Association of Business Skills toward Competitiveness of Businesses in the First Year of Operation in South Africa
Keywords:
bookkeeping, pricing skills, cash flow, liquidity constraints, competitivenessAbstract
This research examined the association of business skills that affect a business’s competitiveness in the initial year of operation. SMEs are the backbone of global economies and the first step toward industrialisation in developed and developing nations. South Africa has the highest rate of business failures among nations with less than a year of existence. In South Africa, most new businesses are founded yearly and fail within a few years. Due to domestic and international competition pressure, survivalist businesses remain static. In South Africa, businesses are just starting to face a shortage of expertise; this deficit has severely hampered the SME sector, particularly those in the initial year of operation. Lack of technical skills and a shortfall in leadership and pricing skills as barriers to business competitiveness. Phenomenological (qualitative) approaches were used to address the association of business skills that affect a business’s competitiveness in the initial year of operation, which creates barriers detrimental to a business’s ability to perform and compete. Explanatory research enabled to gain insights about of the relationships between the deficit, which severely hampered the competitiveness of businesses in the initial year of operation. Semi-structured interviews were one of the data collection methods employed in the study. The results showed inadequate bookkeeping, pricing, and leadership as barriers detrimental to a business’s ability to perform and compete in the first year of operation. The study concludes that businesses in the first year of operation should acquire accounting skills in order to help with future sales estimates, operating costs, and asset requirements for demand. Eliminating gaps is done through the bookkeeping and pricing skills' subpar business competitiveness in the first year of operation in South Africa.
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