Acta Universitatis Danubius. Œconomica, Vol. 15, No. 1 - 2

Authors

  • Collective Authors

Abstract

For the enterprise development policies to be applied there is a need to understand the real factors that can propel it.
Entrepreneurial thriving among Small, Micro and Medium Enterprises (SMMEs), informal sector as well as cooperatives in South
Africa, need support in order to grow, create employment and meaningfully contribute to the development of the country. This
article reports on the findings from a baseline study conducted in the Gauteng Province on the general state of SMMEs, informal
sector and cooperatives. Specifically, the article aims to profile those SMMEs, informal sector and cooperatives, as well as to
identify their basic needs that should be addressed by relevant stakeholders for their survival and growth. In South Africa, SMMEs,
informal sector and cooperatives, remain the cornerstone for the survival of thousands of South Africans, both in rural and urban
areas. Generally, the classification of those businesses in the correct categories in order to qualify for subsidy or sponsorship poses
a lot of challenges, especially in the big conglomerations (Johannesburg and Pretoria) of the Gauteng province. In South Africa
as well as in many other parts of the world, the classification of the SMMEs remains incongruent due to a number of factors,
including the size of the countries’ economies, the differences in the business environment as well as their changing conditions. A
research team met to discuss the design of the study, and descriptive data were collected in order to provide a good understanding
of the sampling units. A sample of 1000 SMMEs, informal sector and cooperatives, was used to carry out the study. Purposeful
and convenience sampling methods were used to select the respondents. A questionnaire was designed, then sent to the Gauteng
Department of Economic Development (GDED) to ensure that all the necessary profiling data was captured before its usage. The
questionnaire was filled by the respondents with the presence of the field workers. A company called STRATKON was used to
handle the data inputting and the SPSSX was used to analyze it. The study found that the current definition of SMMEs, according
to the 1996 Act, makes it difficult to know the real identity of these businesses; hence, it suggested different categories and presented
other features apt to rightly direct the aid and support towards these businesses. Recommendations to various and relevant
stakeholders were formulated.

References

Agwa-Ejon, J. & Mbohwa, C. (2015). Financial challenges faced by SMMEs in Gauteng-South Africa. International association
for management of technology IAMOT 2015 conference proceedings.
Arafat El-Mobayed, M.G. (2006). The relationship between strategic planning and growth in small industrial businesses in
Palestine case study: The Gaza Strip.
BER (Bureau for Economic Research) StatsSA. (2016). The small, medium and micro enterprise sector of South Africa. Research
Note 2016. Commissioned by the small enterprise development agency (SEDA).
Berry, A. (2002). The Economics of SMMEs in South Africa. Pretoria: Trade and industry policy strategies.
Booyens, I. (2011). Are small, medium- and micro-sized enterprises engines if innovation? The reality in South Africa. Science
and Public Policy, 38(1), February 2011, pp. 67-78.
Finn, A.; Leibbrandt M. & Oosthuizen, M. (2014). Poverity, inequality, and prices in post-apartheid South Africa. Wider working
paper 2014/127. Helsinki: UNU-WIDER.
Fin Scope (2010). Small business survey 2010. FinScope, South Africa.
Jackson, A.J. 2015. Can strategic management techniques be applied to small and medium enterprises? Social Science Research
Network. Online. Available: http://works.bepress.com/anthony_jackson/11/ categorisation.
Khosa, R.M. & Kalitanyi, V. (2015). Migration reasons, triats and entrepreneurial motivation of African immigrant entrepreneurs.
Journal of enterprising communities: People and place in the global economy. Vol. 9(2), pp. 132-155.
Kuratko, D.F. (2016). Entrepreneurship: Theory process and practice. Cengage Learning.
Mago, S. & Toro, B. 2013. South Africa government’s support to small, medium, micro-enterprise (SMMEs): The case of King
William’s town area. J Economics, 4(1), pp. 19-28.
Mahembe, E. (2011). Literature review on small and medium enterprises access to credit and support in South Africa. Pretoria:
Underhill Corporate Solutions.
Murimbika, M. (2011). Influence of strategic management practices on the entrepreneurial orientation of South African firms in
the financial and business services sectors. Master’s dissertation. University of Witwatersrand, Johannesburg, South Africa.
NCR (2011). Literature review on small and medium enterprises’ access to credit and support in South Africa. National Credit
Regulator, Pretoria, South Africa.
Njiro, E.; Mazwai, T. & Urban, B. (2010). A situational analysis of small businesses and enterprises in the townships of the Gauteng
province of South Africa. First International Conference, centre for Small Business Development, Soweto, 27-28 January 2010.
Rogerson, C. (2008). Tracking SMMEs development in South Africa: Issues of finance, Training and the regulatory environment.
Urban Forum, 19, pp. 61-81.
Statistics South Africa (Quarter 2: 2015). Quarterly Labour Force Survey. Pretoria.
Statistics SA. (2014). Quarterly labour force survey. Quarter 2.
Thaba, S.C. & Mbohwa, C. (2015). The nature, role and status of cooperatives in South African context. Proceedings of the world
congress on engineering and computer sciences 2015. Vol II, WCECS 2015, October 21-23, San Francisco, USA.
Thabo, M.M. (1999). (Online). Available on
www.gautengonline.gov.za/Publication%20and%20Reports/Cooperatives_Development-Policy_for_Gauteng_province.pdf.
The banking Association South Africa (2017). (Online). Available at http://www.banking.org.za/what-we-do/sme/sme-definition.
Accessed 05 June 2017.
The DTI (2008). Annual review of small business in South Africa 2005-2007. Pretoria: Department of Trade and Industry.
Turner, M.A.; Varghese, R. & Walker, P. (2008). Information sharing and SMME financing in South Africa: A survey of the
landscape. Centre for competitive credit, political and economic.

Downloads

Published

2021-06-28

Issue

Section

Articles