Chiliya, N.Ndou, A.Magodi, Fariso2026-06-222026-06-222026-05-19Magodi, F. 2026. A comparative investigation of the success factors affecting local- and foreign-owned SMMEs in the Thulamela Local Municipality. . .https://univendspace.univen.ac.za/handle/11602/3275MCom in Business ManagementDepartment of Business ManagementGlobally, 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.1 online resource (xi, 127 leaves)enUniversity of VendaChallengesUCTDForeign-owned SMME'sLocally-owned SMME'sSuccess factorsDissertationMagodi F. A comparative investigation of the success factors affecting local- and foreign-owned SMMEs in the Thulamela Local Municipality. []. , 2026 [cited yyyy month dd]. Available from:Magodi, F. (2026). <i>A comparative investigation of the success factors affecting local- and foreign-owned SMMEs in the Thulamela Local Municipality</i>. (). . Retrieved fromMagodi, Fariso. <i>"A comparative investigation of the success factors affecting local- and foreign-owned SMMEs in the Thulamela Local Municipality."</i> ., , 2026.TY - Dissertation AU - Magodi, Fariso AB - 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. DA - 2026-05-19 DB - ResearchSpace DP - Univen KW - Challenges KW - Foreign-owned SMME's KW - Locally-owned SMME's KW - Success factors LK - https://univendspace.univen.ac.za PY - 2026 T1 - A comparative investigation of the success factors affecting local- and foreign-owned SMMEs in the Thulamela Local Municipality TI - A comparative investigation of the success factors affecting local- and foreign-owned SMMEs in the Thulamela Local Municipality UR - ER -