Outside of their own organisations’ enterprise development initiatives, procurement departments across SA can offer numerous avenues for incubated entrepreneurs to access the country’s industry through agreements with various incubators.
An incubation model cannot stop once an entrepreneur’s skills gaps have been ‘treated’ – the model must give entrepreneurs a means of accessing industry at large, says Shawn Theunissen, of Property Point, Growth Point Property’s enterprise development arm.
There is no doubt that working closely with procurement teams to incubate a small business supports incubators, but procurement’s involvement cannot end there if SA is to reach its entrepreneurial potential, says Theunissen.
Working closely with procurement teams throughout the incubation of a small business provides additional support where necessary, especially in the early days of the entrepreneur implementing new skills. But equipping an entrepreneur to spot gaps in the market is the job only half done: entrepreneurs need a means to access industry.
Survivalist versus sustainable
Much like the fields of education and healthcare, entrepreneurship appears to be something of a“calling”. However, in South Africa it has become a necessity for many.
A closer look at the country’s small, medium and micro enterprises (SMMEs) reveals that many are not entrepreneurial by design, but rather by necessity. As such, SA’s fairly large pool of SMMEs is predominantly survivalist.
While survivalist enterprises fulfil a particular role in the economy, their nature does not encourage job creation as they typically support the entrepreneur’s hand-to-mouth existence. Operating in areas saturated with similar offerings, entrepreneurs usually run their businesses themselves – with their takings each day dependent on their individual sales prowess and, more often than not, willingness to undercut their competition. Price becomes the differentiating factor and keeps margins very low, limiting the ability of the enterprise to grow or support additional staff.
To deliver on job creation and the stimulation of economic growth, we need to find a way to move away from “survivalist” and promote opportunity-based entrepreneurship.
For more information on how procurement can build and support SMEs contact Property Point.