Export propensity of SMMEs in South Africa

Abstract

South Africa is faced with economic challenges of a high rate of unemployment and low economic growth, and the South African government have identified that exports are essential to ensure the growth of small, medium and micro-sized enterprises (SMMEs) and the growth of the overall economy. In order to better support SMMEs, policymakers requires an in-depth knowledge and understanding of the factors that affects SMMEs ability or inability to export their products and services (export propensity). The main objective of this study was to investigate the factors that may affect whether the SMMEs are able/unable to export their products and services to the foreign countries. An empirical research was done by means of quantitative research in order to answer the research questions. The researcher looked at various factors that have an effect on SMMEs export propensity in the Johannesburg Metropolitan area. The study showed that management experience, management commitment, marketing capabilities, information capabilities, the willingness of the SMMEs leaders and government support are valid factors that affect export propensity, and the Spearman's rho coefficient show that these factors are all correlated. The regression analysis showed that marketing capabilities, management commitment, government support and government funding have a positive influence on the business turnover for small, medium and micro-sized enterprises in South Africa.