Impact of the department of small business and development on the performance of small, medium and micro enterprises in Durban, South Africa.

Abstract

This inquiry unpacks the challenges constraining the active contribution of the Small Medium and Micro Enterprises (SMME’s) by putting the focus on the role that is played by institutions like the Ministry of Small Business that has been created by the government to support SMME’s. The objective of the study was to find out from the SMME’s the extent to which the Department of Small Business Development (DSBD) and other institutions have been able to address the factors that have been identified as hindering the growth of the SMME’s. The review of literature focused on theories such as economic growth, institutional theory, network theory and social entrepreneurship theory. The extent of the literature review examined the emerging markets in terms of the authorities’ handling of the SMME’s performance oriented endeavours and aspirations. The study was conducted in KwaZulu Natal, within eThekwini Municipality. The population of the study comprised of 800 SMME’s of which a sample of 260 was chosen. The research approach that was employed was the quantitative methodology. Data was collected by means of structured selfadministered questionnaire. The results of the study revealed that the majority of SMME’s have never received grants, loans, finances, favourable discounts, and favourable credits. The result of the study revealed that the majority of SMME’s have never received grants, loans, finances, favourable discounts and credits form conventional banks and big companies. Furthermore the majority of the respondents indicated that DSBD has not been able to assist them as it was envisaged it would do. The study showed that the technical support, access to markets, business environment, business climate, competitive business landscape and the external environment in general is not conducive for the SMME’s to thrive. The study revealed that there is stride that DSBD is playing concerning the creations of networks, collaborative partnership and associations although less than 50% indicated so. It is recommended that the financial resources be made more accessible by the SMME’s irrespective of where they are and that the policy-makers must reinforce the laws that compels big companies to spend the 3% of the post-tax profit as the compliant requirement in the support of SMME’s. It is further, recommended that the DSBD should do more in stimulating the Economic Growth Factors on behalf of the SMME’s should facilitate the coordination of different institutions in assisting them not to work silos. . Lastly, the study recommended that the SMME innovation and capacity building, which translate into market opportunities, should be the focal point of attention for the DSBD. The literature review explored various concepts, theories and typologies that influence policy directives that provides stimulus for entrepreneurial activation. Theoretical framework focused on various theories that has levelled the entrepreneurial playing field for the SMME’s to thrive. The research design employed was the quantitative methodology. Data was collected by means of structured self-administered questionnaire. Furthermore, the majority of the respondents indicated that the DSBD has not been able to assist them as envisaged.