Customer ’ s perception towards product quality of automotive SMEs operating in Metropolitan areas , and consideration of environmental impact

This paper examines customer’s perception towards product quality of automotive SMEs operating in the Durban metropolitan areas and identifies how small and medium enterprises (SMEs) in South Africa (SA) contribute significantly to job creation, wealth, social stability, economic growth and reduction of poverty. Product quality of automotive SMEs requires serious attention, as it can have ecological environmental impact leading to the negative economic growth contributed by the industry. The study is aimed to understand the factors affecting automotive SMEs in order to help entrepreneurs to improve product quality and examining the customer’s perception towards product quality. The sample size of the study was 120 SMEs selected using convenience sampling with respondents completing the questionnaire. A combined method of both quantitative and qualitative techniques was employed, while the analysis of data was done using the Statistics Package for Social Scientists (SPSS) version 23.0. The findings of the study revealed that lack of managerial skills and development negatively compromises product quality of the automotive sector. Also the results indicate that the absence of financial support from financial institutions delays the improvement of stock in the business, as this is an obstacle resulting in the unsustainability of the SMEs. Further research with larger samples and the consideration of other cities is recommended.


Introduction 
Small and medium enterprises are the engine of any country's economic development and they play a vital role for providing employment opportunities (Marnewick, 2014, p. 1).However, the Republic of South Africa and Ghana are the most successful countries in Africa, which play a significant role in economic growth development in the SMEs (Olawale and Garwe, 2010, p. 729).Therefore, it is noted that Ghana has established 92% of businesses and created 85% of job opportunities for the people of Ghana and also contributed 70% to the Gross Domestic Product (GDP), whereas the Republic of South Africa has established 91% of businesses and created 61% of job opportunities for the people of South Africa and also contributed 52%57% to the GDP (Abor and Quartey, 2010, p. 218).
However, the SMEs believed supplying the word-ofmouth in order to examine the customer's perception towards product quality and it has become a great influence on examining customer's products (Doh and Hwang, 2009, p. 193).Furthermore, Moslehpour, Aulia and Masarie (2015, p. 67) concluded that This is an Open Access article, distributed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International license, which permits re-use, distribution, and reproduction, provided the materials aren't used for commercial purposes and the original work is properly cited.customer satisfaction is the core key challenge to the SMEs, because customers are very sensitive when it comes to product quality and price.The price of a product is playing a very important role in the customers' perceptions.Lamb, Hair, McDaniel, Boshoff, and Terblanche (2008, p. 76) added that customers are using five senses (sight, smell, taste, touch and hearing) to describe a product.Therefore, the overall aim of the study was to explore the factors influencing customer's perceptions toward product quality of automotive SMEs operating in Durban metropolitan areas.This overall aim is guided by the following research objectives:  to examine the customer's perceptions towards products quality of automotive SME's operating in the Durban metropolitan areas;  to identify and discuss factors affecting automotive SME's operating in the Durban metropolitan areas.

SMEs and Durban metropolitan definition.
There is indeed a need to clarify the definitions of the following terms, which are found in the body of the study, which is small enterprise and medium enterprise.The definitions will be dependent on the countries, regions and economic sector.Perception is defined as a broad imagination that people create in their mind and interpret that imagination as a bigger meaningful picture (Raji and Zainal, 2016, p. 59).However, customer creates an image of that product based on the value of the product.Sometimes they say the value is low price; value is whatever customers want in a product; value is the quality customers get at the price paid, and value is what customer gets for what they give.Therefore, Amin, Falk, and Schhmitt (2014, p. 391) state that the customer perception has been generated at the first impression about the product, however, the customers form a judgement about the value of a product immediately before purchasing.In addition, the customer perception is prejudiced by the experience already received with the similar product.Hence, Rani (2014, p. 52) agrees that judgement is a process like buying behavior whereby customers try to understand the product and scrutinize it up until getting on the right track or making a decision to buy or not to buy.

