Evaluation of access to finance, market and viability of small and medium-sized enterprises in South Africa
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Author(s)Thabiso MsomiLink to ORCID Index: https://orcid.org/0000-0003-3941-6815
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Odunayo OlarewajuLink to ORCID Index: https://orcid.org/0000-0002-4366-040X
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DOIhttp://dx.doi.org/10.21511/ppm.19(1).2021.24
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Article InfoVolume 19 2021, Issue #1, pp. 281-289
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438 Downloads
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Creative Commons Attribution 4.0 International License
Access to finance and market has been described as a predominant challenge confronting small and medium-sized enterprises (SMEs). Hence, this paper seeks to evaluate access to finance, market access and viability of SMEs. A quantitative research method and a purposive sampling technique were used to select the participants for this study. Respondents from retail, manufacturing, construction and agricultural SMEs operating in Durban, KwaZulu-Natal, were selected to complete the structured questionnaires. 310 questionnaires were returned out of 321 distributed. The study revealed a significant effect of access to finance (absolute value 0.425) and access to market (absolute vale 0.373) on SMEs’ viability with a 5% level of significance. Thus, it was concluded that access to finance uniquely accounted for the larger proportion of the variance in the regression model. Thus, this study suggests that owners of SMEs should pay greater attention to access to finance in running their businesses, and the Government should aid SMEs to market their products and keep their businesses viable. Public loans or the government supported loans should be made available for SMEs with soften requirements in order to stimulate economic growth.
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JEL Classification (Paper profile tab)D22, M20, M41
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References38
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Tables2
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Figures0
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- Table 1. Availability of the following source of finance for SMEs
- Table 2. Output of regression analysis on access to the market and access to finance as predictors of SMEs’ viability
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The impact of COVID-19 on SME profitability: Insights from South Africa
Avika Maharaj ,
Thabiso Sthembiso Msomi
doi: http://dx.doi.org/10.21511/ppm.22(4).2024.34
Problems and Perspectives in Management Volume 22, 2024 Issue #4 pp. 460-469 Views: 56 Downloads: 7 TO CITE АНОТАЦІЯThis study aims to investigate the impact of COVID-19 on SME profitability, performance, and operational efficiency. The data were gathered using a structured questionnaire targeting SMEs affiliated with the Centre for Social Entrepreneurship (CSE), Productivity SA, Johannesburg Chamber of Commerce (JCCI), and Durban Chamber of Commerce and Industry (DCCI). A purposive sampling was utilized, specifically choosing SME owners or senior management representatives. The Krejcie & Morgan formula was used to calculate a suitable sample size of 348, resulting in an 81% response rate with 282 participants successfully completing the questionnaire. The instruments’ dependability was validated by Cronbach’s alpha coefficients of 0.906 and 0.769 for the impact of COVID-19 on SMEs and profitability variables, respectively. The findings indicated that the average effect of COVID-19 on SME was 40.3546, with a standard deviation of 7.61450. The average profitability was 5.4921, with a standard deviation of 1.92297. An analysis using a one-sample t-test revealed that the influence of COVID-19 on SMEs did not show a statistically significant impact (p = 0.156). However, the effect on profitability was statistically significant (p = 0.001). These findings emphasize the diverse consequences of the pandemic on the functioning of SMEs, specifically pointing out considerable decreases in profitability. The study recommends that government agencies and financial institutions increase support for SMEs to help them recover from the profitability challenges brought on by the pandemic. Tailored financial relief programs, accessible credit facilities, and long-term recovery strategies should be implemented to cushion SMEs against future economic shocks.
