An investigation of the key barriers preventing development of Small Medium Enterprises (SMEs) in the South African construction industry

Mbambe, Putumani (2020) An investigation of the key barriers preventing development of Small Medium Enterprises (SMEs) in the South African construction industry. [USQ Project]

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Mbambe_P_Mr Gary Elks_Redacted.pdf

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The aim of the research project was to determine the prevalent causes that contribute to slow development of SME contractors, to learn whether business owners understand the constraints slowing the development of their business and whether the existing government initiative programs are sufficient to support the development of SMEs.

A quantitative research method was be adopted as a method of conducting this study. The primary data was collected using a structured interview guide which incorporated the research questions. The salient findings of this study are:
• SME contractors lack start-up capital and are unaware of the information related to access to capital published by the government
• SME contractors do not receive capital from banks when they don’t have security or income
• SME contractors are still paid later than the 30 day period for completed projects
• Half of the SME contractor owners who had started their construction companies lacked construction project management training

The conclusion of the study was that SME who have start-up capital have high probability of growing their businesses than those who have not. The lack of access to information must be addressed by the government to ensure all SME contractors have an equal opportunity. Government departments together with private sectors must be constantly informed about the negative consequences that late payment has on SME contracts. Late payments should be categorized as a negative audit finding by the general auditor for the government departments to change.

The study recommended that;
• Government departments need to work together to promote the development of SME contractors;
• Information designed to assist the development of SME contractors must be centrally published so that it reaches the majority of SME contractors;
• Government needs to ensure institutions established to assist with financing of SME contractors are accessible and assessment procedures to acquire funding are not bureaucratically burdensome; • SME owners should take advantage of training courses offered by private and government institutions if they truly seek to improve the performance of their businesses; and lastly,
• SME contractors must improve their research capabilities to identify opportunities designed to promote SME growth.

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Item Type: USQ Project
Item Status: Live Archive
Faculty/School / Institute/Centre: Historic - Faculty of Health, Engineering and Sciences - School of Civil Engineering and Surveying (1 Jul 2013 - 31 Dec 2021)
Supervisors: Elks, Gary
Qualification: Bachelor of Engineering (Honours) (Civil)
Date Deposited: 16 Aug 2021 05:56
Last Modified: 26 Jun 2023 04:14
Uncontrolled Keywords: Small medium Enterprise, Development, Contractors, Capital, Information, Bankruptcy

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