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'Government is doing more than enough'

Johannesburg - Entrepreneurship in South Africa is in a good place, but it needs to be worked at if the country hopes to make a success of its small to medium-sized business sector.
 
That's the word from Judi Sandrock, the new head of the Branson Centre of Entrepreneurship in South Africa. Sandrock recently took over the centre, which has positioned itself to incubate small and medium enterprises (SMEs) in the country.

However, she says the incubation process, which sees small businesses being mentored by experienced businesspeople, needs to be managed carefully if it is to be successful.
 
It is particularly important to have new entrants standing on their own two feet and building businesses which can create jobs.
 
"It is a challenge getting people out of the business incubator process, and this needs to be assessed on a monthly basis," she told Fin24.com in an interview on Wednesday.
 
Incubators have been touted as a way for South Africa to build more sustainable enterprises. But some, including those sponsored by government, have been accused of created SMEs which rely on external managers.
 
With nine out of 10 businesses failing, the belief is that better systems and financial controls, as well as being under the watchful eye of experienced business professionals, can improve this statistic.
 
"There are two ways out of our incubators: you either walk out on your own two feet - or you go out via the graveyard," Sandrock said.

Asked whether government could do more to stimulate small businesses, she responded: "Government is doing enough; in fact, it may be doing too much."

She pointed out that a lot of money is being pushed too easily towards unsustainable small businesses. When these businesses flop, they leave disillusioned entrepreneurs with heavy loans to repay.
 
She praised the Industrial Development Corporation (IDC) for its approach to stimulating industries, singling out electric car enterprises as a model that worked well.

Apart from producing the car, ancillary manufacturing operations - including battery manufacturing plants - were being developed.
 
One area where government could improve is by making it easier for small businesses to be registered. She pointed to international reports which showed that an entrepreneur in a country like Vietnam could register a business in a matter of hours, whereas the same process in South Africa took significantly longer.
 
- Fin24.com
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