that experience, so it’s important to move around, picking up experience. Offer to do menial jobs within the right companies – for free, if necessary – to gain the experience you want and network with the right people.”
Carol Weaving, award-winning businesswoman and MD of Thebe Reed Exhibitions, believes skills and networking are the key to kick-starting a new business venture. “Established and aspirant entrepreneurs can attend three days of intensive workshops and business training at the #BuyaBusiness Expo and the Small Business Expo in Johannesburg from the 8th -10th September. Entrance is free if you register online.”
The Small Business Expo, presented in partnership with Eskom also showcases a wide range of products and services opportunities for entrepreneurs and investors. “Armed with the right knowledge and just a small amount of stock or equipment, the fledgling businessman can quickly double and grow the initial R1000,” she says.
About the expos
#BuyaBusiness Expo and the Small Business Expo offer one-stop franchise and business opportunities, business tools, information and networking for anyone considering starting their own business, and for those already in business and looking to expand. #BuyaBusiness Expo and the Small Business Expo will showcase businesses for a wide range of skills and sectors. The expos will be staged at the Ticketpro Dome in Northriding Johannesburg from the 8th -10th September 2016. For information, visit http://www.thebereed.co.za/smallbizexpo/ or www.buyabusinessexpo.co.za