Department of Business Management

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Browsing Department of Business Management by Subject "354.27990968257"

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    A comparative investigation of the success factors affecting local- and foreign-owned SMMEs in the Thulamela Local Municipality
    (2026-05-19) Magodi, Fariso; Chiliya, N.; Ndou, A.
    Globally, small, medium, and micro enterprises (SMMEs) are considered vital drivers of economic expansion and development, contributing significantly to the economic prosperity of a nation and its inhabitants. In South Africa, they account for approximately ninety five percent of all operating enterprises, roughly sixty percent of the formal labour force and thirty percent of the country's GDP; despite these significant contributions, a greater percentage of small businesses fail in their early stages. SMMEs are thought to have a failure rate that ranges from 70% to 80%, with about 50% of SMMEs failing within the first five years. Both foreign and locally-owned SMMEs face similar challenges, although, foreign-owned businesses encounter unique obstacles, such as xenophobia, racism, and language barriers. Foreign-owned SMMEs, nevertheless, continue to thrive and grow, often outperforming their locally-owned counterparts. The existing literature on the development of SMMEs, primarily focuses on locally-held SMMEs and makes little to no mention of SMMEs owned by foreigners. This study aims to comparatively investigate the success factors affecting locally- and foreign-owned SMMEs in Thulamela Local Municipality.This study adopted an interpretive method and an exploratory research design was employed. Qualitative research method was exploited to select 16 SMMEs within the municipality - 8 foreign-owned and 8 locally-owned. Data were gathered through in-depth interviews guided by a structured interview schedule, while the sample size was determined by data saturation after using a purposive sampling technique to select participants. The data was then analyzed by thematic analysis using Atlas software. This study's results show that the success of local- and foreign-owned SMMEs, in the Thulamela Local Municipality its mainly dependent on human capital factors, such as education and training, business skills and experience; social capital factors, such as kinship network, social network, group network and information sharing; as well as cultural factors, such as owners’ propensity for long working hours and hard work. Both groups demonstrated these characteristics, however, foreign SMMEs owners use these factors more effectively and strategically, hence making them more competitive than local SMMEs owners. Both local- and foreign-owned SMMEs experience challenges from - crime, financial constraints, market and competitive pressure, government rules, regulation and licensing, lack of government support and services. There were, however, distinct extra challenges for foreign SMMEs - xenophobia, stereotyping and discrimination. Winning strategies employed by foreign SMMEs include - bulk buying, competitive pricing strategy, technological adaptation and cross promotion. This study recommends that local SMMEs invest strongly in social networks and human capital, while also following some of the strategies proven successful by foreign SMMEs’ owners to remain competitive.
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    The Contribution of Microfinance Institutions to Entrepreneurship Development in the Vhembe District, Limpopo Province, South Africa
    (2026-05-19) Mariba, Tshiangwa Knowledge; Chiliya, Norman
    This investigation examines microfinance as a mechanism for enabling sustainable enterprise development within South Africa's distinctive socio-economic landscape, with particular attention to the Vhembe District of Limpopo Province. The research interrogates how financial intermediaries serving excluded populations influence poverty reduction trajectories and economic advancement pathways. The literature review synthesises diverse scholarly sources to explore microfinance’s conceptual foundations and evolutionary trajectory within South African contexts, with particular emphasis on financial inclusion and entrepreneurship development. Evidence reveals multidimensional benefits extending beyond capital access to encompass entrepreneurial capability development, employment generation, and gender-based economic empowerment. Methodologically, this qualitative inquiry gathered experiential data through twenty semistructured interviews with owners and managers of SMME’s who had engaged with microfinance services. Interview transcripts underwent systematic thematic analysis using ATLAS.ti software, revealing patterns illuminating how microfinance interventions shape both enterprise success and operational challenges faced by small business proprietors. Research findings illuminate microfinance's transformative potential while acknowledging complexities surrounding interest rate structures, repayment frameworks, and regulatory constraints. The analysis underscores requirements for differentiated support mechanisms acknowledging diverse entrepreneurial needs and aspirations characterizing South African business landscapes. This study provides contextually grounded insights into how microfinance is experienced by SMME owners in the Vhembe District, contributing empirical evidence to broader debates on financial inclusion and rural entrepreneurship in South Africa. Generated insights offer preliminary guidance for policymakers, practitioners, and researchers seeking to strengthen microfinance strategies in rural South African contexts, while acknowledging the inherent limitations of a single-site, cross-sectional qualitative design.