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Document: Xhariep SMME Development and Support Plan
Description
The Small Enterprise Development Agency (seda) Research Unit has been conducting research in partnership with various district municipalities, with the intention to assist seda and district municipalities in identifying the size and the scope of SMMEs operating within these districts. One of the districts seda has assisted is the Xhariep district, situated in the Free State Province. Apart from the Xhariep study, seda has also conducted and published several district studies, including UMgungundlovu, Amatole, Overburg, Eden and Ehlanzeni.
Having completed a study of the SMMEs in the Xhariep district, the study will serve as a basis for a plan of action to assist in establishing and growing SMMEs in the Xhariep district. This study seeks to provide information on the needs, opportunities as well as challenges facing small enterprises in the Xhariep district. It gives a better platform upon which support can be provided, including the design of needs-based services tailored made for this district economy. That would make sedas service to SMMEs relevant as they are demanddriven and responsive to actual needs on the ground.
It is widely accepted that small and mediumsized enterprises play a central role in developing countries socially and economically, in terms of job creation, poverty alleviation and economic growth. South Africa has, since 1994, been facing challenges of re-integration into global markets as a global economy. In response to these challenges, the government has since initiated policies that focus on the promotion and development of small businesses to address the challenges of job creation, poverty alleviation and economic growth.
It is of interest to seda to note that in South Africa, the SMME sector has absorbed nearly 57% of the people previously employed in the private sector, and contributed 42% of the countrys GDP. Its a well-known fact that the SMME sector has developed the largest group of employers, and generated the most jobs in recent years. Small and medium-sized businesses are key players in product distribution and retailing for larger organizations in South Africa.
In addition, it is worthy to note that this research study has clearly identified trends and challenges facing the SMMEs within this area. The constraints facing small enterprises in the Xhariep district are not different from other districts in general. These include lack of finance, business skills, cost of labour and managerial skills. In responding to these issues, seda would seek as much as is practically possible, to provide needs-based solutions to the SMMEs of this district municipality. This will be done in partnership with relevant stakeholders including the district municipality.
As mentioned above, the support for small and micro business is a shared responsibility between government, both on national and local level and NGOs. The RDP, GEAR and ASGI-SA programs were implemented in 2006 and hoped to promote growth and continued success of the SMME sector. The following support organizations are available for all the SMMEs, DTI, Khula Finance Limited, SEDA and commercial banks.
Re: Xhariep SMME Development and Support Plan
Seda is doing good in assisting in the establishment of and supporting of SMME's, but the continuous support needs to be improved. Partnerships formed between SMME's and Service Providers / Potential Funders must be monitored; and not only the succes stories.