As a business owner, you can benefit from incentives and business development schemes.
For instance, our front page story in the just release March edition of Small Business Connect cover the new youth wage incentive. In this edition we also report on the support promised by finance minister Pravin Gordhan in his budget speech (see page three of the newspaper for that story).
The youth wage incentive seeks to employ more young people while every participating business is rewarded with a “refund”.
At first glance, it looks like both the young employee and the business will benefit.
But, if you do not carefully consider your own situation, you may try to benefit from the incentive, while in fact you are shooting yourself in the proverbial foot.
The businesses most suited for this incentive scheme are those with staff who earn salaries lower than R4 000 per month and where on-the-job training is easy to do.
If you fall into this category, you may find that the incentive offers a big cost-savings opportunity.
However, the problem with many incentives such as this is that they may distract business owners from their core focus, which should be about creating value for and serving the needs of their customers.
You can also read the page seven story in the March edition to get this perspective. This is the story of Xolani Mthsizana of Keep Digging Africa, where you see how focused attention to creating value builds success – not running after every available incentive!
Rather than rush into the youth wage scheme, weigh up the financial benefit against the impact that less experienced staff will have on your business.
If it works for your specific conditions, use the opportunity – not only because it will offer you financial benefit, but also because it will give one or more young people the chance to gain some experience.
What is very interesting to note about the youth wage scheme is the way that The
Receiver chose to administer the “refund”. The employer will be able to deduct the figure from its employee tax liability.
This makes it really easy to use and does not add much to the administrative burden of a participating business.
This is a good sign that the talk of reducing red tape is in fact positively impacting the practical realities of small business owners.