02 May 2019

The failure rate for small businesses in Botswana is estimated at 80 per cent with lack of capital being the major challenge facing the businesses, says South African business consultant, Ms Indigene Harris.

She said a clear business plan was key in attracting potential financiers or investors, adding that a business plan was an important document in getting business owners to clarify their business to themselves before it becomes an asset to share with stakeholders.

“As an entrepreneur it is important to have a business plan, no matter what sector you are in, no matter how big or small your business is. Potential investors or lenders want a written convincing business plan before they give you money,” she said.

Ms Harris made the remarks during an interaction session with young people who shared that they had good business ideas but business plan was a major challenge for them to access finances and kick start their projects.

A business plan, she said was a communication tool that one could use to secure investment capital from financial institutions or lenders, noting that it could also be used to convince people to work for one’s enterprise to secure credit from suppliers and attract potential customers.

Although, she differed with them that a business plan was a challenge stating that business plan was easier to write once one has a clear concept.

She added that a mere description of business concept was not enough, instead, they should also ensure they have a financial plan that demonstrates the likelihood of success and how much they would need for their business to take off.

The financial plan, she said had to demonstrate that the business would grow and be profitable.

She mentioned that having a business plan helped one to define and focus on their business ideas and business strategies and not only concentrate on financial matters, but also on management issues, human resource planning, technology and creating value for their customer.

Ms Harris stated that small businesses have the ability to create employment and stimulate the economy of Botswana and advised young people to take advantage of available opportunities offered by the government to fight high rate of unemployment.

“A lot of young people have excellent business ideas but they lack confidence and have a fear to execute their ideas, she added.

She said Batswana youth were very lucky to have programmes and organisations available to provide financial assistance such as Citizen Entrepreneurship Development Agency (CEDA), Kgalagadi Brewery Limited – Kickstart, Youth in Business Botswana, foreign embassies based in Botswana and Youth Development Fund among others.

She said in Botswana, SMMEs contributed 75 per cent of formal sector employment.

Another expert, Ms Kelebogile Disang from the banking sector stressed the need to write a convincing business plan, adding that no financier would  be willing to give out money to a failing business.

She said a business plan should be communicating and seriously convincing to get funding. Ms Disang noted that business owners should indicate the viability of their business in order to attract lenders.

In the banking sector, Ms Disang revealed that security was key as they wanted business owners to commit themselves that they would pay back the debt .

The interaction session was organised by Thari E Ntsho Storytellers coordinator, Ms Bontekanye Botumile, as she was concerned about high unemployment rate amongst youth.

One of Thari E Ntsho Storytellers objectives is to provide socio-economic upliftment for out of school youth and women and she believed that the session would groom participants into business owners.

In an interview, Ms Botumile said some youth were eager to start businesses but  were failing despite having practical skills, talents and good ideas.

She said the interaction would assist them as they would learn the importance of business plan and other factors that are vital in starting a business operation. ENDS