It's no secret that a region's entrepreneurial community is an indicator of its overall economic health. But do you know which industry - for entrepreneurs and established companies alike - is recognized as one of the most effective vehicles for economic growth?
The answer may surprise you. As entrepreneurs, it may also inspire you.
Tourism, especially for an up-and-coming country like South Africa, most effectively drives economic growth. According to Mariette du Toit-Helmbold, formerly the award-winning CEO for ten years of Cape Town Tourism, and her business partner Annareth Bolton, who was CEO of Stellenbosch Wine Routes for nine years, entrepreneurs find fertile ground within the tourism industry of South Africa for two very significant reasons.
First, tourism has very few barriers to entry in terms of labor and new businesses, which is especially good news for small- and medium-sized companies.
And second, in South Africa, the overarching aim of the National Development Plan is to eliminate poverty and reduce inequality by 2030. A proactive mission of the plan is to stimulate a mindset of entrepreneurship, particularly for more rural and unknown regions, with a focus on small- to medium-sized enterprises and black owned businesses that operate at a local level.
One of the most active entrepreneurial verticals - food and wine - is particularly suited to the sweeping vineyard landscapes and diverse culinary history of the Western Cape. Wine tourism in particular benefits from a well-articulated national strategy and coordinated plan, du Toit-Helmbold and Bolton said, as it aims to contribute R16 billion (USD 1.23 billion) to the GDP by 2025, up from R6 billion (USD 0.46 billion) today.
That's where the space for innovation comes is, along with the food component of hospitality. Here are five reasons why wine and food entrepreneurs in South Africa are succeeding.
Wine Tourism is Not about the Wine
The strongest reason for the success in South Africa of wine tourism is also perhaps the most oxymoronic: the wine tourism strategy is not a wine strategy, du Toit-Helmbold and Bolston said. It is a tourism strategy. "Simply put, what is making wine tourism so successful in South Africa is that it has become about much more than just tasting wine." Entrepreneurs hang their hat on experiences.
Step Inside the Kitchen Culture
"Visitors now want to be included in the food preparation process," du Toit-Helmbold and Bolston said. "It is all about being part of the kitchen culture of a destination. Cooking in chefs' homes where an intimate group of diners, or even a couple, interact with a regional chef or authentic home cook and watch as off-menu courses are prepared and served, are the kinds of restaurant experiences food tourists crave."
Cultivate "Citizen Guides"
Entrepreneurs look to spotlight neighborhoods and experiences that only locals - the people who live there all the time - know about and can introduce guests to. Developing the network is a matter of establishing trust, both on the part of the locals to safely deliver the experience and on the part of the visitor who's stepping into an unfamiliar but authentic experience.
Tour companies who provide travel packages build flexible itineraries, so that more free time is available to guests. Building in that free time impacts the curiosity level of visitors, who are perhaps more alert to the opportunity to engage in activities of their own choosing. What they choose to do with that free time are further indicators to the entrepreneur of activities of interest.
Entrepreneurs organize according to themes, such a cycling, family friendly wineries, festivals, and unique local foodie experiences. The "add on" temptation in this case is appealing for the bottom line - selling ornaments made in China, for example, in a South African wine tasting room - but it runs contrary to the authentic product and experience. Successful initiatives stick to the local program.