Analysis of capacity building indicators and their influences on the viability of farming small, micro and medium enterprises (SMMEs) in South Africa

Abstract

Farming small, micro and medium enterprises (SMMEs) have been marked as a key strategic priority for food security, job creation and agrarian development in South Africa. Most of these farming enterprises are formed as results of government initiated land reform. The recent studies points out that these SMMEs lack capacity to operate as business entities. Their capacity profiles have not been documented either by government department nor research institutions. Various researchers have hinted on the need for the capacity development for these enterprises in order for them to play a vital role in the socio-economic sphere. For the revitalisation of perpetual collapsing farming SMMEs, it is important that capacity profiles be examined. The aim of this paper was to investigate the capacity profile of the farming SMMEs with an objectives to suggest a tool determining capacity requisites that may enhance their viability. In this study, both quantitative and qualitative research approaches were used. The data was collected during focus sessions and workshops. The survey instrument in the form of self –completion questionnaire comprising of 35 closed –ended items was used. These questionnaires were administered to a sample of 105 farming SMMEs across the six (n=6) provinces of South Africa. The results revealed that for small and micro enterprises to be viable, key success indicators such as sustainable markets, input supply, production, increase income/cash flow and business operations would have to be developed. In addition, it was found that medium enterprises have better capacity and for their capacity to be strengthened, an appropriate intervention may be required. Key words: Models, development, socio-economic, land reform, capacity.