Developing a Strategy to Grow in the Short Term
South Africa has limited growth potential in the short term. While government gets its house in order, we need to make sure that, as business owners, we have the correct strategy in place to meet the challenges that face us. Real value lies in the process of
putting the plan together. The act of planning helps you think things through thoroughly, and to critically re-assess your assumptions and ideas. A good strategy needs to be short, sharp and coherent, with a strong opening paragraph illustrating where you are going and how you aim to get there.
STRATEGY AND GOALS
- List your goals and your mission statement
- Develop a strategic plan of how your business will achieve its goals
- Reflect on the sustainability of your venture – is it intended to be short term or a long-term venture?
- The Team – your staffing needs and ways to meet them
- Suppliers – make a list of everything required including the name of the suppliers and their prices and terms
- Location – explain the location outlining the details (address, rent, taxes, and so on)
S.W.O.T ANALYSIS: The strengths, weaknesses, opportunities and threats of your venture
- Financial numbers – cash flow, sales forecast, personal expenses, profit and loss
- List the amount required in a budget including the source of capital (if applicable)
- Be realistic. The numbers need to reflect that your venture is a good idea and that your assumptions can be turned into a positive cash flow which in turn will translate into profit
- How long will it take to break even, how long will it take to create positive cash flow?
- Conduct a target market analysis
- Who or what is your competition? How much of the market do they own already?
- What is your competitive advantage – is it your pricing, niche product or service?
LEGAL AND COMPLIANCE
- Licenses and permits – note whether they are required and how you will obtain them
- The trading vehicle through which you intend operating
Keep detailed notes on your sources of information and the assumptions underlying your financial data. The document will become a “living” one which you will be able to refer to, revise and develop as your business changes and grows.
Your strategy and mission statement will assist you with performance measurement and in assessing your targets and goals. If you require professional assistance to develop a strategy do not hesitate to contact us in this regard.
The latest social media phenomenon in South Africa is a Facebook page started just over a month ago which now has 700 000 followers!
It’s a collective of positive sentiments about South Africa from people of all walks of life. Now it looks set to play a role in job creation and stimulating the economy. A positive step in any one’s books!
See the announcement below:
“#IMSTAYING has broadened its mandate as suggested by our members to implement a number of initiatives aiming at helping to stimulate the economy through SME business and job creation in this sector.
In order to do this, the newly formed NGO has a three-prong approach; National events, Crowdfunding and Merchandising. All funds raised will be used to implement business initiatives in the micro and SME space to open their doors, scale their business or create collaborative opportunities to work together. Naturally a small percentage of funds raised will be used on operational costs.
“It was imperative that we partnered with a reputable company that is totally transparent and properly geared towards helping us achieve our objectives. Donations based crowdfunding platform, BackaBuddy was the obvious choice for us given their profile and the fact that I have personally worked with them before to help raise funds. Their level of care and professionalism has always stood out” says Petzer.
BackaBuddy will hold funds for each of the initiatives, each of which will be visible for anyone to view via their portal or on the #ImStaying website – www.imstaying.co.za
As #ImStaying has become a collective movement of the people, any public funds collected will be put to poll on the #ImStaying Facebook Group page and members will be asked to vote via an online poll as to where the funds are allocated. This action in itself becomes the collective’s decision and will certainly be a game-changer in the NGO space.”
An innovative approach to assisting business initiatives. Let’s hope they succeed as this kind of intervention can only assist in driving the economy.
In a very recent public spat, the board of Old Mutual and its CEO have had an acrimonious relationship, with the CEO wanting to declare the entire board of Directors delinquent after having been fired for conflict of interest. Being declared a delinquent director is not a common occurrence and we thought it may well be of interest to list the ground for Delinquency.
To be declared delinquent a director must have:
- Acted as a director or prescribed officer whilst ineligible or disqualified by the Act or by the Close Corporations Act
- Acted as a director in a manner that contravened a probation order
- Grossly abused the position of director.
- Took personal advantage of information or an opportunity, or intentionally or by gross negligence inflicted harm on the company or a subsidiary of the company
- Acted in a manner which reflects “wilful misconduct” or a “breach of trust” (unauthorised acts, reckless trading or fraud)
- Was repeatedly subject to a compliance notice or similar enforcement mechanism
- Was personally convicted, at least twice, of an offence or subjected to an administrative fine or penalty in terms of any legislation
- Within a period of five years, acted as a director of one or more companies or was a managing member of one or more Close Corporations (CC’s), or controlled or participated in the control of a juristic person (irrespective of whether concurrently, sequentially or at unrelated times) that was convicted of an offence or subjected to an administrative fine or similar penalty in terms of any legislation
All references to director apply equally to members of CC’s who are participating in its management regarding probation and delinquency, and all references to a company applies equally to CC’s.
Should you have any queries or require clarity in this regard feel free to contact us for professional advice.
Medium Term Policy Budget Statement (MTPBS)
The Minister of Finance, Tito Mboweni, will deliver the MTPBS on the 30th October 2019 at 14h00. This speech is seen by most as a watershed moment. If dramatic action is not taken to address all the current economic ills of South Africa, the ramifications could be dire with ratings agencies and international investors effectively turning their back on South Africa.
In the last year government attempted to address the following key issues with limited success:
- Growth enhancing reforms
- Re-prioritisation of public spending to support growth
- Enhancing infrastructure investment
- Addressing health and education issues
- Investing in municipal social infrastructure
State Owned Entities however remain the Achilles heel of government. The likes of SAA & Eskom continually draining the fiscus, surely now is the time for radical change. The minister earlier in the year tabled treasuries proposed reforms for comment, it will be interesting to see what is unveiled on the 30th October!
As per usual we will review the minister’s speech and will keep you informed on the way forward.