Is there a link between economic growth and SMEs success in South Africa

Louise Van Scheers

doi:10.21511/imfi.13(2-2).2016.09

Abstract

This research analyzes whether there is a link between economic growth and SMEs success in South Africa. The South African economy can only grow with the contribution of growing sustainably SMEs which will accelerate economic growth. The research concluded that SME success has a positive impact on sustainable economic growth in South Africa and that there is a link between economic growth and SME success. The conducted research recommends that by improving the success rate of SME, the South Africa’s stagnating economy

Highlights

South Africa represents a country of growing business opportunity in which the spirit of free enterprise is evident (Government Gazette, 2015)
The unfolding transformational process in South Africa is itself being threatened by the very challenges that it seeks to address unemployment, slow economic growth, and managerial skill shortages (GEM, 2012)
As the aim of this research was to gather information to analyze whether a relationship between economic growth and SMEs success exists, 200 questionnaires were posted to small business owners, 134 questionnaires were posted to each of the nine provinces of South Africa

Summary

Literature review

Capable managers achieve goals successfully, resourcefully and achieve targets with the minimum waste of resources. ♦ Enterprise-based problems that refer to the enterprise’s internal factors such as incompetent management, lack of managerial skills, and poor financial control. It is useful to consider the problems caused by factors outside the business by combining economy and industry based problems as macroenvironmental or exogenous problems and distinguish these from problems over which the individual owner has some control that can be identified as firm-based problems and classified as internal micro or endogenous problems. Macro economic variables such as interest rates, unemployment and inflation rates were considered. ♦ Personal factors: lack of business skills training, unwillingness to work long hours, unwillingness to apply new ideas

Research results

Summary of research findings and implications

Findings

Conclusion