Lobby groups: advocating for small businesses

Entrepreneurs are often encouraged to join lobby groups to increase their network base thus their networth.

Apart from providing a community and networking opportunities for small businesses lobby groups like the South Africa Chamber of Commerce and Industry (Sacci) or the National African Federated Chamber of Commerce and Industry (Nafcoc) have materially developed small businesses.

Having a community strengthens the voice of growing businesses to become policy changers. By the natural order of things in SA, the formal sector then takes an interest in the “market”, followed by the greater society.

Government support

These lobby groups work hard to influence legislation, based on the needs identified by the small businesses they represent. These usually pertain to policy but little is seen in influencing a culture of skills development.

More often the inability to pay staff and the lack of structured job descriptions breeds a culture of exploitation of the unemployed party.

Small business lobby groups have an opportunity to drive home this message to South Africans.

By all intents and purposes, small business culture is a self-regulated space that takes a life of its own when certain “norms” are adopted.

The call for small businesses not to be subjected to the same labour laws as big business is therefore legitimate.

Chambers as skills conveyors

A small business will need to harness the skills in the labour market in order to service clients better. Matching businesses to labour is a tough skill on its own since the general attitudes of the labour market are that it seeks permanent employment.

Many entrepreneurs cannot afford to hire experts, let alone hiring permanent staff due to fluctuating cash flows. So the question becomes, how does the small business community cultivate a pool of temporary workers?

Employees who are comfortable with the uncertainty of small business and appreciate the skills development that comes from working with entrepreneurs as well, is one answer.

Finance

The financial needs of a business are understood to be different to that of a household or individual. The formal financial sector, with existing risk rating factors, perceive business risk to be high because of volatile cash flows, low persistence of business, and skills shortage to prove operational soundness.

Despite this, financiers have emerged by way of venture capitalists, enterprise development institutions and banks; showing a growing understanding of business needs. Implementation may be slow but the intent is clear that businesses need to be paid on time, assisted with operational finance and its owners coached on managing money well.

Value add

The core of business is operational efficiency and lobby groups help entrepreneurs get the help they need to thrive. Lobby groups provide workshops to empower existing businesses, many of which start as a one man show or a small group that is trying to figure out the daily steps required for delivering on their promise.

It is therefore encouraged for small businesses to align with a lobby as this will add real value beyond networking opportunities.

-Mpho Mabote is head of research at Bohadi Business Intelligence. A Bloemfontein based market research consultancy. Facebook: @BohadiBusinessIntelligence