Financial literacy is crucial for successful business management, especially for Small, Medium, and Micro Enterprises (SMMEs). In support of this, the Greater Kokstad Municipality’s (GKM) Local Economic Development Unit, partnered with the KwaZulu-Natal Department of Economic Development, Tourism and Environmental Affairs (EDTEA), the Small Enterprise Development Agency (Seda) and First National Bank (FNB), to organize a two-day workshop at the Kokstad Town Hall recently. This workshop aimed to provide Greater Kokstad SMMEs with essential skills in financial literacy and money management.

One of the key topics covered in the workshop was ‘understanding money’. This topic aimed to help participants grasp basic concepts of money, its value, and its role in business operations. Understanding the flow of money in and out of their businesses was affirmed as an enabler for SMMEs to make informed decisions that improve their financial health and sustainability.

Saving money is a critical practice for any business, especially for SMMEs that often operate on tight budgets, the attendees were informed. The workshop emphasized the importance of saving money as a means to build a financial cushion which in turn could help businesses manage unexpected expenses and provide seeds to invest in growth opportunities without relying heavily on external funding.

While credit can be a valuable tool for business growth, the attendees were told, it must be managed carefully. The workshop provided insights into ‘managing credit’, including how to use it responsibly, the impact of credit on business credit scores, and strategies to avoid excessive debt. Proper credit management was also highlighted as an aider for SMMEs to maintain financial stability and access funding when needed.

Insurance is often overlooked in financial management for SMMEs. The workshop covered the basics of ‘insurance’, explaining the different types of insurance policies available and their benefits. By understanding insurance, businesses could protect their assets and ensure continuity in the face of unforeseen events.

Legacy planning is essential for business owners who want to ensure their enterprises continue to thrive beyond their tenure. The workshop addressed ‘legacy planning’, including succession planning, estate planning, and the importance of setting up structures that safeguard the business’s future. Effective legacy planning could provide peace of mind and ensure the longevity of the business.

Effective business finance management is crucial for the sustainability and growth of any SMME. The workshop offered comprehensive training on managing business finances, including budgeting, financial forecasting, and cash flow management. Participants learned how to create and maintain financial statements, which are vital tools for monitoring the financial health of their businesses.

After the workshop, participants received certificates confirming their training in money management with FNB. This certification validates their newfound skills and serves as a testament to their commitment to financial literacy and responsible money management. This recognition could enhance their credibility with customers, suppliers, and potential investors.

Siphelele Sicwe, the Director of Frame Loops Media PTY (LTD), a company that deals in events coverage (photography and videography) and provides record label expertise to up-and-coming artists, and is a small business owner and was present at the event, expressed his excitement at the opportunity to be a part of something he said could change the way he managed his money forever.

“I am very happy about the collaboration between GKM, EDTEA, Seda, and FNB, this is a prime example of how partnerships can support us SMMEs in Kokstad. Each partner brought unique expertise and resources to the table, creating a comprehensive support system for local businesses. This collective effort ensured that we received well-rounded training and will hopefully also garner ongoing support from them,” said Mr Sicwe

Mr Sicwe added “When SMMEs thrive, the local economy always benefits and financially literate business owners are more likely to make sound financial decisions, leading to business growth and job creation. Hopefully, this workshop’s emphasis on financial literacy will create a ripple effect, boosting the economic vitality of the Greater Kokstad region.”

By Kamvalethu Xhelithole