ALL THE TIPS YOU NEED TO KICKSTART YOUR SMALL BUSINESS

Starting a small business in a rural area? Get these five key elements right, and you’ll be halfway to success.

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Small businesses in out-of-the way areas can offer unique opportunities for building customer support and generating profit, but they also face unique challenges. Following these guidelines will help get your business off to a healthy start.

1. IDENTIFY YOUR MARKET OPPORTUNITY
By their nature, rural businesses serve the needs of their local communities. This means that in order for your business to thrive, you need to ensure that there is a viable market for the product or service you intend to provide. First, answer these questions:

• What do the people in your area need? Is there a ‘gap in the market’ for a particular product or service that no one else is providing, or is there very little competition for your business idea in the area?
• Can you provide this product or service at a rate that people in your community can afford?

A 2021 study by SME South Africa found that successful rural businesses tend to be found in sectors in which the legal requirements are few and the cost of starting up is relatively low, such as food stalls, laundry services, towing services and IT/communications assistance. However, use your local knowledge of the area to identify what product or service would bring the most benefit to your particular community.

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2. SECURE FUNDING FOR YOUR BUSINESS 

All new businesses require some start-up capital to get off the ground. Depending on your specific business idea, you might need this capital to buy stock, or to invest in the equipment necessary to get your service up and running. The good news is that, according to a recent Small Business Credit Survey, rural businesses tend to be more successful when it comes to securing initial capital than their urban counterparts, with an 80% success rate reported between 2016 and 2019.

There are many different ways of securing funding for your business, ranging from private means (loans from friends and/or family), to formal financial arrangements (such as bank loans).

The Small Business Development portal on the South African Government’s website is an excellent resource, where you will find useful tips on how to prepare your business plan, as well as links to a range of funding opportunities and small business incentives and grants.

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3. ENSURE COMPLIANCE THROUGHOUT THE PROCESS
Ensuring that your business is legally and financially compliant with the relevant regulations, right from the start, is as important as securing funding. If it is not properly registered with SARS and the Companies and Intellectual Property Commission (CIPC), your business will not have a legal standing and you will not be eligible for many forms of business funding and other financial incentives.

Go to the Small Enterprise Development Agency website (www.seda.org.za) for step-by-step instructions on how to turn your idea into a fully-fledged business, or make use of their Business Information Centre by calling 0860 103 703.



4. HARNESS THE POWER OF MOBILE TECHNOLOGIES 

Without a doubt, one of the most common challenges facing rural businesses is a relative lack of connectivity. Try to ensure that your new business has some form of reliable access to mobile internet technologies, even if this needs to be factored into your start-up costs. The extra expense will be worth it in the long run.

Not only can web-based platforms such as social media help with marketing your rural business, but offering your customers easier payment options is another way of expanding your earning opportunities. For example, affordable Yoco Go card machines (recently on special at 299.00) gives your customers an easy, convenient way to pay for goods and services without the risk of having to carry cash to your business.

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5. GROW YOUR BUSINESS
Once your business is up and running, it is crucial that you put into place good systems to ensure its continued growth and success. This includes keeping track of your finances (especially in cases where buying on credit is an option you wish to provide) and using your new platform to expand opportunities to others within your community.

The Township and Rural Entrepreneurship Programme (TREP), run by the Small Business Development department, is a programme dedicated to transforming and integrating opportunities in townships and rural areas into productive business ventures. Visit this link, click on ‘Programmes’ in the drop-down menu and then select ‘Township and Rural Entrepreneurship Programme’. At the bottom of the page is a link where you can download a brochure for more information about how to receive support with growing your small business.



USE SOCIAL MEDIA TO MARKET YOUR BUSINESS
Although it is true that rural businesses generally face less competition than urban ones, this does not mean that marketing is not important for your business. In rural areas the need for posting content to social media platforms such as Instagram and Twitter is not as great, as you will probably serve a more regular customer base of community members. However, think of clever ways to harness the power of social media to get your message to your customers in a quick, effective manner.

• Use messaging platforms to supercharge your word-of-mouth marketing. The most successful ways of advertising rural businesses are usually through personal recommendations, and with digital messaging platforms, your customers can spread the word faster and more easily.
• Create a WhatsApp group chat for your regular customers, where you can let them know directly about any specials or product announcements you wish to make.
• As mentioned, one of the key features of successful rural businesses is their ability to serve the particular needs of their community. You can use social media as an easy way to get direct feedback from your customers and find ways of tailoring your business to give them more of what they want and need.

BY DAVID FORD