How could they possibly be superstitious? Over the years, South African entrepreneurs and business owner-managers have proven the idea of making their own luck. For, they have lived the notion expressed by our legendary golfer Gary Player: “The harder I practice, the luckier I get.”
To be sure, 2013 is probably going to be another tough year in which business owners will have to work as hard as ever to make their own luck. The signs are that the global recovery will remain sluggish and vulnerable to shocks for the foreseeable future. And, even if it starts picking up sharply, it may still be a while before the positive effect is felt by most business owners on the ground.
But an important part of making your own luck is to look out for the positive. This does not only mean keeping your faith that the economy will eventually turn – it certainly will. It also means looking out for the positive aspects that are with us right now.
On a macro scale, keep in mind that:
- Despite all the talk of a decline in our mining sector, South Africa still possesses an estimated $2,5 trillion worth of minerals – still one of the most richly endowed countries in the world. No amount of policy and labour problems will keep international and local investment away from such a bounty for long. Investments will come, and there will be spinoffs for owner-managed businesses all through the supply chain, in adjacent industries and throughout the economy.
- Despite the global financial crisis, South Africa has been receiving record numbers of tourists. Think about how amazing that is: the world has cut luxury spending on a massive scale, yet South Africa is welcoming more tourists than ever before. In the second quarter of 2012, tourists brought in no less than R83.5 billion into the economy, more than the levels recorded during the World Cup. The thought of what the numbers will look like when the world economy recovers is mouth-watering, not only for those in the tourism sector, but for the thousands of suppliers to the industry.
- The rest of Africa, with its consistent growth of more than 5% over the last few years, is still opening up to South African businesses like never before. Every local service provider hired, or every supermarket that a South African retail chain opens north of the Limpopo, provides opportunities for supply chains back home.
- South Africa’s much-anticipated infrastructure spend is still very much on the cards, despite increasing cynicism about the state’s readiness to roll it out in one, massive counter-cyclical push. It will probably be patchy, somewhat haphazard, and much delayed, but it will come. Keep looking out for trickle-down opportunities.
Apart from these macro opportunity generators, an economic slump in and of itself contains many opportunities for business owners (although, because of the pain, these tend to be best appreciated in hindsight). Remember all those flash-in-the-pan businesses that emerged towards the end of the boom years, undercutting your prices and crowding your industry? Nothing like a recession to shake them out, clean out the industry and offer opportunities for greater market share to solid, deserving businesses.
You would know by now that the deserving businesses are those that get the basics rights, the fundamentals of customer service, operational efficiency and financial management, and, where that is not enough to ensure survival, those that are able to find and refine their niche. If you feel you are still too close to the cliff, perhaps 2013 is the year in which you should be rethinking, refining or tweaking your business model, so that you are stronger when the economy turns.
This is in fact what Business Partners is constantly doing. We are going into 2013 with a major new development – a venture capital fund for our entrepreneurs with businesses, concepts, products or services with high-growth potential. Our new R400 million Venture Fund is testimony to our belief in the potential of the South African community of entrepreneurs, despite the difficult times.
Finally, how do you brace yourself in 2013 for the two biggest threats facing businesses apart from the global slump? The first is the major deterioration in labour relations culminating in the Marikana massacre and the recent farm-worker strikes. The second is the catastrophic state of our schools, with 95% of grade nines scoring less than 50% for maths in the annual national assessment. Bad labour relations, badly schooled workforce – the future would seem to be bleak for South African businesses.
But here owner-managed businesses can kill two birds with one stone. The relationship between employer and worker in small businesses tends to be intimate, family-like, personal, and therefore stronger. And one of the most important ingredients of the glue between boss and workers in small businesses is training. Because you generally cannot afford to employ highly-trained workers, you tend to employ off the street and train on the job. Given our schooling system, the owner-managed workshop and office is arguably the most important and productive training ground in South Africa.
Let us make 2013 the year in which we cement our already strong relationship with our workers with an even stronger emphasis on training them – on the job, and by seeking out and sending them on training courses. Do not be put off by bigger companies poaching your workers you have trained up so carefully. You are helping to build the entire market. Also take advantage of the free staff training for small and medium enterprises through sector education and training authorities (SETAs) such as merSETA. And anyway, you will find that the most loyal, and therefore the best workers, will stay with you because you take care of their development. From the outside, people will say you are lucky to be able to have and retain such good workers in an economy like ours. But you will know that it is through your very own efforts that you’ve created your own luck.