| dc.description.abstract | The development and sustainability of small and medium enterprises (SMEs) is a priority of the South African government since SMEs contribute significantly to economic growth and employment opportunities. Subsequently, SMEs assist in the alleviation of unemployment, poverty, and inequality thus contributing towards the achievement of the objectives of the democratic developmental state. The government has, through the establishment of the Department of Small Business Development (DSBD), as well as the strengthening of the Small Enterprise Development Agency (SEDA) and the Small Enterprise Finance Agency (SEFA), placed legislation, policies and mechanisms in place to promote the development and sustainability of SMEs. However, the high failure rate of SMEs (70 - 80%) reveals that the current legislation, policies and mechanisms are not successful in ensuring the development and sustainability of SMEs (Lekhanya, 2015:1). Therefore, it hinders socio-economic growth and fails to contribute to the attainment of the objectives of the democratic developmental state. Hence, it is necessary that the government, through the DSBD, provide improved support to SMEs to develop and become sustainable. The study was therefore guided by the following research question: How can the DSBD improve its role in the development and sustainability of SMEs to contribute to the attainment of the objectives of the democratic development state? A theoretical framework for the development and sustainability of SMEs was established which included a review of suitable theories for economic development. An overview of the statutory and regulatory framework for the development and sustainability of SMEs was included in the study. Particular attention was paid to the statutory and regulatory guidelines pertaining to the role of the DSBD in this regard. The study followed a qualitative research approach, based on a thorough literature review and an empirical investigation, with a case study as the research design. Personal semi-structured interviews were used as data collection instruments. The personal interviews were conducted in Refilwe, Cullinan with the owners of SMEs, and the middle managers at the DSBD, responsible for the development and sustainability of SMEs. The most significant findings of the study included the following: the current policies, programmes and mechanisms that are in place to promote the development and sustainability of SMEs do not create an enabling environment hence the majority of black-owned SMEs fail due to inadequate funding, poor infrastructure, a lack of access to markets, red tape and a lack of business management skills. Middle managers at the DSBD, responsible for the development and sustainability of SMEs, are unaware of the base on which SMEs should be funded. The training provided by the DSBD to SMEs is effective, but the majority of the owners of SMEs are not aware of the services provided by the DSDB, which include training and funding opportunities. The DSBD is not effectively communicating the services it provides to SMEs. Based on the findings of the study and the ensuing recommendations made, it is envisaged that the study will assist the DSBD to improve its role in the development and sustainability of SMEs, which will contribute to the attainment of the objectives of the democratic development state. | en_US |
