30 May 2018: South Africa’s business confidence index fell for the third month in a row in April, but while these measures do provide an indication of sentiment based on various factors such as political developments and economic data, they don’t mean business owners can’t get ahead, say experts.
Jannie Rossouw, head of Sanlam’s Business Market says the success or failure of a business is very rarely determined by macroeconomic factors alone, but rather by the elements of a business that it is possible to control. “Every business operating in every corner of the world has its own local challenges and threats. It’s how strategically business owners can plot out the business within a specific environment that determines its longevity.”
It’s true that successful business owners tend to share some common traits that serve them well as entrepreneurs. Drive, determination and passion are among these and to spot them, you only need to think of businesspeople such as Alex Fourie (Founder of WeFix), Talya Goldberg and Lucas Adams (Founders of Nifty250) and Vusi THembekwayo (founder of Motiv8 Merchant Services). But Rossouw says that without a clear plan that sets out key components such as identifying your exact target audience and deciding on your credit policy, these success stories wouldn’t be where they are today.
So what is within the control of a business owner? Here, Rossouw provides a checklist for unpacking areas of the business that can be steered:
· Design & maintain a solid business plan:
o Have a written business plan.
o Include Key Performance Indicators for all staff.
o Review your business plan regularly.
o Ensure your daily actions mirror your business plan.
· Make your marketing work for you:
o Understand your target market.
o Ensure the elements in your chosen marketing mix speak to your target market.
o Measure your marketing results.
o Determine whether you get a good return on your marketing spend.
· Have an effective credit policy:
o Diligently manage your debtors’ book.
o Establish whether it make sense for you to give credit to customers.
o Assess if your credit policy works
o Ensure that you enforce your credit policy.
· Provide excellent service delivery:
o Get continuous feedback from clients.
o Regularly upskill your staff in service delivery practices.
o Assess how satisfied your clients/ customers are.
· Closely track your finances:
o Understand the core numbers of your business.
o Keep tight control over the finances of your business.
· Ensure clear-cut contracting with suppliers and clients:
o Be closely involved when contracting supplier payment terms.
o Ensure that your credit policy is consequently applied when taking on new debtors.
o Take a deposit which will cover your baseline cost to provide a service/ product.
o Have clear and unambiguous contracts.
· Make your Business FOR and ABOUT people:
o Always be an example for your staff.
o Honour your word at all times.
These are critical components to the successful running of a business, but according to Rossouw,
it’s surprising that more often than not, some of these basic considerations are forgotten. “It’s
never too late to revisit this list and if anything, this guide can be used on an on-going basis
because sometimes it helps to go back to the basics,” he says.