Abstract
M.B.A.
Gauteng, the smallest of the nine South African provinces, but the largest in
terms of its contribution to national GDP (33.9%), generates 10% of Africa’s
GDP (Gauteng Enterprise Propeller Overview, 2007) and is therefore a very
important geo-economical zone.
As South Africa latest unemployment rate is 25.5% (StatsSA, 2006),
Government is geared towards promoting small businesses in an effort to grow
the economy and reduce unemployment. It is therefore very important to the
economy that small businesses succeed, grow and provide employment.
Due to the fact that at present, very little research into the success factors
amongst small businesses in South Africa has been conducted in South Africa,
it seems appropriate at this time to investigate the success factors of small
businesses in Gauteng.
The problem statement in this research is that there is insufficient knowledge
relating to the factors contributing to the failure or success of small businesses
in South Africa, Gauteng.
To conduct this research, a qualitative and exploratory approach was decided
upon. A literature survey on the subject was conducted in order to ground the
current research in existing theory and research. A questionnaire was sent out
by e-mail to 3776 businesses in Gauteng, to which the response rate was
3.15% (119 questionnaires were returned). The questionnaire was divided into
sections and covered the definition of success, entrepreneurial personality
characteristics of owner/manager, use of management tools, resource
availability and the classification of respondents and their businesses.
Due to the small size of the sample this research is not able to conclusively
achieve the primary research objective of identifying the success factors of
small businesses in Gauteng, but it has nevertheless contributed to the body of
research on the matter, since it established that there is a correlation between:
• Entrepreneurial personality and the success of small businesses
• The use of management tools and the success of small businesses
• The availability of resources and the success of small businesses.
In addition the following can be reported:
• The owner/managers surveyed attributed their success to:
- persistence and determination
- experience
- entrepreneurial personality
- business knowledge
- a great team
- education
• The existence and or use of the business plan and its relationship to
success remains inconclusive
• Financial resources do not feature prominently as a success factor, but
business skills do seem to correlate with success.
Further research is necessary to pinpoint conclusively which traits and
behaviours are conducive to success, by comparing successful and
unsuccessful business owners.
Other recommendations that arose from this research were:
• Research should be conducted into the assumption that economic
growth is driven by the proliferation of small businesses
• Research into the weight of internal factors ((personality, experience,
attitude, knowledge) versus that of external factors (start-up capital,
business plans, skill availability, economic and legal conditions) would
contribute to the body of knowledge and could trigger a shift in approach.