Automotive SMEs sector in South Africa.
SMEs are of fundamental importance to many economies, although South Africa has been described as a country where poverty is high.In this regard, literature states that the SME is the key engine of economic development and creates almost half of the jobs in the economy.However, South Africa is characterized by poverty and unemployment rates.It is noted in a previous study that South Africa lagged behind other developing countries in economic development.Manyaka (2015, p. 3) adds that behind an SME, there is an entrepreneur, who has a desire to accept responsibility for solving a problem, setting goals and reaching goals through their own efforts, desire to apply his knowledge of skills in his business and a desire to have an outcome for the decision he made.Automotive SME in this study is a sector that sells vehicle parts or components to the customers of the Durban metropolitan area.A car part is the smallest removable item on a car, whereas a component is a term frequently used when referring to an electrical or electronic part.The aim of the automotive SMEs in this car production is to fulfil the requirements of the customer such as short delivery, low cost and quality product (Ryu, Shin, Lee and Choi, 2008, p. 253).

Importance of medium communication in the
SMEs.Social media plays a very big role in the SMEs, whether it is negative or positive, it impacts on the customers of the SMEs.Duffett and Wakeham (2015, p. 20) state that the spreading of social media to the people of South Africa is increasing, although it is not more than a decade old.They continue by revealing that social media has increased from 10% in 2010 and 35% in 2012.Rudansky-Kloppers (2014, p. 1187) argues that the social media has benefited only 30% in 2012, and South Africa is sitting on 14 million users.It was about 25% in 2010 and is sitting on 8.5 million people of South Africa, who fully engage themselves on social media.The media communication is very useful, more especially, to the marketers of the SMEs, because when marketing on media communication, the message quickly reaches the customers.
Marketing communication enables social media to generate the sales in order to survive in their SMEs.Most people are relying on medium communication and expect that media will give exactly what they are expected to see and feel.Sometimes social media create an attitude in other customers for using an inferior brand rather than using a superior brand in terms of cost effectivity (Schinski and Dabrowski, 2013).However, social media apparently give the customer the opportunity to degrade the product of other competitors in the market.An interaction of customers over social media is affecting customer buying behavior and their choice of automotive SMEs.

Importance of automotive SMEs in South
Africa.Industry Policy Action Plan (IPAP) of 2007/2008 indicated that automotive sector is playing an important role in the economy of South Africa; this sector contributes almost 7% to the GDP of South Africa.
Sithole (2015, p. 13) and Marnewick (2014, p. 1) revealed that the mission of the development of SMEs in South Africa is to play an incredible role in sustainable poverty reduction, economic growth and massive job creation within the community of South Africa.Therefore, automotive SME's role in this study is to supply motor parts to their customers, because they supply them for a cheaper price than the dealership.Rose, Deros, Rahman, and Nordin (2011, p. 872) state that the development of automotive SMEs is considered as a strategic weapon in a competitive market with an increasing demand for quality products.Withers, Garza-Reyes, Kumar, and Rocha-Lona (2013, p.134) support the fact that the competitive market has been increased not only due to large companies, but also automotive SMEs are leading in a competitive market, which facilitates the improvement of operations and the shaping of product quality as a platform of the business.
SMEs in South Africa are the building blocks of an economy, whereby SMEs contribute 61% to the country's employment statistics (Khan, 2014).However, Mayatra, Chauham, Trivedi, and Qureshi (2016, p. 1) illustrate that development of automotive SMEs that will manufacture small components like auto parts is saving much time, and the economy is rapidly growing at the same time.Deros, Yusof, and Salleh (2006, p. 399) continue support that automotive SMEs have beautiful characteristics, because they supply components to the larger companies at the cheapest price, their communication is very fast, decision-making process is quick and implementation is fast.
1.6.Product quality.The product quality is considered as one of the factors that, as an effect, stimulate the customer perception.Sarwar, Azam, Haque, Sleman, and Nikhashemi (2013) state that the buying power of the Chinese product is growing rapidly throughout the entire world, although some customers are not buying Chinese products because of quality issues.The product quality is the key issue for the customers -they believe in purchasing a product that will last long.The product quality must always exceed the customer's expectation, because the standard of an enterprise is determined by the customer who has experienced that product and uses that experience and feeling to form a judgement against business (Abdullah and Rozario, 2009).Tsele and Tulo (2015) believe in supplying good products to the customers and also believe that if the customers trust the product quality, they will be loyal to that product even when tough times (recession) come.They will always stand up for that product, because it good and reliable.1.7.Price offer.Customers believe using price as a measurement or indicator of product quality (Agyekum, Haifeng, and Agyeiwaa, 2015, p. 25).Price is a marketing communication tool that conveys a message to the customers for the product and influence to speed up decision making process (Erdil, 2015).However, price transparency should lead directly to price fairness perceptions, which, in turn, have significant impacts on satisfaction.Therefore, it is important to build the customer loyalty toward the product, because the customer will repeat purchasing the product with any price offered on the table (Spence and Essoussi, 2008).

