South African economy in need of a make-over

Businesses can prepare themselves for a drab outlook if the Rand’s value falls even further. Unfortunately, unless South Africa commits to a major restructuring of our economy, there is no way to avoid this fate.

”[South Africa’s] trade and government’s budget and current account deficits levels were worrying and if this was not corrected, the country’s currency would take a further knock as Western economies reached the end of their hard times,” US financial expert,  John Mauldin, warned at a recent seminar hosted by Sanlam.

South Africa no longer leading the pack

Mauldin’s comments came just after Nigeria surpassed South Africa as the largest economy on the African continent. Although he feels a drastic restructuring of trade dynamics and financial relationships with the rest of Africa is necessary for our economic survival, Mauldin stresses that the necessary changes have to start at home.

We have to find a way to bring our trade deficit under control, basically pointing at a need to up our exports, and limit imports. November 2013 showed the first trade surplus in South Africa in almost two years, but the good news soon faded when January showed a backwards slip and a deficit of R16.93 billion.

 Every drop in the bucket helps

Mauldin warned South Africans not to sit back and blame our political situation for our lack of trade relations in Africa, or for missing the boat when China started investing in neighbouring economies these past five years. “You can always start from where you are,” he urged, and what better time than the present?

Supporting local business initiatives instead of importing products and services wherever possible can only help reduce our ever-looming trade deficit. In the opposite direction, producing for export and cementing relationships with international trade partners is just as crucial.

It has never been more crucial for small and medium businesses in South Africa to up production of exportable goods. This being said, investing in the education and expertise necessary to bring our business sector up to snuff is a great place to start. Business management training and research into the optimisation of import-export opportunities is the first basic step for any successful trade partner.

In order to give our economy the make-over it needs, South African businesses are compelled to play at a new level of economic ambition.

 

 

How is your job affecting your happiness?

On the 20th of March 2014, the world celebrated the second United Nations International Day of Happiness.  Jetpac City Guides, a developer of guide apps for tech-savvy travellers, celebrated the occasion by measuring the happiness of cities around the globe based on the size of smiles on Instagram uploads.

An image processor measured the smile pixels on faces from across the world to calculate a smile-score for every city in every country. Based on smile measurement, Brazil is the happiest country with a score of 60.8. South Africa also did well. We grinned ourselves into 18th place with a score of 33.6.

The influence work has on happiness

Studies have shown a happy worker is more productive, but can your job influence your general happiness? Let’s have a look at the overall happiness of South African workers to see if our impressive smile score has anything to do with our careers.

In a survey done by the iOpener Institute for People and Performance in 2012, South African workers showed an above average rate of ‘worker happiness’. The survey took into account five factors influencing professional contentment: Contribution - the effort an individual or team makes; conviction - short-term motivation; culture - a feeling of fitting in at work at work; commitment - long-term engagement; and confidence - the belief in one’s ability.

Participating South African workers scored above average in all five components despite a troublesome economy and a dauntingly high unemployment rate. According to Katie Demain of Stroke, the South African representative of the iOpener Institute, “…Those who are in formal employment in S.A. have a sense of being privileged and more readily take personal responsibility for their own success.”

The happiest jobs to have

According to Forbes, the five happiest jobs in the USA are database administrator, quality assurance engineer, executive recruiter, insurance underwriter and executive assistant. The average annual income for workers in these positions in America is about US$78 700.

Forbes recently published another study comparing worker happiness with income and found a direct correlation. Their findings looked at diverse factors influencing happiness over different employee levels, but found a definite tread of greater career enjoyment in the higher ranks, which also happen to enjoy larger salaries.

Since the job market here at home looks different than in the US and our salaries might not always be completely on par, it is difficult to say whether executive recruiting or underwriting car insurance in South Africa is the key to a happy career. What can be said however, according to Katie Demain, is that, “South Africans have a ‘can do’ attitude, and combine this with ‘job-crafting’, which is about making their positions suit their preferences instead of resigning from that position. Their work ethic is well known globally and, as a nationality, South Africans are a resilient collective of people who manage organisational change and people dynamics at work quite well.”

Perhaps our admirable happiness has more to do with our brilliant work ethic than where we work.

 

 

 

 

 

On mobile and other non-static marketing

Advertisements are traditionally located in one kind of space: When you open a magazine and see a full page spread for a product; when you are forced to look at the giant eyeballs of some model unnecessarily caressing the marketed item. All these and others would be considered advertising, but that does not move from its current space. There is also advertising that is almost the opposite and is, essentially, performed in some sense, because it appears in different places to different people – such as aerial advertising and vehicle wraps.

However, the line is not so clearly defined.

Graphics and pages

A full page, or several, of advertising taken out in a newspaper is an obvious and traditional medium and method to market your product or services. Age, however, has never stopped creative individuals from utilising a medium to gain maximum benefit. For example, several marketers were incredibly smart and creative in using double-page spreads.

It was recognised that people’s action is to open up the middle; considering that people would perform this action, creatives could put in whatever they wanted. Everything from pop-up tables, to market furniture, to sliced sea creatures, to market sharp knives. This is a memorable use of an otherwise boring platform.

Yet, this assumes people will read physical pages. These days more and more people are using the internet or tablet devices. Utilising this, short video advertisements are used – with sound, graphics and so on. Would these constitute frozen, specifically placed ad?

The answer isn’t that simple.

