Impact of Customer-Supplier Relationships and Facilitation of Credit on Development of Micro Enterprises in KZN Rural Areas

Abstract

The aim of the research is to identify the impact of customer-supplier relationships in terms of facilitation of credit, on the development of Micro Enterprises in the Sobonakhona Makhanya Tribal Area. Micro enterprises in three rural villages – Adams Mission, Madundube, and Umbumbulu were identified as the target population. Three research assistants using a convenient sampling method selected the research respondents. This is a qualitative study, which entailed an empirical research by means of a questionnaire as a measuring instrument. It was found that the nature of the relationship between the suppliers and institutions and Micro Enterprises influenced their accessibility to credit facilities. Most were rejected credit while some did not apply because they assumed that their application would be rejected. It was found, however, that those that applied to wholesalers for credit were successful. The rejections of the respondents’ applications were mostly based on their inability to provide sufficient collateral and business plans. Most importantly, those respondents that did obtain credit, experienced positive changes as a result of their increased facilities. DOI: 10.5901/mjss.2014.v5n20p819