Place (country of origin).
Developed countries prefer to buy their own products, which they still continue exercising ethnocentrism and they also believe that country's image is playing an important role to the consumers (Jahanshabi, Gashti, Mirdamadi, Nawaser, and Khaksar, 2011).Frank,Torrico, Enkawa, and Schvaneveldt (2014) have confidence in that investment in product quality because of its pay off in a long term to the developed countries.They further elaborate that consumers do often assume that the developed country products are of better quality than the product from developing countries.1.9.Promotion.Promotion is playing a vital role in any developed or developing country, because promotion is one of the driving components for economic growth.Promotion is a wakeup call or booster of the consumers to keep recognizing the product that is still available in the market with additional features and it performs better than before with a high performance standard, this is a way of selling the business.Therefore, there is a relationship between product quality, price, place and promotion in this study.The study reveals that promotion is a factor that influences the customers' perception (Singh, 2012).Promotion consists of different blends of its components which are used to achieve the business' marketing goal.Bouazza, Ardjouman, and Abada (2015, pp.101-103) establish that poor managerial skills is a very sensitive and serious factor in the SMEs; it will affect the product quality with the result that the external factor will intervene in this situation.However, external factors like financial institution will not assist the SMEs in terms of performance that resulted through poor managerial skills.Quality management practice is an overall remedy that will deliver the best product quality to the SMEs customers (Dash and Tripathy, 2016, p. 14).
1.12.Lack of financial support.Globally, SMEs are regarded as an economic development sector, creator of an employment platform, and finally, a fighter for poverty.However, various studies indicated that formal SMEs have contributed almost 45% to total employment and 33% to the Gross Domestic Product.Therefore, SMEs are less likely to be able to secure a bank loan than large enterprises.Instead, they rely on their personal funds.Fauad (2013) reveals that more than 50% of the SMEs are facing a problem of getting financial support from financial institutions in order to improve their SME's development.However, this limitation of financial support leads to the decline of the SMEs in most cases.Mbawuni and Nimako (2015, p. 63) add that it is difficult to give new SMEs external finance, because most SMEs easily fail within a short period of time in a business and, then, the business will not return any profit.Veerappan and Sathishkumar (2016) report that profit is the measure of success of fruitful SMEs, and it is regarded an essential product of the business.
1.13.Poor planning, organizing, leading and controlling.Entrepreneurship is about developing a business from scratch, while managing scarce resources such as time, money, etc.Therefore, it is better to plan, organize, lead and control as much as possible with limited resources.Entrepreneurs fail to plan because of their ignorance and lack of vision about their business.Lekhanya (2010, p. 39) states that SMEs fail when they were still at the starting stage simply because of poor planning in estimating a cost of starting and running the SME.Khan, Khan, and Khan (2011) state that training given to staff will yield a good performance on their SMEs, and the product will perform well in the market.Training is an important factor that gives the SME a good platform, as all SMEs are willing to achieve a goal through properly planning, organizing, leading and controlling.Gibbert, Leibold, and Probst (2002, p. 459) support that knowledge is a key competitive factor both locally and globally by organizing the employees to be a powerful body in the SMEs by having the training to know how to deal with Customer Knowledge Management (CKM).Employees must have the ability to know how to screen the customers about how they feel about a product offered by their SMEs.As mentioned by Vallabh, Radder, and Venter (2015), the creation of the SME is to meet customer needs and, if needs are met, the customers' perception will start to be established.

