Press Release: SACCI and CIPC initiative to reduce SME failure rate
FOR IMMEDIATE RELEASE - 6 November 2024
SACCI AND CIPC INITIATIVE TO REDUCE SME FAILURE RATE
The CIPC is responsible for new company registrations in South Africa and registers 50 000 companies per month. But according to research 70% will likely fail within 2 years.
Stepping up to save SMEs and increase GDP
Realising this sorry state of affairs and being deeply committed to improving the business environment in South Africa SACCI partnered CIPC and important stakeholders like the Chartered Institute for Business Accountants and UNISA’s affiliate company, Inhlanyelo Hub.
Our aim is to lower the failure rate with 6% then we can save 3000 companies per month. If each of these companies employ 2 people we will create 6000 jobs per month, 72 000 per year and 720 000 in 10 years.
The Need for SME Launch
Starting a business is no easy task, and for the 600,000 new companies registered annually in South Africa, challenges like cash flow management, regulatory compliance, and limited market access can become overwhelming. Nearly 70% of these businesses may close within their first two years. SME Launch directly addresses these barriers, creating a stable foundation for SMEs to grow, create jobs, and strengthen South Africa’s economy.
A Unified Effort to “Adopt” and Support SMEs
By combining the expertise of each partner, SME Launch creates a comprehensive support structure that follows SMEs through every stage of their journey:
CIPC (Companies Intellectual Properties Commission) registers new companies and ensure companies are well governed, transparent and accountable.
SACCI (South African Chamber of Commerce and Industry) South Africa's national business chamber, connects SMEs with 20,000 businesses, reduces government red tape, and amplifies the SME voice with key decision-makers, offering access to events and global business opportunities.
CIBA (Chartered Institute for Business Accountants) is a statutorily recognised professional body for accountants and supports SMEs by delivering competent accountants and providing free accounting and tax training to SMEs helping them run their business better.
UNISA’s Inhlanyelo Hub delivers tailored business development support, helping businesses turn initial ideas into sustainable, growing companies.
The Potential Impact: Building a Stronger Economy
SME Launch’s collaborative approach has the potential to create lasting economic benefits:
Job Creation: A reduction of 6% in SME failure rates could mean an additional 3,000 businesses remaining open each month, potentially creating 6,000 new jobs monthly and 72 000 per year.
GDP Growth: Supporting more businesses to thrive contributes to South Africa’s GDP, building a resilient economy.
Join the “Adopt an SME” Movement
SME Launch will kick off with a free webinar on 12 November 2024, introducing SMEs to the resources and programs available. Register today to be part of this initiative at www.smelaunch.co.za.
Quotes from the SME Launch partners
“SME Launch is our way of ‘adopting’ South Africa’s new businesses, helping them grow into sustainable, thriving contributors to the economy,” said Adv Mtho Xulu President of SACCI. “This partnership ensures new businesses have the guidance they need to succeed, creating long-term value for both SMEs and the nation.”
“CIPC’s mission goes beyond registering companies; we’re committed to helping them thrive. With SME Launch, we’re creating a supportive foundation for new businesses, ensuring they start with the tools and guidance they need to succeed and stay compliant” said Adv. Rory Voller, Commissioner, CIPC. This initiative aligns with our commitment to building a stronger, more resilient SME sector that can drive job creation and economic growth in South Africa.”
“Inhlanyelo Hub is excited to be part of SME Launch, where we can turn entrepreneurs’ ideas into sustainable business realities.” said Professor Raphael Mpofu, CEO, Inhlanyelo Hub. Our tailored mentorship and development programs are focused on nurturing these businesses from their earliest stages, so they’re ready to grow, contribute to GDP, and become long-term job creators in South Africa.”
“At CIBA, we see accountants as vital partners in the success of SMEs. Through SME Launch, our goal is to equip new businesses with essential financial skills and connect them with competent, trained accountants who can guide them through challenges and support their growth. said Nicolaas van Wyk, CEO, CIBA. By supporting SMEs with solid financial practices, we’re strengthening not only these businesses but the broader economy.”
Media Contact:
SACCI, info@sacci.org.za, 011 446 3800.
For interviews with the partners to SME Launch send an email request to svantonder@myciba.org or phone 0797761804