Business owners in South Africa upbeat about starting a business - despite the impending local recession

Kirsty Rowett, EO spokesperson.

A survey by the global Entrepreneurs' Organisation - shows that 101 leading South African entrepreneurs from Johannesburg, Cape Town and Durban are upbeat about the economy with 85.1% indicating a willingness to start an additional business in the current economic environment. This is despite 70% of respondents predicting a deteriorating economic outlook for South Africa.

The optimism of local entrepreneurs is in contrast with the rest of the business sector where the predicted slowdown in the economy is impacting on overall business confidence as South Africa’s economy shrank in the second consecutive quarter. Gross domestic product fell 1.3 per cent quarter on quarter, far below analysts’ expectations, due to a sharper than predicted slowdown in the mining and manufacturing industries.

Business owners in SA were even more optimistic about their growth forecast than their global entrepreneurial counterparts, as 82% of the global respondents would start another business as a result of a more positive outlook.

The Global Entrepreneur Indicator, an international survey of business owners from around the world - conducted by the Entrepreneurs’ Organisation (EO) – has surveyed more that 10 000 worldwide entrepreneurs in 47 countries with 101 business founders/owners took part in the August 2015 survey.

The top line results highlight that although only 5% of the SA entrepreneurs predicted an improved economic environment over the next six months, the general mood was positive and upbeat with 79% predicting an increase in full time employees as more than 95% forecast an increase in business revenue.

Kirsty Rowett - business owner of Source Food and board member of the Western Cape chapter – says the latest results are indicative of the positive nature of local entrepreneurs as well as their commitment to creating jobs in SA.

“EO represents established, medium size entrepreneurial businesses which is a key driver of job creation in South Africa. Although 60% of our local members believe their access to capital will stay the same, they are willing to grow their existing businesses and invest in new ones with 79% predicting an increase in number of full-time employees – underscoring the notion that entrepreneurs are willing to take risk, innovate and grow their ventures. Entrepreneurship is flourishing in South Africa.”

Methodology: The EO Global Entrepreneur Indicator Survey examines the current economic market and realities for entrepreneurs, and gives insight into their predictions for the next six months. Nearly 3,700 of the more than 11,000 business owners that comprise the Entrepreneurs’ Organization’s membership responded to the survey. Respondents represented 149 chapters from 47 countries. Participants were presented with 14 questions assessing current and projected economic health. During the survey period, 1-31 August 2015, responses were obtained by contacting members within each chapter to guide them to the survey materials. Reports were then issued to each of EO’s chapters around the world, based on the responses collected from each chapter’s members. For more information, contact Gustavo Vieira, EO’s Director of PR, at [email protected], or follow @EOIndicator on Twitter.

EO_INFOGRAPHIC, August growth despite the economy PDF.

South Africa GEI Report - August 2015[5] PDF.