The challenges impacting the growth of small-, micro- and medium-sized textile enterprises (SMMEs): a case of Ekurhuleni Metropolitan Municipality
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Date
2021-07
Authors
Netshishivhe, Caiphus
Journal Title
Journal ISSN
Volume Title
Publisher
University of the Free State
Abstract
The South African Government has a good industrialisation policy framework. However, local textile producers, manufacturers and retailers in Ekurhuleni have been forced to shed jobs, down-size operations and sustain losses due to stagnant growth in the sector. The municipality is under pressure and desperate to find a new way to restore the local textile industry to save jobs. The aim of the research was to uncover the factors adversely affecting SMMEs in the textile industry; to identify factors that will assist to develop and sustain textile SMMEs; and lastly, to make recommendations on the shortcomings uncovered. The study used a survey questionnaire to collect data about the business owners’ demographic profile, size of the business and owners’ understanding of their experiences or opinions on factors affecting the development and growth of their businesses. The data showed that at least 60% of the businesses were female owned and 70% black owned. Moreover, only 40% of the business that had requested financial assistance, from government agencies, had successfully received funding. The lack of management skills, difficulty maintaining relationships with customers, difficulty maintaining relationships with customers, lack of support from government agencies, textile variety, and perceived over-regulation of the local textile industry ranked low. Therefore, these factors had minimal impact on the viability of SMMEs in the textile industry. In contrast, the difficulty in obtaining loans, ordering on credit, accessing markets, severe competition from rivals, high cost of premises, and high cost of labour significantly impacted the viability of SMMEs in the textile industry. The ability to interact with potential customers and clients, communicate with employees and co-workers, make business-related presentations to potential customers and clients, network with valuable suppliers, and monitor and order stock regularly had a low rating on the scores for the contribution for sustainability. These factors therefore had a minimal contribution to the sustainability of SMMEs. Therefore, a lack of technical and strategic management skills as well as a poor implementation of the policy and regulatory framework had no impact on the growth and sustainability of SMMEs in the textile industry. Moreover, access and affordability of finance and credit facilities had an adverse impact on the feasibility of SMMEs. Compliance issues have a low contribution to the sustainability of SMMEs.
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Keywords
Dissertation (MDS (Development Studies))--University of the Free State, 2021, South Africa government -- Industrialisation policy, Textile producers, Manufacturers and retailers -- Ekurhuleni, SMMEs (Small, Medium and Micro Enterprises)