The reasons that may prevent small and medium-sized enterprises from being successful

Abstract

This document addresses the reasons that may prevent small and medium-sized enterprises (SMEs) from being successful. Chapter 1 is about the aim of the study and the definition of the small and medium-sized enterprises. Chapter 2 is identifying the impact of small and medium-sized enterprises in the country's economy and the rate of failure in this business sector. It also looks at the role of government and banks to these businesses and the reasons that may prompt individuals to go into this business sector. Chapter 3 is about literature study which has been undertaken to identify reasons that cause small and medium-sized enterprises to fail, and the variables constraining internal growth. Chapter 4 is about the empirical research which complements the literature study in Chapter 3. This is done in order to verify if the reasons found in previous studies are still relevant for the current situation. Twenty black business managers, in Soweto, were interviewed. The findings suggest that the basic causes of business failure remain the same irrespective of location. The managers tend to lack management ability and they also suffer from inadequate capital to grow their businesses. A proposal has been made, in Chapter 5, for an education curriculum to incorporate the basics of running a business at the early stages of learning. Apparently the majority of people who leave school at very early stages resort to starting their own businesses as they may not find jobs in corporate businesses or the Government sector.