Factors that limit the long-term survival and development of micro and survivalist enterprises of a selected informal sector in Durban, KwaZulu-Natal (KZN)
Hutchinson, Maud Victoria
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This study explores the factors that limit the long-term survival and development of micro and survivalist enterprises of a selected informal sector in Durban, KwaZulu-Natal (KZN). Micro and survivalist enterprises play an important role in the South African economy, but despite their significance, several studies have shown that these enterprises fail within their first five years. The high failure rate is partially attributed to lack of support from external sources of support as well as the enterprises’ own internal weaknesses. The study was descriptive, exploratory and quantitative in nature. Questionnaires were used to gather data. The questionnaires were personally distributed at the business sites of the respondents. The respondents consisted of 108 micro and survivalist enterprises of a selected informal sector in Durban, who were selected by means of a non-probability sampling method. The results obtained identified a number of limiting factors for the selected informal enterprises’ long-term survival and development. The limiting factors, that are internal to the businesses, included: poor planning, lack of networking, insufficient business experience, poor pricing knowledge, managerial and business knowledge incompetence and lack of literacy, education and training. Those that are external to the businesses comprised of inadequate knowledge in terms of the institutional and supportive environment. Few respondents knew about financial and non-financial services and access to training and development programmes provided by government, semi-government and other institutions. As a result, recommendations to increase awareness of the different incentives available to micro and survivalist enterprises have been set.