02 Aug 87% of South Africa’s entrepreneurs are self funding their businesses
I do believe that anything worth doing you must do it yourself. But surely these stats are scary! 87% of South Africa’s entrepreneurs are self funding their businesses.
This number goes to 95% if you include entrepreneurs who borrowed money from their family.
If this is not bad enough, did you know that South Africa is rated one of the most difficult countries in which to start a business? The 2017 Doing business report rated South Africa 131 out of 190 in terms of ease of starting a business.
With all the Capital that government and private sector has set aside for entrepreneurship, how is it we are still in this position? Every day I meet amazing entrepreneurs doing flippin great things. Like this husband and wife team that has been selling black dolls. They have spent their own money on moulds to get the dolls made and the dolls are funky and beautiful. Guess what their problem is?! They can’t get the dolls into retail because traditional retailers are asking them for ISO 9000 certification which will cost them money they don’t have to acquire.
So your kids and mine will grow up wanting to look like Barbie. You thinking so what, you grew up on Barbie and you are “ok”..right? Well let’s just say when you cut yourself you have zero issues in putting on a plaster that is not your hue! Because if you did care, Bayer and Johnson and Johnson would be making plasters for black skin tones by now. Actually, forget J&J new start ups should have taken this opportunity up by now.
Personal, race and cultural identities are very important as per my previous blog. But this is not about race it’s just pure business logic. Black hair and personal grooming are a multi billion dollar business. You would think if that’s the case then the industry would be so focused in providing products and solutions tailored to this segment. Instead it’s more an after thought.
But who is to blame here, the manufacturers or the consumer? Is it even a blaming game?
Well I am of the opinion that life gives you the leaders, products and services you deserve.
In the eighties the country new the power of their pockets. We used have consumer boycotts. You may have not had political liberation but you could influence corporate decisions by choosing not to buy from merchants that discriminated against you and this proved a powerful weapon. To a point that corporates who supported the government of the day did not want the black consumer to know. I read today that Barlow, Shoprite, McSteel, Altron and PG glass were such companies that claimed to be on the side of the masses and yet behind closed doors were funding a brutal regime.
Do you think we will boycott these companies like all the banks boycotted the Gubta run companies?! Will corporate South Africa hang these companies out to dry and distance themselves from doing business with them? Will we citizens of the country stop buying at Shoprite? I heard that after Afrikaans twitter heard that Spur had banned the guy that had racially accosted a lady in their restaurant, Afrikaans patrons stopped going to Spur. This boycott led to Spur reversing their decision.
Market segmentation, whether it’s children’s toys, hair, band aid, retail or restaurants is about a customer base. It is about meeting the needs of a customer base. In South Africa market segmentation is still very much race related. Good or bad, it is certainly both a blessing and a curse.
I salute the entrepreneurs who take whatever capital they can master with very little institutional backing and try to fill a need that is not only profit driven but one that is a social imperative. These entrepreneurs are rare, in fact they are about as rare as a Chinese cop!