Abstract
Notwithstanding the growing interest in business incubation programmes and the benefits derived from such programmes, the path is beset by numerous challenges. This paper investigates the challenges faced by business incubators (BIs) as they strive to support their clients. The study utilized a qualitative approach to collect data by way of interviews to gain in-depth knowledge and understanding of the concept and challenges of business incubators. The data were collected using structured and unstructured in-depth personal interviews, which were carried out with the respondents of business incubators in the Western Cape. The research participants for this study were limited to the business incubators on the database of a local organization that promotes small and medium enterprises (SMEs) development strategy and programmes in the Western Cape Province. All five business incubators on the database were deemed suitable for the study. The results indicated that an average of twenty-five entrepreneurs graduated from the incubation programme in the last five years. Furthermore, lack of sponsorship, production space, advanced technological facilities (prototype) and expansion to different areas were found to be among the challenges hindering incubators.
Highlights
Given their sheer numbers and propensity to fail, one may argue that making sure that Small and Medium size Enterprises (SMEs) are self-sustaining, would be the right step towards ensuring economic sustainability in any economy
The sub themes below are interpreted to address the research question of what the challenges are that are faced by business incubators in the Western Cape Province, South Africa
Drawing from the respondents’ responses, an average 25 of entrepreneurs both graduated and were in the graduation phase. This sub theme set out to ascertain the number of SMEs that have graduated from the incubation programme
Summary
Given their sheer numbers and propensity to fail, one may argue that making sure that Small and Medium size Enterprises (SMEs) are self-sustaining, would be the right step towards ensuring economic sustainability in any economy. Previous researchers mentioned that business incubators in developing countries face a number of challenges concerning innovation and creativity. Notable among these challenges are: lack of entrepreneurial skills, lack of venture capital, poor growth rate, productivity falling behind, aging population, downsizing, and the lack of true entrepreneurship [8,9]. Owing to the foregoing challenges, business incubators find it difficult to uphold their mandates as development agents [1,2,10] and in, some cases, their long-term survival becomes threatened This may negatively affect SMEs who depend on them for survival [11]
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