SIXTEEN years after SA's first democratic elections the country's more than 2-million small businesses are still without a credible voice to lobby the government and the private sector on the problems they face when starting or expanding a business.
These problems include access to finance, a lack of proper business support, stifling red tape and labour laws, market access and anticompetitive practices from large firms, late payments from the government and crime. Yet despite this, business chambers and associations appear to be doing little to lobby the government on behalf of their members.
Large chambers such as the Port Elizabeth Regional Chamber of Commerce and Industry (Percci), the Durban Chamber of Commerce and Industry and the Johannesburg Chamber of Commerce and Industry (JCCI), representing more than 5000 small firms collectively, all have training and mentoring programmes for small businesses but most have done little else on their behalf.
Zandile Komanisi, Percci's SMME task team co-ordinator, and Thabsile Ntuli, the Durban chamber's SMME co- ordinator, both could not name a single instance where their respective chambers had recently lobbied the government or corporations on behalf of their small-business members.
Keith Brebnor, chief executive of JCCI, could similarly not pinpoint specific recommendations his chamber has made to Business Unity SA (Busa).
Even privately run associations such as the National Small Business Chamber has yet to approach the government on the needs of small businesses. Mike Anderson, the associaton's chief executive, said the nonprofit organisation, launched in 2008, has more than 2500 members and aimed to have more than 200000 members within the next two years.
Anderson has teamed up with sponsors who provide advice and assistance on legal issues and tax as well as insurance.
The chamber's constitution states that one of its objectives is to act as a voice for the small business community.
However, Anderson said that the association had not yet begun lobbying the government and big business, though it intended doing so soon. So far it had drawn up a prompt-payment code urging big businesses to commit to paying small businesses on time.
He said most corporations paid about 120 days after the submission of an invoice.
The chamber would also be lobbying for corporations to cut down the length of their vendor applications, as these could often run to 60 pages or more.
The South African Black Entrepreneurs Forum (Sabef), another private initiative, has also done little to voice the concerns of small business.
Sabef president Lebo Gugulisa said the forum is part of the Confederation of Black Business Organisations and sits on Busa. The forum has hosted several seminars and networking events and assisted members with compliance documents, such as BEE certificates, VAT registrations and tax clearance.
Gugulisa claimed the forum had helped some business owners to resolve late payments from the government.
The forum claims to represent 30,000 entrepreneurs, but Gugulisa conceded that only 1,000 of these are paid-up members.
However, Albert Schuitmaker, executive director of the Cape Regional Chamber of Commerce, said his chamber had recently lobbied successfully on behalf of small businesses.
He said the chamber had been able to get banks to relax some of their lending criteria for start-up businesses after a meeting held with the Banking Association last year.
Schuitmaker said since the meeting the chamber had noticed that at least two banks - Absa and Standard Bank - had come out with more friendly packages for small businesses. These included a reduction in the amount of collateral that banks had put in place after the National Credit Act came into effect three years ago.
"It's often perceived that chambers represent big business, but this is not true. We mainly look after small and medium-sized businesses," said Schuitmaker.
He said that between 60% and 70% of its 3100 members were firms with fewer than 30 employees.
The Foundation for African Business and Consumer Services (Fabcos) said it has been successful in getting the government's small business finance agency, Khula, to set up a small business equity growth fund in May.
Fabcos, which has 2000 members - most of them businesses with an annual turnover of about R100,000 a year - is the implementing agent and the fund is aimed at members.
Fabcos chief executive Alan Campbell said this followed a seminar on the problem of access to finance in June last year. The fund provides loans of between R10,000 and R3m.
Campbell said Fabcos held three other seminars last year on the effect of rising fuel prices, procurement bottlenecks and small and big business linkages, which were attended by representatives from the government and development finance institutions.
At Busa, moves are afoot to seek a more permanent voice for small business, and one of the organisation's members - the Association of Accredited Chambers of Commerce and Industry which represents JCCI and the Cape Regional Chamber of Commerce - has been tasked with tackling small business issues.
Small business accounts for 35% of the country's gross domestic product, yet despite this there is no permanent office or representative at Busa that covers small business.
Costa Pierides, Busa's executive for chambers and membership, said that the area of small business fell under the organisation's transformation committee, which made use of Thami Mazwai, the director of the Centre for Small Business Development at the University of Johannesburg, to advise it occasionally on small-business issues.
Though Pieredes said Busa had always had a strong focus on small enterprises, he admitted that the voice of small business was being drowned out because of a lack of cohesion among the various business associations that make up Busa.
He said Busa's challenge was that the various chambers had their own involvement in small business, which the umbrella chamber didn't want to mimic. Another problem Busa faced was trying to establish the credibility of the various business associations that claim to represent small business, youth and women enterprises.
Small-business researcher Septi Bukula, from Upstarts Business Strategies, said business associations and chambers had failed to voice the concerns of small business because they were not conducting enough research.
Bukula said a key difference between South African business associations and those in other countries was that home chambers and associations were not engaged in research on small business.
"The fact that they are so weak on research means they have no scientific basis for advocacy."
He said for example in the UK their Federation of Small Business had compiled a detailed analysis of each political party's position on small business before the recent election.
The federation also compiled a policy paper on what it believed the government should be doing to support small enterprises.
Similarly, the US's National Commission on Entrepreneurship had presented candidates running for the 2008 presidential election with a guide to entrepreneurship.
"This country is focused on big business. The voice of small business is tucked away," said Bukula.
He said that ironically the lack of a small business voice had led the Department of Trade and Industry to set up the National Small Business Advisory Council chaired by the Minister of Trade and Industry Rob Davies. Schuitmaker said that his chamber relied on member surveys rather than research.
"We would love to have more research capacity, but we use our members extensively; we then try to get members involved through workshops, then formulate our position."
Campbell said Fabcos had an in- house researcher but had teamed up with the Gordon Institute of Businesss Science to expand its research capacity, while also looking for additional funding to pursue more research.
Nafcoc president Lawrence Mavundla failed to reply to numerous requests for comment on what Nafcoc is doing to lobby on issues affecting their small- business members.
This article appeared in Business Day on 20 July 2010: http://www.bdlive.co.za/articles/2010/07/20/voices-of-small-business-still-mute;jsessionid=424B9F06EAB1D7AF20803E378A3F869F.present1.bdfm
Stephen Timm is a