Research methodology
Both qualitative and quantitative methods were used for data collection.However, the questionnaires were containing both closed-ended and open-ended questions and dispensed to the 120 SMEs owners/managers.

Target population.
The target population of this study was SMEs located around Durban metropolitan areas, as this was the target population in this study.

Sampling.
Convenience sampling has been applied in this study, because populations were easily available to the researcher and the non-probability technique was used, because it is cheaper than probability sampling and can be implemented more quickly (Leiner, 2014, p. 4).Therefore, in this study, the researcher selected Durban metropolitan areas, which include Durban North, Durban South and Durban Central, where questionnaires were distributed to the automotive SMEs.

Measurement instrument.
The measuring instrument in this research was a questionnaire composed together with a closed-ended question and opened-ended question, five (5) point Likert scale rating.The respondents were also given enough blank lines to elaborate their answers to the question asked in their questionnaire to give supplementary information.
The questionnaire was compiled based on the research objectives of the study.The findings of the study clear emphasize that 45.9% respondents agree that poor product influences bad economic growth in the environment and also impacts health risk to the society.Even though the automotive is very competitive, many excellent management practices are already in use in the industry.It is noticeable that an ecological effect in this study is an effect that influences the bad environment in the living society of Durban metropolitan areas.However, the adoption of an informal automotive SME is the main obstacle to the sustainable economic growth in the City of Durban.Therefore, the business environment has changed over the past few years.However, Naude (2013, p. 408) also confirms that the automotive company is under severe pressure and faces many supply-chain problems that are a result of rapid developments in supply-chain management, technology advancements, high labor cost, poor infrastructure, globalization and increasingly demanding customers who are squeezing their suppliers on price and non-price factors.The above problems also disturb the growth of the economic environment within the country.

Fig. 1. Gender of participants
Figure 1 shows that 94.3 percent of the respondents were male and 55.7 percent were female.Overall, the ratio of males to females is approximately 9:1 (94.3%: 5.7%).However, the df =1 and p = .000and this implies that there is a significant difference in the gender.Therefore, the hypothesis on this variable is accepted.

Fig. 2. Age of participants
Figure 2 shows that the lowest number of 1 (1.1 percent) of the participants was less than 19 years old, while 12 (13.8percent) were from 20-29 years.
Participants between the ages of 30-39 were 36 (41.4 percent) of respondents, while participants between age of 40-49 were 26 (29.9 percent), then, the respondents between the age of 50-59 were 8 (9.2 percent) and age of 60 or more were 4 (4.6 percentage).The participants at the age of 30-39 were the most keen to participate in the study, and this shows the positive changes moving forward in the automotive industry in the Durban metropolitan area.However, the df = 5 and p = .000implies that there is a significant difference in the age grouping.Therefore, the hypothesis on this variable is accepted.

Fig. 3. Race group of participants
Figure 3 shows that 8 (9.2 percent) the participants were African, while 15 (17.2 percent) were White group participants.The highest number was Indian participants who contributed 61 (70.1 percent), followed by 3 (3.4percent), which were Coloured participants.The Chi square test is used.However, the df =3 and p = .000and this implies that there is a significant difference in the race grouping.Therefore, the hypothesis on this variable is accepted.

