Die problematiek van die klein ondernemer met spesiale verwysing na konsultasiedienste as metode tot hulpverlening aan klein sakeondernemings

Abstract

The extinction of small business has been gloomfully predicted for the last hunderd years. Instead of vanishing from the economic scene, however, small business is today still holding a prominent position in Western capitalistic systems. The fact is, that small business is increasing in numbers, in most countries of the Western world. Small businesses are, however, encountering problems and difficulties of increasing magnitude. These problems create demands for change and adaptation and in some cases, threaten the very existence and further expansion of small business. The ways in which the problems of small business are going to be solved will determine whether small business will have to continue to struggle under hostile external circumstances and in many cases, ignorant internal conditions. The future development of small business will also- have an influence on the free market economic systems of the world. It is a specific objective of this study to take a closer look at the small businessman, his characteristics and problems, his small business, its operation and its place, relative position, and function in the modern economic order. A further objective is to examine various ways and means of assistance to the small business sector worldwide, with emphasis on consultation services as a method of rendering assistance to small business. Chapter 2 of this study is devoted to the question of defining a small business and examining some of the terminology used in describing the small business sector. Various definitions and descriptions, as used and interpreted by academics, researchers, governments and organisations have been studied. From these approaches and interpretations it can be deduced that the small businessman and the small business are integrated concepts. The small businessman is the person who discovers, initiates, accepts risk and responsibility, supplies capital and is involved directly in the management and operation of the business. He is also the person who receives the dividends. A small business is an independent, continuous economically viable organisation that has as its objective, the profitable accountability of the capital, effort and risk involved and attached to it. But a small business is also an extension of the person of the small entrepreneur. The concepts: small business and small businessman, should therefore not be separated, but treated as one entity. From the various definitions and interpretations of a small business, it becomes clear that any definition of a small business has to consider certain economic as well as statistic aspects. The economic aspects bear relation to the qualities and abilities of the small businessman and the role he fulfils in the business. That implies that a small business will be owned, managed and operated independently and that it will not exert any substantial influence on the market. The statistical part of a definition of a small business is based on quantifiable elements such as total number of employees, annual sales or gross income, number of operating units or branches, capital, asset worth, nett profit and the number of share holders. From this, a definition of a small business for South Africa can be formulated as follows: A business can be considered as small, if the business is independently owned; independently managed; has an annual turnover of not more than R1 million; is not formed by more than 5 operating units or branches; has a total asset value of not more than R½ million; and does not employ more that 100 persons. To provide for extreme and unforeseen circumstances, a business should comply with only 5 of these requirements to be considered small. This definition can be revised from time to time to keep track of economic evolution. It is shown in Chapter 3 that the small business with its individuality, independent behaviour, private initiative, adaptability, capacity to specialise and to render a personal service to the consumer, still fonns an integral part of the free enterprise system. Certain qualitative arguments in support of small business show that small business is a manifestation of capitalism without which capitalism is unlikely to survive. The extent of small business in the economy is bigger than is generally belie~ed. Small businesses, in all countries of the Western world, form the majority of firms in number; they provide for employment for millions of people and contribute extensively to the gross incomes of Western economies. The absence of relevant statistical data does, however, prevent the emergence of a clear picture of the numerical status of small business in the world economy. Recent trends reveal a growth in the number of small finns, but a decline in market share. More research in the field of statistics and trends will be necessary to establish the absolute status and trends of small business in the economy. One of the reasons why small business does not always enjoy the attention and recognition needed in the economy, is that in many countries of the world, no specific government policy towards small business is to be found. This is to a large extent also the case in South Africa. Government policy towards small business in South Africa should, inter alia, incorporate specific measures such as: The integration of the interests of small business in general economic policy, especially monetary and fiscal policy, in order not to exert unequal pressures on the small business sector; laws and regulations to prevent monopolies and unfair trade practices and to keep the rules of competition such that small business will not be at a disadvantage because of its smallness; the prov1s1on of comprehensive training-, information-, researchand consultancy services to support small business on a national basis; collation of statistics and information on the small business sector for meaningful interpretation; development of suitable financial assistance progralTllles for small businesses where necessary; and provision for representation for small business on government 1 eve 1 . In studying the characteristics, motivation and general attributes of the small businessman, a few interesting facts regarding small businessmen in general, can be deduced. This can be summarised as follows: a The small businessman places a high premium on his independence and his status as a self-employed owner of his business. The reason for self-employment and ownership is to be found in selfactualisation. b The motive for long term profitability, although important, is not an overriding factor for the small businessman to own and manage his own business. c The objectives of the small business are closely related to those of the small businessman. The objectives may change with the status and personal circumstances of the small businessman. This may lead to an eventual fading of pure economic principles in the business. 