(Cape Town, 17 October 2011): Small, medium and micro enterprises (SMMEs) account for approximately 40% of South Africa’s gross domestic product, and employ more than half of the private sector work force. However, 80% of small businesses fail within their first five years, and according to the most recent Global Entrepreneurship Monitor study, South Africa lags far behind many developing nations in terms of its entrepreneurial activity levels.
The Small Enterprise Development Agency (Seda) now aims to encourage more South Africans to start or grow their own small business, with the launch of Seda Small Business Stars, a national business plan competition with a unique focus on entrepreneurial education.
The competition runs from 17 October until 11 April 2012, and aims to drive sustainable venture creation at a provincial and national level, by providing small business owners – who often struggle to survive after launching into business unprepared – with a more systematic approach to business planning.
“Traditionally, business competitions receive thousands of entries, but only end up benefiting the few who ultimately take home the top prize,” says Seda’s CEO, Hlonela Lupuwana. “Our aim with Seda Small Business Stars is to provide real value for the entire entrant base, all of whom will receive access to free specialised training, designed to strengthen their knowledge of sound business principles, which they can then apply to their business plans going forward.”
Entrants can register for this free training at any Seda branch.
Despite over R4 million worth of prizes on offer, including laptops and software for all winners, as well as a R50,000 cash prize for the overall winner, it is this free, intensive and specially developed training, available at Seda branches across all nine provinces, that truly differentiates Seda Small Business Stars from its predecessors, says Dr. Robin Stead, CEO of the SA Institute for Entrepreneurship (SAIE). The institute, together with Traction, a specialist small business development consultancy, was awarded the tender by Seda to run the competition.
“Whilst funding is certainly critical to the success of a start-up venture, the strength of the business plan will ultimately define the sustainability of a business model,” says Stead. “This training is designed to ensure that all candidates are best equipped to devise realistic plans that can be successfully implemented with a long-term vision in mind.”
Lupuwana says that the competition will help small business entrepreneurs to approach their planned or existing business in a more structured way.
“Passion and business acumen are obviously important in any startup, but too often businesses fail because they have not carefully thought through exactly how the business is going to operate, and made inadequate preparations for potential pitfalls. They also frequently overestimate revenue and underestimate expenses. Our guided process will help to ensure that start-ups are much better prepared to enter the business world.”
Entry to the competition takes place exclusively via the on-line competition system on the Seda website, thus protecting business plan confidentiality, and allowing entrants to work on their entries irrespective of their location.
“The online entry system has been designed to maximise security, as we can ensure total confidentiality of business plans on-line. It is far more difficult to protect printed business plans, especially given the fact that our judges are located all over South Africa,” says Lupuwana.
The competition will be adjudicated by a panel recruited from top business development agencies and service providers. The judging process will identify 20 national business idea winners and 20 existing business winners, all of whom will receive their share of more than R400,000 in cash, as well as laptops and Seda business support to the value of up to R60,000 each.
Special prizes will also be presented to the best woman entrepreneur, the best youth entrepreneur, the best disabled entrepreneur and the best “job-creating” entrepreneur.
The competition is open to any South African citizen over the age of 18 with a business idea or existing small business. From the 17th of October, candidates will be able to register on the competition website, and download the business plan template to prepare their entry. On-line entries will open from the end of October. Entries close on 31 January, 2012.
ISSUED BY: Seda - Small Enterprise Development Agency
MEDIA ENQUIRIES TO: Lindokuhle Nkomonde – Manager: Corporate Communications and Media Relations
TEL: 012 441 1210
Date: Monday, 17 October 2011