“Have interest rates peaked? The answer is a resounding no.”
These were the words of Reserve Bank Governor Lesetja Kganyago in July 2023. The bank cautioned that the longer-term outlook remained uncertain amid the electricity and logistical issues, as well as the pressure on food prices. All these factors pose a risk to inflation and spending. This in turn affects our businesses.
John started his business after pitching his idea to some friends around the BBQ. He used all his savings for start-up capital, and family and friends provided loans. He could not apply for finance as his credit rating was not strong enough.
John’s scenario is not uncommon in the business environment. According to gviafrica.co.za, 3.3 million of the 5.6 million small businesses in 2018 were categorised as “survivalist firms”.
A few entrepreneurs have pitched their business idea to a group of funders, conducted market research, or developed a business plan and are not prepared to apply for finance.
John can implement some key strategies in his business to be able to apply for finance in the future. These strategies are:
“It was just poor management. Looking at it from a professional point of view, the procedures and policies weren’t there to control things.” (Quoting Frank Rawa.)
Risk is simply defined as a future uncertainty about the probability and severity of something
The Oxford dictionary defines sustainability as the” ability to be maintained at a certain rate or level”. The Collins dictionary defines sustain as the “ability to continue or maintain something for some time”.
The price you charge for your products has a direct impact on the success of your business. And it is one of the toughest questions to answer, especially if you are offering a service. Thus, it is not worth settling on a thumb-suck price or copying the competition.
Are you one of those people that can service your car at home? Most don’t. Instead, they use a professional mechanic to keep things running smoothly and to advise them on potential issues. The same applies to your business’s finances. By Gerty Green
As business owners, we are constantly making decisions. A decision can make or break a business. Complex and unpredictable interpersonal and personal issues are involved in the decision-making process and can result in anxiety. By Gerty Green
We all are striving for something; some wants to reach the stars and others wants to be filthy rich. Yet did you ever take a moment and consider what this thing you are striving for will entail, what will the demands be? By Gerty Green
We all love a good story. For some it is a love story, others like crime and others action. The financial numbers in a business also tell a story to the stakeholders. If accounting is the language of business – then financial ratios help you read between the lines! By Gerty Green
Running a business costs money. Particularly overhead costs can sneak up before you realize it is out of control. Overhead costs also have a direct influence in determining the profit of the business and can contribute to cash flow problems. By Gerty Green
An entrepreneur must channel confidence and optimism but most of the time feels self-doubt and makes assumptions of failure. If you’re asked what is needed, you will probably mention more clients, knowledge, and a template of how to achieve success. By Gerty Green
In this day and age, this concept of needing fuel to keep the generator running is not something unheard of and many business owners can relate. Thanks Eskom for this great way to explain the cash flow concept! Cash flow management. By Gerty Green
My friend was complaining to me that she is working so many hours in her start-up partnership business and does not get compensated for the work she is doing. She gets up at 3:15 am to get everything done, and in peak times even goes a day or two without sleep. This whilst she is still a wife and mother. By Gerty Green
The relationship between inventory management and sales is important because you can only know what inventory you have – if you know what has been purchased and what has been sold – with the net effect being the impact on the cash flow. In order to track the profitability and cash flow, the business owner must make good decisions about key operations in the areas of re-ordering products, how much to purchase, where and when to purchase.
