The years 2009 and 2010 have been undoubtedly the toughest years for business both on the South African political and economic platform as well as internationally. Even the world cup event hosted right in our backyard was incapable of significantly mitigating the effects of the global economic meltdown.

The above said, even as I would confirm at this point that several businesses both in the small/ medium and large segments have closed down (take a look at the financial distress/ receiverships & liquidations stats), an encouraging number of small businesses have survived. A few have even used the adverse economic climate to grow and excel to greater heights. Many professional argue that the survival of small/medium enterprises is due to the inherent advantage they hold arising from being owner managed and hence decision making is often very flexible and quick making them more responsive.

Whatever the case may be, I am particularly confident that the economic recovery that is already visible at this point will start filtering down into all sectors of the economy stimulating economic activity across all enterprises including small/ medium enterprises in the 2^nd half of the year (2011) and we should start to see improvement in business and therefore wellbeing of most enterprises.  I would like to urge all business to continue exercising discipline, managing costs, continue with marketing and sales efforts and being innovative in the adoption of business models that ensure efficient and yet effective ways of doing business.

I may not be quoted, that said however, “for business that ensure survival until the 2^nd part of 2011, these will most likely remain in operational existence for a relatively long time”.

If there is a positive that has come out of this economic recession is that we all have been educated and re-educated around points of;

·       Financial management:- budgeting, exercising caution on expenditure and being efficient (doing more with less);

·       Good cashflow/ working capital management, and;

·       Governance: - ensuring good business practice overall especially compliance from the legal, reporting and tax perspectives.

As earlier stated, from now on things can only get better so here is to wishing you a prosperous 2011.

Intellogic Africa Business Consulting ("IABC") is founded & managed by Mwendabai Kalaluka, a Chartered Certified Accountant who also holds a Masters of Business Administration from University of KZN Graduate School. He has extensive experience in Accounting, Finance, Taxation, Marketing & Research  obtained from Public Accounting Practice & has also worked extensively as a Financial Analyst for a large Oil Multinational  and very recently as a Strategy Analyst at one of the big banks.