There are a myriad of support programmes offered by government departments to assist business owners grow their enterprises. In the main, the schemes are well designed and if they were properly administered and executed, would go a long way to achieving the goals of growing sustainable businesses.
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Sadly, I am finding more and more that many of the schemes appear to be nothing more than empty promises, and pardon the cynicism, cheap political publicity.
Applied
Take a recent case in point: I was approached by a local, women owned, furniture manufacturer, who had applied to the Department of Trade and Industries’ (DTIs) Black Business Supplier Development Programme (BBSDP) scheme to fund the purchase of a machine.
The scheme offers a 50 percent grant towards the purchase of equipment to enhance production capacity. On the strength of an approval letter, she placed an order for the machine, and paid a substantial deposit, in anticipation of her grant being paid out in a reasonable time to cover the balance of the cost.
No response
Nearly 18 months after the approval letter, she has had nothing but empty promises from the DTI, and has had to fund the balance of the payment for the machine from her own working capital. E-mails to the DTI go unanswered, as do phone calls to their offices.
While we accept that the integrity of applications need to be confirmed in terms of conformance and guidelines, urgent attention is warranted to enhance the efficacy and speed in processing them.
The situation has placed her operations under severe stress, as her initial business plan did not foresee her using her working capital for this purpose.
Political gimmick
A further case in point: earlier this year the KwaZulu-Natal MEC for Economic Development announced the creation of a R50-million fund to support youth-owned enterprises. To underscore my scepticism, then-MEC Sihle Zikalala was reported to have said at the launch that the fund was no ‘political gimmick’ (IOL Online February 1, 2019).
To date, and nearly six months after the launch of the Fund, I am yet to hear of any money being disbursed to potential beneficiaries. Further, information or updates as to the progress of applications is hard to come by.
Inefficiency
My personal experience with the DTI’s schemes for exporters, from the late 2000s is very similar. The key difference was that we were in a fortunate situation to be able to self-fund a lot of our marketing initiatives in anticipation of receiving the grant payment at some future point in time.
The reality is that most emerging small businesses do not have the resources to outlay their own capital, and more often than not lose out on opportunities due to the sheer incompetence or inefficiency of the department concerned.
After matriculating, Vijay Naidoo studied Economics in the UK. Upon his return, he joined the family construction business as MD for 10 years.
He subsequently joined his sister in their furniture manufacturing business as director for quality assurance and operations. He was responsible for all quality aspects of their products, and led the project to the business achieving an ISO 9000 quality accreditation. As an export focused business, this was important for our international competitiveness.
Mr Naidoo has an abiding interest in quality management and productivity improvement, particularly in manufacturing.
More recently, he has focused a lot of his time on giving back to the community by way of mentorship of small businesses and sitting on the executive of the South Coast Chamber of Commerce. He also sits on the Board of the Ugu South Coast Development Agency.
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