As South Africa’s economy is susceptible to global trends, it is imperative that entrepreneurs are cognisant of both local and international economic trends, as they are undeniably going to play a role in the success of their company.
This is according to economist Ulrich Joubert, speaking at the recent series of Sanlam / Business Partners Entrepreneur of the Year® competition workshops.
According to Joubert, any economy operates within the framework of Government policies, be it fiscal or voluntary.
“Every year when the time for the Budget speech arrives, businesses wait with abated breathe to absorb how the imminent rise in costs will impact them financially.”
Joubert explains that a rise in costs, combined with a rise in unemployment substantially impacts South African consumers’ disposable income, which ultimately has a negative effect on businesses, especially SME’s. “Local business owners needed to be vigilant in tracking issues affecting the current economic environment, as well as larger global developments that could potentially influence the growth and success of their companies.”
He predicts rather slow economic recovery in the near future, both from a local and an international point of view.
“The South African interest rate environment will become stable in the next few years, but currency markets will continue to remain unstable. Despite these issues, business owners should be able to survive in the current economic environment if they manage their businesses correctly and keep costs under control.”
He is of the opinion that there is always opportunity for entrepreneurial activity in South Africa.
“In order to take advantage of these opportunities, entrepreneurs and business owners need to identify opportunities and know how best to utilise them from an economic, as well as business perspective.”
Joubert says that the purpose of the national Entrepreneur of the Year® workshops is to educate entrepreneurs and business owners on how economic trends can affect them going forward.
“In order for entrepreneurs to succeed in these economic conditions, they need to cultivate their entrepreneurial spirit while understanding the challenges of the global economic environment.”