Small business research

Doing business in Africa and problems/opportunities faced by small, medium and micro enterprisesBold text

Small, medium and micro (SMMEs) enterprise in South Africa

The following organisation conduct research on SMME's in South Africa. (this list is not comprehensive list)

SME Survey (Pty) Ltd

GEM Report

SME Survey (Pty) Ltd
Is an annually research project, started in 2003, that conducts random telephonic interviews with small business owners/decision-makers with less than 200 employees. It is an annual project and with an average of 5000 interviews year on year it has been labelled the largest research conduct on SMEs in South Africa. This non-profit organisation surivivors with great sponsors backing this research.

This research has shown that ADSL uptake has drastically increased over the years by SMEs in South Africa with less than 1% of this random sample indicating ADSL as their main source of internet conncetivity in 2003 and by 2007 just under 60% have indicated that their main form of internet connectivity is ADSL. They have seen a direct cannibalisation of the Dial up connection which was sitting at over 60% of the sample using it in 2003, to now just under 10% using Dial up. This indicates that a higher form of internet connectivity is being used by SMMEs in South Africa.

Key findings in the SME Survey 2007 research indicated that:

A range of resources in use by SMEs can be linked to high levels of competitiveness, with IT, HR and the Internet being key differentiators. However, these resources do not by themselves create winning companies, and must be embraced where they are relevant and where the business case is clear.

The factor worrying SME decision-makers the most in South Africa is crime, which appears to have a significant impact on business confidence. Cash-flow concerns follow close behind.

While the ability to acquire Black Economic Empowerment status has emerged as a significant issue for SMEs, it has not become more important for SMEs in the past year, and has not had an impact on procurement policy among SMEs. This is largely as a result of the finalised BEE framework exempting smaller businesses – below a certain turnover and staff size – from requirements for complying with a BEE scorecard.

Access to Finances and Access to Skills and Expertise remain the critical resources SMEs require for both starting and running enterprises, but satisfaction with such access remains poor. The enabling environment for SMEs lags far behind the needs of SMEs, and this lag has translating into lower levels of competitiveness.

Work experience remains the key source for learning the skills and developing the expertise to start and run a small or medium enterprise. This, in turn, emphasises the critical importance of job creation in order to stimulate and underpin entrepreneurship in South Africa.

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