SMME development in Johannesburg's Southern Metropolitan Local Council: An assessment

Abstract

This article addresses the development, management and needs of small, micro‐ and medium enterprises (SMMEs) in Johannesburg's Southern Metropolitan Local Council (SMLC), with particular focus on business development by previously disadvantaged South Africans. The article comprises an introductory section on the small‐business sector in South Africa and internationally, as well as the results of a field survey of a sample of 841 SMMEs in the SMLC. Many of the respondents were located in areas like Soweto, Orange Farm, Eldorado Park and Lenasia. Given the areas’ poverty and a history of neglect, the bulk of respondents were small, micro‐ or survivalist enterprises. In part, the survey confirmed some generally held notions about small businesses. Among these were funding difficulties, a strong desire for business‐related training and serious informational problems. The study revealed a shortage of management skills and poor record‐keeping. At the same time, some evidence emerged of business potential, including high survival rates and a determination to succeed. Key recommendations include training programmes in such areas as record‐keeping, marketing, customer relations, inventory control and tendering procedures. Mechanisms are also suggested for facilitating access to finance.