The South African economy has yet to show signs of recovery with several large corporates across multiple sectors announcing job cuts in the first quarter of 2019. Retrenchment processes are the order of the day – capitalise on them.
The current economic crunch has translated into widespread retrenchments for South Africans, with many either starting 2019 off serving a notice period or walking into an uncertain work environment with the concern of retrenchment looming in the foreseeable future.
Almost every major sector from media and retail to mining and banking has at least one big player who is in process or likely to initiate retrenchment in the coming months.
Use your experience as a launchpad
As daunting as it may be, many workers who have been retrenched or are facing potential retrenchment will have to consider what other opportunities exist for them outside of the volatile job market. Moving past the emotional and psychological toll of being retrenched – both of which are significant and can’t be ignored – and exploring what options are best suited to you post retrenchment is important.
Firstly, you need to understand that the myth of job security is exactly that – a mostly fictional story of unknown origin.
In the last decade alone, South Africa has had to deal with two recessions each ushering in a wave of job losses on an unprecedented scale, further compounding the unemployment rate of 27%. Depending on your qualification and the position you were retrenched from, it will prove difficult to find another job at the same level of responsibility and pay grade as your previous job.
Particularly if you work in the banking, retail or mining sectors, your organisation is getting wise to the fourth industrial revolution and your retrenchment could largely be due to its drive to reinvent and reorganise itself to meet the changing needs of its customers.
Use your experience as a launchpad
You need to be current on the impact technological innovation is having and will have on your sector and specific work area. Relevant experience and a good grasp on the trends taking place in your sector can make entrepreneurship an essential option to consider in the quest to build yourself a new livelihood.
Realise that amongst the doom and gloom, there’s very real opportunities out there. Digital disruption is rippling through the economy as we know it and space for new ways of doing business are opening up for enterprising individuals.
Below is a short checklist put together for employees who have recently been retrenched and are considering entrepreneurship as a new career:
- Before you make the jump into entrepreneurship, ask yourself if you are in the position to cut back on unnecessary expenses: Direct whatever access to savings or funds you have to starting up a business. Things will get tight, but if you have spotted a good opportunity and are willing to commit and work diligently, the risk will be worth the reward.
- If you’ve been retrenched, hopefully you will qualify to receive a retrenchment package: This will depend on your employment contract and how long you have worked for the organisation. This funding, as limited as it may seem, can be used to produce and trial whatever goods or services you are looking to offer.
- Access to funding for start-ups is very hard to come by in South Africa: Keep these funds aside for whatever product development costs you will incur in launching the business. Be sure to seek the advice of a financial planner to assist you with budgeting your life accordingly.
- Some larger corporations offer entrepreneurship training as part of their skills development for their employees who have been retrenched: If your organisation does not offer this, look up incubators and entrepreneurship development programmes offered in your city (these range in quality so interview some entrepreneurs who have attended the institution you are considering before you sign up). This would be a good way to upskill yourself in starting and running a business.
- Understand the problem you are solving for your target market extremely well:If possible, interview as many customers who you intend to sell your product/service to first. Get a sense of where your competitors fall short and what it would take for your potential customers to trial your product instead.
- Pool together funds: Asking trusted colleagues/family/stokvel members to open help fund a franchise business is not a bad idea. This would still require research and planning but assumes less risk/responsibility for several facets of the business.
What is your ‘why’?
Taking the jump into entrepreneurship will arouse an array of mixed emotions ranging from excitement and eagerness to fear and caution. All these feelings are part of the journey and the best advice I can honestly give to anyone looking to take this journey is start with ‘why?’
If your why isn’t big enough to get you through the sacrifice and long hours required (entrepreneurs work longer hours on average than the general 9-5 job), you will break at the first sign of failure and find difficulty in realising your vision. Take your time to find your groove and remember to acknowledge the little successes you achieve everyday.