Bad Entrepreneur

I get to read quite a lot of negative commentary about SA banks – specifically the big four (Nedbank, Absa, Standard and FNB) – and the way that they deal with small and micro enterprises (SMMEs).

The main comment that is made is that big banks “don’t understand” small business but this seems like a really generic comment and doesn’t help them improve what they are doing.

If I sum up the comments and try and take some of the emotion out of it these seem to be the main criticisms which are levelled against these institutions:

• They don’t lend to small businesses
• If they do offer to lend, they require high levels of collateral and don’t take risks with entreprreneurs
• It’s too expensive for small businesses to borrow from banks
• Banks hound entrepreneurs when they don’t make their repayment commitments

I am not going to try and influence this debate yet but I am going to make some observations and then maybe let the blogosphere and contributors to this blog give their input about what they expect a bank to do to better support small businesses.

• FNB has brought a number of innovative technology solutions including Instant Accounting and potentially PayPal
• Standard Bank is putting a lot of effort into initiatives in the franchising sector and small business networking
• Nedbank is supposed to be bringing a technology driven solution along to compete with PayPal (not totally sure how that is going to work)
• Absa has been throwing money at a couple of grassroots initiatives but don’t really seem to have a “small business identity”
• Sasfin is supposed to be “the bank for entrepreneurs” but you never really see them doing much visible in the sector

So my question to you is:

1. In your opinion which SA bank is doing the most to supoprt small business?
2. What are they doing well?
3. Which products have the most benefit to you as a small business?
4. What could they do to better improve their offering to you as an SME owner?

We’ll rustle up a bottle of something nice for the blogger with the best comments so go wild.

Remember – this is not a bank bashing exercise, this is an attempt to come up with constructive criticism to support the sector. Let me know.

There is no substitute for experience when putting together a quality small business and a good business mentor can help you avoid some of the basic mistakes that start-up entrepreneurs make.

We look back on some of the problems we encountered and in hindsight an experienced mentor could have helped us conserve our cash and build our brand more effectively.

The great thing about technology including Twitter, Facebook and other social media platforms is that you now have some “access” to a lot of these big names. You don’t just have to sit back and buy their books when they roll them out once a year. This new “Meet the Giants” offering from Gibs is a perfect example of what people can access. Check it out if you get a chance.

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I’m looking over my scrawled notes from this evening and trying to decide what my takeaway was from the presentation by trend analyst Dion Chang who spoke at Gibs in Johannesburg.

First up I was a little irritated by listening to that woman whose two “questions” were more like statements on how she did it in HER business. For crying in a bucket, if I wanted to listen to what you had say, I’d book an appointment with you. I came to hear people put their questions to Dion.

Now that, that rant is out the way….

In my humble opinion the presentation itself was a bit wishy-washy. I can’t say that anything ground-breaking came out of it.

Largely it came across as a bit of a rehash of most of the issues those involved in publishing / PR / advertising / online communities have been debating for a while.

Dion spoke quite a lot about the “empathetic consumer” which is a concept I think I can buy into. My short-term concern is that we still need to see the “frugal consumer”.

It is important we don’t mix up the empathetic consumer with the frugal one – something that could be very important if you are planning to launch a consumer driven business.

Two statements from Dion did jump out at me:

• “Networking is going to be a force to be reckoned with” – that in itself is not new but I can see a very clear difference between the people who focus on their own personal networking compared to those who sit behind a desk waiting for things to come to them.  If you are planning to start a business then use every single piece of technology – blogs, Twitter, LinkedIn etc and network like crazy to give yourself half a chance
• “Involve me and I will understand – collaborate” – Dion spoke about seeking out mutually beneficial partnerships. Again it is not new – but the point is that you can go out and use technology to help you find these partnerships. This is a helluva important message for people who are looking to start their own business… in 95% of the instances you will not succeed by trying to do it all yourself.

Anyway – I am going to sleep on those two thoughts for a bit and decide how they might influence my business in the coming months.

If you would like to buy Dion Changs, Flux Trend Review for 2010 – you can buy it online at retailer Loot for R163.

The original press release with Dions “top 10″ trends is further below. Feel free to scroll back and give your thoughts.

Did you realise that 7% of 2010 has been and gone? January has gone before you blinked an eye.

On top of that Daniel Munslow has just said that I should take into account time lost over the World Cup and the traditional South African shut-down for December and its an even bigger chunk of time lost!

Suffice to say it has made me very aware of time and resources.

I was just looking back on some of the plans and budgets that I drew up at the start of the year and it struck me how quickly time moved before work was turned into equiries which were turned into money in the bank.

I know I’m not the only one who made grandiose plans in January – there are plenty of people who have mentioned on Twitter that they had big aspirations for the year and it just served as a reminder to me that time is such a critical part of a start-up businesses make-up.

Every day, minute, hour, month or week that passes where you are not selling your brand and monetising your offering is a day closer to the point where you close your doors.

There is a girl who recently asked for some advice around starting her small service business. She had a lot of time for things like marketing stuff and “brand building” but had no real urgency around getting the invoicing out for the little business she had got and offering attractive terms to get that cash in her bank.

I’ve had to try and emphasise to her that all the fun things count for absolutely zilch if there is not money in the bank.

Every single hour in every day for an SME counts – especially if you are trying to bootstrap the business.

I know it sounds pedantic but how often as a business owner do you corner your staff and ask them whether they’ve delivered on what they were supposed to? How often do you check up exactly what it is that they have done in the last hour?

In a big business people can hide behind a machine that is rolling over on its own momentum, but you don’t get the same luxury in a small business.