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Learn how to be a good entrepreneur - expert

Jun 25 2015 20:15
Carin Smith

Cape Town - As a general rule of thumb a micro-enterprise should not think of expanding unless it has had at least three years of good profits, according to financial and legal expert Thayn Niemand.

He was the keynote speaker at a micro-enterprise and informal economy summit hosted by the City of Cape Town and Nedbank on Thursday.

"Ask yourself why you want to expand. Is it an ego thing? Expansion should be about profits, because expanding just for the sake of it is not good," Niemand told the audience consisting of micro-entrepreneurs and would-be entrepreneurs.

At the same time he is worried that businesses are not making it, despite it having become easier to get finance in South Africa. Research shows the main reason business owners decide to quit is a lack of profits.

"In my view it is very important to create more on-the-ground education about entrepreneurship," said Niemand. "There is a big debate about whether entrepreneurs are born or created. Sure they are born, but I believe they can also be created through practical training rather than the mere handing out of certificates."

He said successful entrepreneurs are usually passionate about what they do. They are problem solvers.

"Be punctual and be proud to be proud of what you do as an entrepreneur. Be proud of your appearance and how your vehicle looks. Make sure there are no spelling mistakes on your brochures. Be proud of how you deliver your product," said Niemand.

"An entrepreneur must have crystal clear goals and providing a good product must be a given. Set specific, measurable, attainable and realistic goals for your business."

He further pointed out that successful business owners know how to cost their product. Competing on the cheapest price is not the best approach.

He made it clear that one can learn how to do proper cost pricing and how important it is to focus on things like your breakeven point, budgeting and cash flow management.

"One can learn these kinds of things, you don't just have to be born with this skill. Educate yourself by reading up on relevant topics," emphasised Niemand.

"It is also important to educate and train your staff. People say it is too expensive to train staff and then they leave. My response to that is to just imagine not training your staff and then they stay. You will get more customers if you train your staff in sales and marketing."

It is also important to measure marketing success and to be skilled at administration.

"Know what is done in your back office. The cubby hole of your bakkie is not a filing system," said Niemand.

"And don't just put your business plan in the bottom drawer. You drew it up and got funding based on it for a reason."

nedbank  |  entrepreneurs  |  small business
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