464 d Educational qualifications may be regarded as important supporting factors in managing a small business. They are, however, not a prerogative for success and bear little relation to the motivation of an entrepreneur to operate his own business. e There is a substantial difference in approach to management and in personal involvement, between the small business owner/ manager and the professional manager of a large organisation. These and other characteristics of small entrepreneurs must be borne in mind whenever the small businessman is studied; considered or evaluated. Small business is confronted with numerous problems, some of which stem from external sources such as the general economic conditions, political climate, demographic ~hanges, consumer behaviour, etcetera. The small businessmen have very little influence on these problems. The majority of problems of small businesses however, are internal problems, and stem from internal managerial, organizational and administrative weaknesses within the firm. According to an analysis of the problems of 239 small businesses, consulted by the Small Business Advisory Bureau, the main internal problems of small business are related to managerial incompetence. Any assistance progranvne to small business should, therefore, be aimed at the improvement of small business management. Various assistance programmes as offered by assistance agencies in many parts of the world, are explained and discussed in Chapter 5 of this study. Chapter 6 looks specifically at consultation services as a method of assisting small businesses. Consultation services imply an organised, progranmed, systematised service, offered on a national basis and with the prime objective of serving the interests of the small business sector by providing individual consultations. Such a service should be ~ubsidised by government, organised commerce and industry, and by the private sector. 465 It stands to reason that a small business consu1tancy service will require consultants of a special nature and background. Small business consultants will have to act as change agents, analysts, advisors, educationalists and innovators. Their knowledge and practical application will have to encompass a wide spectrum and will include most aspects with regard to small business. Consultants who do not possess the required knowledge and experience will have to be trained through fonnal education, selfstudy and in-service training. - The methodology of consulting small businesses is in accordance with the objectives of the service as a whole, but considers also the characteristics of the small businessman, the time at his disposal, infonnation available and the local conditions under which the small business operates. Several aids are available to assist the consultant in his task. Assistance agencies offer a wide range of consulting services such as general indepth investigations, specific consultations, assisting and and follow-up consultations and as well as advice by telephone or letter, to name but a few. Various factors detennine the preference for a particular type of consulting service and the extent of the consultant's involvement in the small business consulted. Finally, the results of consultation services are evaluated. General guidelines for the evaluation of consultation services are discussed and then followed by an evaluation of the results of the general consultations carried out by the Small Business Advisory Bureau during the financial year of 1976/77. From the opinion survey of the consulted small entrepreneurs it can be deduced that the majority of small businessmen experienced benefits that derived from the consultation. The consultation proved to have been instrumental in effecting changes in the business, it increased the managerial competence of the owner/manager and led to favourable financial results. 466 The latter deduction was followed up by an analysis of the financial statements of a group of consulted small businesses. This analyses revealed increased rentability, a bettennent of the financial structure and higher productivity after the consultation. It also showed an increase in the income tax payable by the group of consulted small businesses. The study is concluded with a few reconmendations which should be followed up in South Africa. a) Research in the field of small business, its definition, its place in the economy, and problems confronting small businesses should be followed up. b) Attention should be given to collect relevant data concerning the small business sector in its various components and facets. c) A concise and clear government policy towards small business should be fonnulated. Small business should receive more attention from government, academics, organised conmerce and industry, and the private sector. d) More research is necessary into the motivational aspects of small entrepreneurs of all population groups. e) Specific attention should be given to the cultivating of entrepreneurs as an important input to the economy. f) Educational institutions should give more priority to small business management and the training of small business owners/ managers. g) Consultation services as described in this study should be offered on a much wider and more comprehensive scale to all small businesses in all sectors of the economy and to small businessmen of all population groups.