Fig. 4. Level of education of participants
Figure 4 above determines that 42 participants (48.3 percent) were in possession of Matric, followed by 20 (23 percent) who had a Diploma.Furthermore, 4 (4.6 percent) were in the possession of Honour's Degrees followed by 2 (2.3 percent) who had a Master's Degree.Those in possession of any qualification not listed above (Other) were 19 (21.8 percent).The Chi square test is used.Meanwhile, the df = 4 and p = .000,however, this implies that the distribution by qualification is not similar.Therefore, the hypothesis on this variable is accepted.percent) of the respondents just agreed, while 13 (14.9)disagreed and 6 (6.9 percent) strongly disagreed.However, the df = 4 and p = .000)finding shows a significant relationship between the variables.Therefore, the hypothesis on this variable is accepted.perception puts more pressure on the competition.Meanwhile, 30 (34.5 percent) strongly agreed with this statement, 12 (13.8percent) of the respondents were neutral, while 6 (6.9 percent) disagreed and 4 (4.6 percent) strongly disagreed.However, the df = 4 and p = .000.Therefore, the hypothesis on this variable is accepted.Meanwhile, 29 (33.3 percent) strongly agreed with this statement, 16 (18.4percent) of the respondents were neutral, while 4 (4.6)strongly disagreed and 3 (3.4percent) disagreed.However, the df = 4 and p = .000)finding shows a significant relationship between the variables.Therefore, the hypothesis on this variable is accepted.

Fig. 8. Respondent's perception of influence religions
Figure 8 indicates that the majority of respondents 26 (29.9 percent) were neutral regarding the statement that the customer's perception can promote certain religions to benefit in a business.Meanwhile, 20 (23 percent) strongly agreed with this statement, 14 (16.1 percent) of the respondents strongly agreed, while 14 (16.1)strongly disagreed and 12 (13.8percent) just disagreed.However, the df = 4 and p = .102finding shows no significant relationship between the of variables.Therefore, the hypothesis in this variable is not accepted.It is evident that, with 11 (12.6 percent) of respondents indicating their ability to get good customer service, this is the factor that has encouraged them to keep buying the product.A total of 9 (10.3 percent) of respondents showed that customer brand is good for the business, while 6 (6.9 percent) of respondents showed that customer satisfaction is good and 4 (4.04 percent) showed that the customers are willing to buy quality stock.The results show 11 (  The findings on this statement indicated that 34 (39.1 percent) the respondents indicated 'yes' that they will involve the customers in new product planning.However, 21 (24.1 percent) respondents indicated 'No' and 2 (2.3 percent) respondents did 'Not often' involve customers in new product planning.The findings show that 7 (8 percent) the respondents indicated that to budget properly will avoid financial crises in SMEs.However, 2 (2.3 percent) respondents indicated that the SMEs must exercise stock control , while 5 (6.9 percent) indicated that SMEs must avoid overstocking and 5 (5.7 percent) indicated that the SMEs must accurately plan for the future.The findings revealed that 32 (36 percent) respondents indicated 'no' that they do not have customer care service hot-line and 27 (31 percent) respondents indicated 'yes' they do have customer care service hot-line.The reveal that 11 (17.1 percent) respondents indicated that their businesses donate brankets and clothes to poor people.Meanwhile, 6 (8 percent) respondents indicated that they provide a feeding scheme for the community, while 2 (2.3 percent) indicated that they offer bussaries to university students and 3 (3.4percent) respondents are not doing anything for the community.

Conclusions
The response rate of the study was 73%.Cronbach's alpha was used to measure the inter-item consistency and to determine the normality of the data.The empirical findings on demographic variables were presented using figures, tables and charts.An important factor to note is the significant number of similarities in responses from participants.The findings also revealed that there is a significant positive relationship between objectives.Pearson correlation was used to determine the relationship between the questions.

Recommendations for SMEs
It has been indicated that the poor product quality is a result of the lack of managerial skills, and it puts more emphasiz on the perceptions of the customers against the product quality (Abdulai, 2014).However, Erol (2015, p. 123) considers that it is the poor service delivery to the customers that causes a big dent because of lack of skilled staff within the SMEs.Therefore, the findings of this study again indicated that 93% of the SMEs failed to survive because of constraints of the financial support from financial institutions to boost their SMEs (Makina, Fanta, Mutsonziwa, Khumalo, and Maposa 2015, p. 5).Marnewick (2014) agrees and concludes with the findings that the SMEs managers don't offer training to the staff in respect of getting to know about the features for the product.However, the findings of this study do not strongly suggest the same issues.Therefore, based on this comparison, the study concludes that all objectives were achieved and found to be realistic.

