Running a business in South Africa requires more than ambition, with many SMEs still being held back by avoidable mistakes in cash flow management, financial discipline, digital adoption and long-term planning.
Umesh Madhav, provincial head of coverage for Business Banking | image supplied
That is according to Umesh Madhav, provincial head of coverage for business banking in Gauteng at Standard Bank South Africa, who says resilience is built through clarity, planning and strong business networks rather than chasing trends.
He says one of the most common problems is that entrepreneurs overcomplicate their businesses instead of focusing on the core activity that actually makes money. Businesses that understand their main source of income are generally better positioned to stay disciplined and make sound decisions.
Cash flow remains another major pressure point, particularly for cash-heavy businesses such as retailers, salons, taverns and fast-food outlets. Madhav says businesses need to plan inflows and outflows carefully, manage cash securely and avoid keeping large amounts of money on site.
He also warns that many entrepreneurs still blur the line between personal and business finances, which makes it harder to measure performance properly and build a sustainable operation. Using dedicated business accounts, tools and reporting systems is important even for smaller businesses, he says.
Digital tools can also help smaller firms operate more efficiently, improve record-keeping and build a financial track record. Madhav says digital payments reduce administrative burdens and create traceable transaction histories that can support funding applications and business growth.
At the same time, he notes that cash still plays a major role in the South African economy, particularly for township businesses, spaza shops, salons, eateries and seasonal traders. For these businesses, balancing cash and digital payments, using proper cash-management processes and tracking every transaction remain essential.
Madhav adds that relationships with banks, suppliers and business partners should be built before problems arise, not during a crisis. Strong networks can help businesses manage pressure and unlock opportunities that may otherwise be out of reach.
He also points to formalisation as an important step for small and informal businesses. Standard Bank’s Township Informal Economy Report, published in October 2025, found that nearly 80% of township businesses remain unregistered, which can limit access to funding, supplier contracts, e-commerce opportunities and long-term stability.
Beyond day-to-day operations, Madhav says SMEs should prepare early for busy trading periods by collecting invoices, meeting obligations and renegotiating supplier terms where needed. He also encourages businesses to look at growth opportunities beyond South Africa, including regional trade and export markets opened through frameworks such as the African Continental Free Trade Area.
He says the businesses most likely to endure are those that focus on consistency, healthy cash flow, reliable systems and strong client relationships rather than short-term hype.
If you want, I can make this a bit sharper and more Bizcommunity-style, because the headline can also hit harder.
