Challenges Facing Small to Medium Enterprises in Metsimaholo Municipality, South Africa

Jeremiah Madzimure () and Lebereko Phillip Tau ()
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Jeremiah Madzimure: Vaal University of Technology, South Africa
Lebereko Phillip Tau: MANCOSA College, South Africa

Eurasian Journal of Social Sciences, 2018, vol. 9, issue 1, 14-23

Abstract: In South Africa, the failure rate of Small to Medium Enterprises (SMEs) amounts to 75% in an estimated interval of 42 months of operation. The purpose of this study is to determine the challenges facing SMEs in Metsimaholo municipality, Free State province of South Africa. Quantitative data was acquired from 102 Metsimaholo SME owners or their representatives, utilizing questionnaires which were completed, returned, and analyzed using Statistical Package for the Social Sciences (SPSS) version 26.0 software. It was then established that economic factors have realistic control on the sustainability of SMEs. In addition, further development of SMEs is restrained by competition from immigrant businesses, transportation of inventory, inadequate management skills, substandard marketing, miserable manipulation of financial activities and business, unreachable loans. Notwithstanding the afore-said outcome, SMEs must carefully look at obtaining business skills coaching and support, enlarge or vary the range of products, put back any profits made by a business into it in order to make it more successful. Cooperation amongst SMEs would be a strategy for them to challenge rivalry. Therefore, SMEs will bargain from transportation of goods bought in large quantities for a unit price that is lower than usual.

Keywords: Challenges; Failure Rate; SMEs; Municipality; South Africa (search for similar items in EconPapers)
Date: 2018
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