PRESENTATION STRUCTURE
       1.  Policy and Strategy Perspective
       2.  Purpose of the review
       3.  Review focus and scope
       4.  Review results
       5.  Key recommendations
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                               Policy Perspective
       •                        Policy Perspective
           After the political transformation of 1994, government adopted the White Paper 
           on the National Strategy for the Development and Promotion of Small Business 
           in South Africa (1995)
       •   The National Small Business Act, 102 of 1996 enacted to provide for the 
           establishment of support institutions-then Ntsika, National Small Business 
           Advisory Council, with Khula Established through the provisions of the 
           Companies Act
       •   In 1999 A mid Term Evaluation of the Strategy undertaken to review progress 
           made on the implementation
       •   In 2004, the Department of Trade and Industry led a Ten Year Review on the 
           status of small enterprise support in South Africa. 
       •   This led to the rationalization of the support institutions through the 
           amendment of the NSBA to form Seda
       •   Based on the 2004 review, cabinet approved the Integrated Strategy on the 
           Promotion of Entrepreneurship and Small enterprises
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                        Policy Perspective-Cont.
       •                 Policy Perspective-Cont.
           The Integrated Small Enterprise Development Strategy presents the way forward 
           for small-enterprise development in South Africa over ten years (i.e. 2005 to 
           2014).
       •   Yearly reviews of the state of small business in South Africa will provide us 
           timely feedback while the five-yearly impact reviews will reveal what progress we 
           are making over time and what adjustments are necessary (Minister’s foreword).
       •   In 2011 the dti commissioned a review of the strategy to identify weaknesses the 
           upshot of which is the fact that South African SMMEs are also less than 
           dynamic, with a majority of enterprises remaining in the nascent and 'infant 
           business' phases (less than 3.5 years in existence.
       •   With review concluded, the remaining challenge is how do we coherently 
           implement the findings in order to realise a “step change” in enterprise 
           development and support.
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                                     SMALL BUSINESS SEGMENTATION AND 
                                             DIFFERENTIATION ON NEEDS
   Driver        Category         Non-financial      Nature of           Financial          Characteristics             No. of 
                                  support            Demand noted        Support                                        enterpr
                                  services                               Sources                                        ises
                                                     •                   •                  •
                 Medium           Regulatory          Medium – long       Corporate           Up to 200 employees       Aprox. 
                                  compliance,        term debt &         •                  •
   Opportunit                                                             Banks,              Turn over >R25m per       300K
   y driven,                      incubation-        equity finance      financial          annum 
                                  quality control    •
   Entreprene                                          over R250K        institutions       •Developed technical & 
   urial                          and productivity   •                   •
                                  and franchising     Asset base,         Private equity/   business skills 
                                  and market         working capital,    venture 
                                  intelligence.      property finance,   capitalist
                                                     etc.                •
                                                                          Sefa, IDC, NEF, 
                                                                         other DFI's
                                                     •                   •                  •
                 Small            Technical           Short – medium      Own resources        up to 50 employees       Aprox. 
                                  diagnostic,        term debt           •                  •
                                                                          Banks &              turn over < R25m per     500K
                                  business mgt       •
                                                      Asset base &       corporate          annum
                                  training/incubat   working capital     •                  •
                                  ion, mentorship                         Sefa &               developed technical/ 
   Necessity                                         finance             provincial DFI's   limited bus. skills 
                                  and access 2       •
   driven,                        markets              up to R80K
   survival  
                                                     •                   •
                 Micro            Business start      Short tern loans    Own & family      Up to 5 employees           Aprox.1.
                                  advice,            •                   resources          •                           5 m
   N.B.                                               Up to R 10K                             Turn over < R 150K per 
                                  information,                           •
                                                     •                    Micro lenders     annum
   Estimates                      registration, &     Working capital 
   shows that                                        finance             & banks            • Some technical and 
   the are                        business                                provincial DFI’s  very limited bus. skills 
   approx. 4m                     planning   
   unregistere                     
   d informal 
   micros                                            •                   •                  •
                 Survivalist      Business start      Short term          Own and family       Individual self          Approx 
                                  advice and         loans               resources          employment                  3m
                                  information        •                   •                  •
                                                      Up to R3k           Micro lenders        turn over < R50K per 
                                                                                                                    5
                                                     •                                      annum
                                                      Stock purchase 
                                                     finance                                • Limited bus. & 
                                                                                            technical skills 
                                Strategic Actions 
        Strategic Pillar 1:                       Strategic Pillar 2:                      Strategic Pillar 3: 
        Increase supply                        Creating demand                        Reduce small 
        for financial and                      for small enterprise                   enterprise  regulatory 
        non-financial                          products and                           constraints 
        support  services                      services
    Collaborative approaches;               New Policy Directives;                  Establish a regulatory impact 
                                            •
                                             Public sector procurement 
    Streamline  resources from the           strategy as a lever for  increased     assessment framework and 
    public sector and crowd-in private       demand                                 Business Environment monitoring 
                                            •
    sector resources                          BBBEE codes of good practice          mechanism
                                            as a lever  for increased demand