SME's - major external reason for failure
SME's - major external reason for failure
In South Africa, the one external reason that contributes to most SME business failures is non payment by clients.
Corporate South Africa and government are the two worst offenders!! If you have budgeted the funds, you have the funds available, then why not pay on a 30 day basis at worst, or COD at best.
The government spends billions on development capital to create new businesses, then promptly destroys thousands of businesses through non or very slow payment.
Corporates complain that doing business with SME's is so difficult because they just cannot get their act together. Well how can you when you customers never pay you on time. No business can function without working capital, and for SME's it is often sitting in their customers' bank accounts.
The result is a knock on effect as the SME paid late is also the SME who pays late. This culture in South African business is not very conducive to building businesses.
Rob Smorfitt
SMEs major external reason for failure - To learn more about this author, visit Dr. Rob Smorfitt's Website.
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SME's - major external reason for failure
In South Africa, the one external reason that contributes to most SME business failures is non payment by clients.
Corporate South Africa and government are the two worst offenders!! If you have budgeted the funds, you have the funds available, then why not pay on a 30 day basis at worst, or COD at best.
The government spends billions on development capital to create new businesses, then promptly destroys thousands of businesses through non or very slow payment.
Corporates complain that doing business with SME's is so difficult because they just cannot get their act together. Well how can you when you customers never pay you on time. No business can function without working capital, and for SME's it is often sitting in their customers' bank accounts.
The result is a knock on effect as the SME paid late is also the SME who pays late. This culture in South African business is not very conducive to building businesses.
Rob Smorfitt
SMEs major external reason for failure - To learn more about this author, visit Dr. Rob Smorfitt's Website.
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