Ithala experiences have made it an undeniable necessity to set up a robust and well functioning business support function within Business Finance. The majority of the clients profile served by Ithala requires that business support be provided if these entities are to successfully implement their business plans. The aggregate feedback from these lessons is that the provision of finance and access thereto alone are not panacea solutions to a successful business unit, but the addition of business support is an equally significant variable.

Drawing from its mandate, Ithala has a responsibility to drive economic empowerment within the province and the provision of non-financial support is key to the fulfillment of this responsibility. It was therefore imperative to have a function within Ithala that administers the business support activities.

 Although projects and businesses funded by Ithala have performed poorly due to various reasons, lack of business support is one of the leading causes. Ithala’s client base (i.e. emerging entrepreneurs) presents unique challenges owing to the prevailing socio- economic environment.

 Whist entities in the first economy have the skills and expertise to adapt to changing economic environment; SMMEs & Co-ops are hugely limited in this regard. Whilst there is a high cost involved in providing business support services directly to individual enterprises, if the assisted business grow and create significant employment, the long term payoff can outweigh the costs.

 Ithala’s experience has shown that a Business Support function, left entirely to be administered by an external organization, does not yield the desired impact hence the function should be controlled and administered from within Ithala for better management of contractual relationship with service providers. The Business support unit has been created to bridge this gap.
 

The Business Support model indicates clearly the services that would be provided in-house and those that would be outsourced. In view of past experiences, solid service level agreements will be entered into to ensure value for money in cases where outsourcing becomes an option. Provision of non-financial support to the target market is generally expensive and unaffordable to the majority of recipients. Ithala aims to raise grant funding to subsidize the cost in order to achieve widespread impact, and the desired objectives. In this respect, the Department of Economic Development and Tourism is a key player in unlocking such funding.