Is it possible that society has such a small percentage honest SME owners?
October 7th, 2009 — dodoOr does it not perhaps highlight the harsh realities of small business as being an extremely competitive environment where only a few really achieve success and the majority only survive?
This could very well be the reason why there are not a lot more BEE transactions done in the SME market, whilst there is a feeling amongst the broader population that BEE is only for a select few, thereby enhancing the perception that BEE is in fact nothing but the enrichment of a few.
Being successful in business could therefore mean different things to different SME owners. One thing remains unchanged however and that is that for purposes of structuring a BEE transaction the level of success is measured by the level of profitability.
Any SME owner therefore contemplating a BEE structure should strive to maximise the business’s profitability and simultaneously embark on a strategy of full disclosure in its audited financial statements.
Many SME owners are aware of these issues discussed above and then decide that the only way they can do a BEE transaction is to establish a separate trading entity as a new venture and to attract a BEE party into this new venture in order not to lose out on possible tenders requiring BEE status from the suppliers.
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