Recommendations for further study
The study recommends further research on the progress of implementation strategies that can be employed to improve automotive SMEs in the Durban metropolitan areas.


Lawrence Mpele Lekhanya, Henry Lucky Dlamini, 2017.Lawrence Mpele Lekhanya, Department of Public management & Economics, Durban University of Technology, South Africa.Henry Lucky Dlamini, Department of Entrepreneurial Studies and Management, Durban University of Technology, South Africa.

1. 10 .
Internal factors.In this study, there are a number of factors that affect the performance of small and medium enterprise in the automotive sector of Durban in South Africa.However, those numbers of internal factors contribute to the failure of the automotive SMEs.It is noted and acknowledged that the SMEs are the backbone of most economies and are a key source of economic development of any country.Kambwale, Chisoro, and Karodia (2015) highlighted the fact that there are some significant factors that contribute to the SMEs to decline.1.11.Poor managerial skills.Skill and knowledge belong to important factors of production, upon which SMEs development is currently formatted and, as a result, stimulates economic development in the developing country(Papulova and Mokros, 2007).

Fig. 5 .'s perception on product can solve the problem of dissatisfactionFigure 5
Fig. 5. Respondent's perception on product can solve the problem of dissatisfactionFigure5indicates that the majority of respondents 27 (31 percent) were neutral that the customer's perception can solve the problem of dissatisfaction with a product.Meanwhile, 21 (24.1 percent) strongly agreed with this statement, 19 (21.8 percent) of the respondents just agreed, while 13 (14.9)disagreed and 6 (6.9 percent) strongly disagreed.However, the df = 4 and p = .000)finding shows a significant relationship between the variables.Therefore, the hypothesis on this variable is accepted.

Fig. 6 .Figure 6
Fig. 6.Respondent's perception on competition can put more pressure Figure 6 indicates that the majority of respondents 34 (39.1 percent) agreed that the customer's

Fig. 7 .'s perception can drive the automotive business to become successfulFigure 7
Fig. 7. Respondent's perception can drive the automotivebusiness to become successfulFigure 7  indicates that the majority of respondents 34 (39.1 percent) agreed that the customer's perception can drive automotive business to become successful.Meanwhile, 29 (33.3 percent) strongly agreed with this statement, 16 (18.4percent) of the respondents were neutral, while 4 (4.6)strongly disagreed and 3 (3.4percent) disagreed.However, the df = 4 and p = .000)finding shows a significant relationship between the variables.Therefore, the hypothesis on this variable is accepted.

Fig. 9 .
Fig. 9. Respondents about customer 's perception towardsproduct quality in you business?

Fig. 11 .
Fig. 11.Respondents abkout customer involvement in a new product planning.

Fig. 12 .
Fig. 12.What advice do you give other SMEs to avoid from financial crisis?

Fig. 13 .
Fig. 13.Does your business have a customer care service hot-line?

Fig. 14 .
Fig. 14.Give any view on how your business engagesin community outreach?
Some authors looked at the size, turnover level, number of employees and GDP contribution among firms.However, if the contribution to the GDP is small, it's regarded as a small firm, but if the contribution is big it is regarded as a large firm.Nevertheless,Abor and Abor and Quartey (2010)support the above statement that the industrialized countries and developing countries have given a different definition of the small and medium enterprise.The SMEs definition is a major concern in the literature because many authors have given different definitions.However, the term "Durban" is simply defined as a coastal metropolitan area, which is situated on the east coast of South Africa in the Province of KwaZulu Natal(Breetzke, 2009, p. 3).After Johannesburg, Durban is the second biggest city within South Africa.Therefore, the eThekwini Municipality Integrated Development Plan (2012/2013 to 2016/2017) indicated that Durban has an extremely large population size, which has grown by an average of 1.13% p.a. Statistics South Africa (2014, p. 20) states that the Durban population will be estimated at 3.

Table 1 .
Summary of Likert scale

Table 2 .
Provincial distribution in 2015 Source: The Small Enterprise Development Agents (2016).

Table 3 .
Empirical finding/result for this study in 2016