Mobile marketing and internet media

Company cars are usually designated by having a wrap-around and/or large letters, numbers, and the company logo. There is some advantage of course to advertising in this way: usually employees get significantly lower deposits, if they have to pay at all; the company receives wide coverage; there are usually some tax benefits if you consider the rules applied correctly.

Your logo is not just in one area: so those in a richer area might not see your company, until your employee or yourself drive through.

But is this so different to advertising on a website? Not obviously: the same person who lives in a richer neighbourhood might use the same site as those from a not so rich neighbourhood. Nothing is restricting them.

Similarly, how would one classify a banner attached to a plane? Many people can see it, but it has no graphics or sound. This means it is not so obviously static just because you make it once – just as with, say, a short video ad that appears on a website; that’s made once but can be seen everywhere

Blurring the lines between frozen and mobile, advertising these days doesn’t so neatly fit into frozen and moving kinds. Duplication and internet access mean that many people will see the same ad – not just those who open or purchase fancy magazines. With this in mind, we need more innovation in this area to keep things interesting, artistic and enthralling – not just the playful areas of paper magazines.

 

 

Should you Rent or Buy Commercial Space?

Your business location is a make-or-break decision to make. Something you might want to consider as well is whether to rent or buy commercial space.

How do you know which is right for your business?

Cash – like in the case with residential property, buying commercial space generally requires a sizable deposit, perhaps 10 percent of the total amount and likely more. If you don’t have that kind of cash available, or you need to put all your available funds into keeping your business running, than it’s better to rent. Retail investment does require a lot of resources – be careful in determining whether you can afford to buy.

Future – You need to think carefully about your future needs. If you’re renting, you have flexibility to upgrade to larger premises, or to a better location. If your overheads are too high, you can seek more affordable rent elsewhere. If you’re sure that you can make use of a location for a long time to come, then you can consider renting. Even if you foresee yourself moving sometime in the future though, remember your business could earn a secondary income by leasing the premises out.

Availability – There are a lot of factors to consider when choosing your business location, such as available parking space, your cash flow, traffic routes, distance to suppliers, zoning laws and more. Where to put up shop is one of the most important decisions you can make, and not to be rushed. For this reason, if you’re not too sure whether to buy or rent, first check out the availability of property that ticks all the boxes.

It might be the case that there is property for sale in Johannesburg that is ideal for you. But on the other hand there might not be something for sale that ticks all the boxes. In that case, rather rent in the meantime until something ideal becomes available.

In general, renting is preferable for businesspeople who are starting out, uncertain of where their businesses will be in five years, or need more control over their cash flow. Or who simply don’t want to have to deal with the hassles of owning property. On the other hand, buying makes sense for businesses that are established and stable in their cash flow. Also, for businesspeople who like the idea of making a real estate investment.

There’s no rush. Take the time to assess your options so you can make the best decision for your business.

 

Finding a middle ground between outlet and online shopping

We have all heard economists singing the praises of e-commerce, stating that soon all our consumerist needs will be met by online opportunities for purchasing products and services. Where does this evolution in lifestyle leave the brick and mortar outlet? Some would say the shop is becoming obsolete, but there is still a place for both sides of the shopping-coin.

Keeping true to brand identity on- and off-line

Consider the joy of walking into your favourite fashion outlet, hobby store or home décor supplier. Even before finding appeal in what the store has to offer, shoppers are confronted by the ambiance. These experiences are especially true of luxury brands where the storefront echoes the brand’s sophistication.

Although the physical experience of visiting such an outlet is location orientated, a similar “look and feel” can be achieved with a well-designed e-commerce site. A well-managed outlet will take special care to engage the senses of visitors with pleasant décor, music and inviting visuals. To carry a brand identity over into an online platform, equal attention must be paid to ensure the website echoes the sophistication and styling of the outlet.

A challenge in the world of online shopping is overcoming the absence of a client physically engaging in the merchandise. In the fashion industry, a shopper must decide whether they like a product’s appearance and price, as well as how it fits their body. Some web-based fashion suppliers have overcome this obstacle by allowing consumers to try clothing on in the comfort of their own home, and with their own existing wardrobe at hand, before committing to a purchase.

The human relationship

In our hyper digitalised world we often forget about the value of real human connection. A lot of client confidence lies in the ability to speak to an actual person who is knowledgeable about their product and approachable when it comes to negotiations.

Although online shopping provides convenience in other areas, consumers do value a personal relationship with a consultant or shop assistant when considering large purchases. Once a face-to-face sale has been made, future online sales through the same employee might be an avenue customers feel more comfortable exploring.

In the case of a purely online store, human interaction can still be achieved through personalised, friendly emails and phone calls wherein a particular employee ensures the happiness of a set portfolio of clients.

The critical balance

Some types of commerce are unavoidably dependent on offering a client the ability to try a product – for instance, a dealer of pre-owned cars must offer the option to test drive vehicles.  Even here the successful marriage between a brick-and-mortal dealership and online shopping is still the best way to ensure a convenient shopping experience. A client can browse vehicle models and options within their budget at leisure before visiting the showroom to narrow down their choices, effectively saving time for themselves and the dealership.

In the case of a business reliant on closing the deal at a physical location, it is tempting to see the online aspect as secondary to the outlet. With the world becoming more and more digitalised, shop owners can no longer deny the value of online shopping. It is important to realise the significance of both sales platforms and use them in conjunction with one another to achieve the perfect shopping experience