Wednesday, March 25, 2009

SEDA small business support

SEDA, the governments small business support arm is as committed as ever to supporting small business in South Africa. Not only have SEDA supported numerous entrepreneurs from disadvantaged backgrounds over the last few years they have also put their money where their mouths are when it comes to Business Planning support and funding for new ventures.

In a recent interview, Hlonela Lupuwana, acting CEO of the department of trade and industry’s Small Enterprise Development Agency, spoke to ANNE HUTCHISON about Seda’s commitment to the Business LaunchPad

SEDA is a key partner in the Business LaunchPad competition, as its national network of branches and enterprise information centres help to ensure that entrepreneurs get to know about the competition.

Business planning, which is what the competition is about, is the core of Seda’s business,” says Hlonela Lupuwana, Seda’s acting CEO, commenting on the importance of its involvement in the FNB Enablis Business Plan Competition.

“At a more strategic level, Enablis brings public and private sector partners in the business of SMME development together to collaborate on this project, which is a good example of the kind of synergy we support,” she adds.

Seda began working with FNB in 2007 — to assist South African entrepreneurs gain the necessary skills to run a sustainable and competitive business — about the same time as the bank became involved with the Enablis LaunchPad. Since becoming an active partner, Seda’s role has extended beyond simply being a co-sponsor to being closely involved in distributing entry forms, assisting with the adjudication of entries and identifying how entrants can be assisted through other Seda programmes.

As a key driver of SMME development to reduce high levels of unemployment and poverty, Seda is mandated by the department of trade and industry to boost the sector through its Integrated Strategy on the Promotion of Entrepreneurship and Small Enterprises (ISPESE), aimed at identifying factors that contribute to the success of the small business sector.

Recognising the need for focused SMME support, the ISPESE provides a wide range of non-financial business development support services to entrepreneurs in the pre-start-up, start-up and growth phases, as well as to businesses in distress. Through its 43 branches countrywide, Seda’s services include business registrations and planning, co-operatives’ support, training and mentoring, and access to markets, finance and technology.

Lupuwana believes that the Business LaunchPad gives fresh impetus to the SMME cause.

“It identifies existing and aspiring entrepreneurs and encourages them to sharpen their business acumen, improve their business plan thinking and develop writing skills,” she states. “Showcasing the winning entrants as role models also encourages entrepreneurs.”

Lupuwana says she felt “incredibly inspired” when she attended the adjudication panels for the finalists. “These were people from all four corners of the country, whose business ideas and passion had been recognised, and you could sense that whether they won or not, they could continue with the added confidence of knowing their idea had been selected out of the thousands of entries.”

She says Seda aims to move informal enterprises or businesses in the seed stage to viable concerns that are registered and can grow by taking advantage of the available support services. “The ultimate goal is to transform ‘necessity’ entrepreneurs into ‘opportunity’ entrepreneurs, where entrepreneurial thinking is not just based on subsistence but on properly identifying and harnessing available business gaps.”

Seda offers a number of structured programmes. The Technology Programme, for example, uses the “incubator model” to fast-track the development of small businesses in a range of industries from platinum beneficiation to the manufacture of essential oils.

Businesses are provided with premises, manufacturing machinery, advice on marketing and general business management for an initial period, after which time they are expected to have acquired the necessary skills and market reach to go it alone.

“The aim is to give entrepreneurs time to get up and running in a protected environment by providing the necessary access to resources, intensive mentoring and support that will make their business viable in the shortest time possible,” says Lupuwana.

Seda’s Export Development Programme exposes SMMEs to the international business arena and global best practice through TradePoint, a global system which assists small enterprises to trade internationally and access information by using electronic commerce technologies.

Other key areas of assistance are Seda’s Franchise Support Programme and Co-operatives Programme. It also focuses on growth industries: for example, its Tourism and Cultural Industries Programme supports both direct and indirect tourism initiatives through networking and training.

Partnerships such as that with FNB and Enablis are crucial to achieving Seda’s goal of establishing a formal and sustainable small business network on a large scale, says Lupuwana.

Other local partners include business development support agencies and a range of development finance institutions, as well as dti-appointed finance entities such as Khula Enterprise Finance, the National Empowerment Fund (NEF), the South African Micro-finance Apex Finance Fund (SAMAF) and sector-specific finance bodies.

“We also benefit from the experience of global partners who provide technical and, to a limited extent, financial support.”

A major partnership is with Finland, following the signing of an agreement to support Seda with core funding of around R45-million and technical assistance of about R7-million over four years. Another is the Tri-Nations partnership between representative groups of Seda, the Brazilian Micro and Small Business Support Service (SEBRAE) and India’s National Small Industries Corporation Limited (NSIC).

An annual Tri-Nations Summit on Small Business is part of the initiative between India, Brazil and South Africa to promote co-operation and exchange.

“Small business success is the cornerstone of economic growth in South Africa, and Seda initiatives and partnerships are pivotal,” says Lupuwana, emphasising that collaboration is a key component of the ISPESE strategy.

We acknowledge The Times newspater for their contribution to the article

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