Youth-owned township businesses complain of market access barriers
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Bulelani Balabala, 31, founder of the 12000 member Township Entrepreneurs Alliance called on the government for a strategic plan for township-based entrepreneurs “across the country” to help them “unlock the doors that we need to unlock”.
Balabala presented his insights on youth entrepreneurship development at a panel discussion themed “Entrepreneurship in the Township Economy” at Wits Business School, in Johannesburg. He said township entrepreneurs were faced with three main challenges: access to markets, sales and marketing support, and funding.
“Funding is not number one anymore. Get your customers to put a rand down, you’ve got a business, because that’s also market access.”
An entrepreneur from Tembisa, east of Johannesburg, where he’s been operating his business for 15 years, Balabala said: “We want to build hubs of economic development in every township in the country. The chambers (of commerce) that were there at the time, have failed us. I don’t even know what Nafcoc (National African Federated Chamber of Commerce and Industry) does.”
Balabala’s concerns on the state of youth entrepreneurship in the townships was shared by the 90-odd young South Africans who filled Donald Gordon Auditorium.
Sibusiso Mavundla, treasurer-general of the youth chamber of Nafcoc, the oldest black business umbrella body, chided the government for not supporting businesses owned by young people.
“There are institutions that are supposed to be supporting young people. But the NYDA (National Youth Development Agency) now gives non-financial support, which disadvantages young people. We are not happy with any of the institutions. Young people are not getting support from these institutions,” Mavundla said.
“Big business doesn’t care what happens to small businesses and to young people in the country. They are there to make a profit. Have legislation that would compel big business to procure from young people,” he said.
“Nafcoc Youth believes that the only way we can eradicate unemployment in this country is through supporting small and medium enterprises that are owned by young people.”
Mavundla said if youth-owned businesses grew, they would “hire other young people” and reduce the high unemployment rate among youth.
Maryana Iskander, chief executive of Harambee Youth Employment Accelerator, a non-profit social enterprise established in 2011 with a network of 500000 work seekers, believes her organisation has tangible solutions to the conundrum. It has enabled 100000 young people to access work opportunities in partnership with 500 businesses.
“Harambee tackles the youth unemployment challenge using data, innovation, partnerships and on-the-ground experience to build pragmatic, implementable solutions that work.”
Iskander said Harambee could help youth “reduce the costs of looking for a job”, when they register at Harambee.mobi.
“As part of the Jobs Summit agreement, big business, government, labour and social partners adopted Harambee’s Pathway Manager as a concrete solution for connecting young people to economic opportunities in corporates, small businesses, township enterprises and self-employment.”
Pearl Maphumulo, managing director at The Business Development Agency, which helps develop small and medium-sized enterprises in Africa, said the greatest problem faced by youth-owned businesses was “access to markets” and “lack of visibility”.
NYDA spokesperson Lerato Gambu said youth singled out “lack of access to funding” as their greatest problem and that the NYDA provides R1000 to R250000 in funding assistance to youth-owned businesses.
“Our Entrepreneurship Development Programme has market linkages that ensure young business people are linked to the right markets.”
Gambu said the agency had “lobbied government to declare experience for entry level jobs” in the public service “a non-issue and government has acceded”.
“We need to employ more young people.”