Industry body the Steel and Engineering Industries Federation of Southern Africa (Seifsa) has partnered with funding consulting firm VennCap Business Solutions to assist metals and engineering sector companies to secure funding for their businesses and enable them to chart a course to sustainability as efforts to revive the economy get under way.
It is important to help companies that have survived the lockdown to rebuild their businesses, while also supporting new, innovative ventures, says Seifsa CEO Kaizer Nyatsumba.
“We will be offering this service not only to our member companies, but to the industry at large. Small businesses, in particular, are encouraged to take up this service because of the additional challenges they face when applying for finance,” he comments.
Growth and investment in the labour-intensive manufacturing sector is pivotal in combating South Africa’s unemployment rate, which is at a record 32.5%.
"This alliance allows investors to invest in established, asset-rich businesses with a direct impact on the revitalisation and growth of the industry and the economy at large, says VennCap director Jeane Lourens.
“The time for collaboration between government, institutional investors, private equity and venture capital is now,” she adds.
Every player in the manufacturing sector needs to come to the table to support the industry, hence Seifsa is widening the net to reach all businesses in need of funding, says Nyatsumba.
Seifsa, as an employer federation that represents 1 223 employers and more than 160 000 employees in the metals and engineering sector, is cognisant of the challenges companies are facing as a result of the Covid-19 pandemic and related lockdowns and has seen some of them close their doors, unable to weather the national lockdown put in place to curb the spread of the virus.
“Some of these businesses needed funding to help keep the wheels turning during the lockdown. While we laud the efforts of the government and players in the private sector to support businesses through various relief funds, including the Covid-19 Loan Guarantee Scheme, there are many companies that slipped through the cracks as they did not meet the requirement for such funding,” he says.
“The partnership is one of the initiatives we have put in place to play our part in helping to turn the economy around. As the voice of employers in the metals and engineering sector, having played a critical role in supporting companies within the sector for almost 80 years, we are able to act as a conduit to help businesses in the sector access funding,” Nyatsumba notes.