Earlier this morning, I got a call from a friend, Jobe, who wants in on training. Like most other people who contact me on this matter, the primary driver is usually a belief that there is money to be made. But no idea on where to start.
As a risk mitigation mechanism, I prefer to blog over providing information exclusively to those who have my contact details. I suspect there is an ethical risk in sharing information exclusively with those close to me if it relates to my work. By posting it in the blog, it becomes readily available to everyone and anyone.
I told Jobe that I am not a business consultant. I find it odd that I get approached by people who have nothing else except the desire to make money; no business plan, no market research, no finance, no innovative idea. Somehow, I am expected to answer all these questions for them, which is equivalent to drafting a business plan for them, for free, from scratch.
It is different when a person has done some work but hit a snag, or bottleneck that they would like to have someone assist them unblock. It takes less effort and time to assist that person, or direct them to where they will get help.
One of the questions Jobe asked this morning, was which skills training is the most in demand. Clearly, he wants to start a training business that will have a ready market. I do not know the answer to his question, and I do not think I have the time to research and find out on his behalf. He needs to find out for himself. I am even doubtful of the correctness of his question as some of the wrong questions tend to elicit unhelpful answers.
This is the sixth paragraph and it’s still an introduction. Making money requires a lot of reading rather than shortcuts. Jobe, as an aspirant entrepreneur ought to be willing to expand effort in finding relevant information, which can sometimes include distilling the relevant information from a cocktail of relevant and irrelevant information.
So you want in on the training, huh?
Of course the Department of Higher Education and Training (DHET) has a responsibility to contribute on skills development in the country. Among others this is done through the Sector Education and Training Authorities (SETAs). There are about 21 SETAs covering various sectors of the economy.
The companies in those sectors of the economy, who meet a particular threshold of the number of employees, pay a skills levy. Those levies are the income of the SETAs.
Once the money, from the levies reaches the SETA, it can be spent, largely, in two ways.
Firstly, the money may be spent in mandatory grants. The companies which paid the levies submit their skills development needs and costs to the relevant SETA. The SETA then allocates that company a portion of what it needs to meet its training requirements. The company then submits report on the work it has done on training. This is done annually.
Secondly, there are discretionary grants. This is the money the SETA spends in supporting the sector through bursaries, learnerships, internships, apprenticeships, artisanships and other training.
So, where is the money at?
At the risk of stating the obvious, Jobe needs to first register a company, which can be done at the Companies And Intellectual Property Commission (CIPC). He then needs to open a bank account for the company, register the company at SARS and all the basic things of setting up the company.
If the company intends to be a skills training provider, then it is going to need accreditation. It is a sort of licence that is proof that the company is competent and allowed to lawfully provide certain skills, after which the trainees can get meaningful certificates.
The company would apply to the relevant SETA for accreditation. There are obvious requirements for this, depending on the sector. For example, it would be odd if the computer training company did not have computers, or if it had computers but the trainer had no academic/professional credentials. The company owner would have to find out how to register from the relevant SETA.
Now that the company is accredited, what next? Well, an employer who has funding for training from the SETA will contract a skills provider to train its employees, and pay that skills provider for the training. I do not know how the employers select skills providers.