eBusiness Weekly
The economic stability Zimbabwe is now enjoying — having Covid-19 under control and the efforts of first the private sector to get wages above starvation level, and with those resulting extra taxes the Government is following suit, is it not time that we started thinking about expanding and starting businesses?
A drive or walk down say Samora Machel Avenue as it winds its way out of the city centre, or a stroll around the industrial sites, especially Graniteside or Msasa, you will find a lot of smaller and medium businesses, usually family owned, that have survived the recent economic horrors and are back to providing their owners with a modest but comfortable income.
But who are these owners? Many are skilled people who decided to work for themselves and turn a good idea into their dream.
Interestingly, the skills are largely technical, whether they have a suburban service company or an industrial manufacturing company. In fact sales skills can be said to be moderate, these businesses largely relying on word of mouth to build up their customer base.
In fact a fair number were set up by the “technical guy” in someone else’s business, who reckoned they could do better and could win by providing the services and goods others wanted without padding their payroll with glamourous receptionists, sales staff in fancy suits and spending a good chunk of their income on lifestyle, rather than on reinvestment.
Even rent, or property investment when they got larger, tended to be minimised by choosing the less fancy addresses, taking over a suburban house rather than living in an office park or building a fancy factory that would make the architectural journals.
Even their accounts are kept cheap. As they grow they might hire a bookkeeper, although some manage with a part-time person. Many, however, reach the stage where they need something better.
There are a number of similar thinking types, accountants, who run their own service companies, setting up systems for their clients, telling them how they want the books kept, and then one day a month, or even one day a quarter, drawing everything together into a form that will satisfy Zimra and the bank.
This technical and production approach can be seen in those industrial areas where the smaller concerns congregate and flourish. You ask for the managing director or the chief executive and someone in overalls turns up, as that skilled person is also their own foreman.
Many corporates, to take one example, have established relationships with an IT expert as supplier and maintainer of their systems. They have tracked down someone with the technical background, who maintains the required technical or software certifications, but might not have a fancy address or, for that matter, a fancy car. But they deliver. When your systems go down they are there, even at 1am.
Some of these smaller businesses do grow, sometimes spectacularly.
Some of us who have been around for a while can remember two bright young men, recently out of university, dreaming a dream and opening a take-away in First Street Mall in the latish 1980s.
Reinvesting every cent they could squeeze, they continued building and expanding; when the hyperinflation hit they turned cashflow into investment to weather the storm, and help out their suppliers.
The Innscor-Simbisa-Axia-Padenga empire, four companies listed on the Zimbabwe Stock Exchange with some overlapping shareholding, mainly from those two bright young men, is the result.
Again some of us remember when Econet Wireless was a dream of an young engineer who reckoned he could do a lot better than the old Posts and Telecommunications Corporation.
That company had a staff of precisely two, Strive Masiyiwa and an office assistant, in two second floor rooms in the Fidelity Life Tower in the Kopje area. Twenty seven years later, it is a pair of listed companies on the ZSE plus holdings across Africa.
If you go right back in time, to the 1890s, the two oldest two ZSE companies were tiny.
Meikles Africa was three young brothers who reckoned they could make a couple of quid by shipping in goods to “Fort Salisbury” by ox-wagon, but on arrival found that no one had enough working capital to buy their stuff in bulk, so upturned one wagon as a shop counter and started selling retail.
Admittedly they had done their homework, nurtured their imagination and figured out that the fort would be dry, so a decent chunk of their first supplies were the first bottles of whiskey seen in the area for some months. That built their working capital which was promptly reinvested.
Zimpapers, that is us, started even smaller, with just one man. William Fairbridge had been sent to the fort as a local reporter who would take stationery orders. He started a newspaper, handwritten on a cyclograph stencil, and caused a degree of apoplexy in Johannesburg when he passed on the news and asked for a printing press, “just a little one”. But he made profits, reinvested and within around half a decade was the first mayor, although still working on the wrong side of town.
One big secret if you look at those companies, is that their founders were never flashy, never haunted bars and nightclubs, did not buy fancy carriages in the early days or fancy cars in the later days. And they all knew what they were doing in their own line of business. In fact they had to teach their first employees, often starting from the basics.
They all innovated, reinvested heavily and insisted on high standards giving maximum value for the money their growing customer bases were prepared to spend.
The point of all this digression is that there is never a perfect time to start a business. Success, for a viable and lasting business, is never instant. Skills, exceptionally hard work, a desire to please customers and a willingness to reinvest every cent of profit not required for a modest lifestyle are the requirements.
And this is what has built Zimbabwe. The paper shufflers and speculators have always been there, or course, lighting up the night for a short while and then disappearing as the police close in or watching their big bubble pop. But the real wealth and the real jobs have been created by the producers, among whom we should include the service companies that keep the producers open.
The long-required foreign currency auction system, and the Government’s rewriting of company law, have now opened up new opportunities. The SME auction, in particular, appears to have been embraced by the successful technical companies who were struggling with runners and black markets but now can budget and cope.
But success, while possible and even likely, cannot be guaranteed. But for those with the right skills, the right attitudes, it is there.
And this is where those responsible for lending money for start ups also have to start. They need to look at the skills, look at the attitudes, rather than look at the suits.
There has been a tendency in Zimbabwe to place lifestyle high on a list, but that is just ego and consumerism.
Big business can help, by seeking out suppliers who have the skills and attitudes required and who place quality and value for money on the top of their lists. First the older and bigger concern will benefit with decent suppliers, and secondly they will be helping to build the Zimbabwe we all want and need.
