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Opportunities, Challenges and Risks: The South African Business Environment Profiling Opportunities and Challenges of Running Small and Medium-Sized Businesses in the Post-Apartheid Vhembe District of the Limpopo Province of South Africa

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Abstract

This chapter analyses salient opportunities and challenges associated with running Small and Medium-sized Entrepreneurial Ventures (SMEV) in the Vhembe district of the Limpopo province of South Africa. Drawing from the experience of eight Vhembe-based Small and Medium-sized entrepreneurs, the chapter identifies and discusses what is entailed in engaging in and sustaining an SMEV in such a context. While some of the identified opportunities include an SMEV-friendly environment for start-ups, access to business networking and clientele base, a less complex market and cheap running cost, some prominent challenges include limited access to finance, lack of basic infrastructure to harness managerial and technical or entrepreneurial skills required for running SMEs, the non-existence of specific entrepreneurial-government policies, and insecurity emanating from violent attacks and theft within South Africa’s rural setting. Based on the review, the chapter inter alia recommends accelerated efforts in improving rural infrastructures and amenities and providing more SMEV-friendly policies to foster rural development and entrepreneurial engagement. Such efforts not only encourage SMEV start-ups, they also provide opportunities for SMEV developments.

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Notes

  1. 1.

    “Rurality” in the context of this chapter refers to those areas within the South African communities that are without access to ordinary public services, such as water, sanitation, electricity and tarred roads. Such areas are found mostly in the former indigenous homelands created by the former apartheid South African government. The areas are characterised by inferior infrastructure, low-income habitats, poor site conditions, unreliable water availability, and poor access to health facilities. They make up to 33.14% of South Africa’s population.

  2. 2.

    Drawing a working definition of SMEV from the South African literature is a recognition of the fact that definition of SMEV in the literature is context specific. (Going deep into the philosophical debate about the meaning of SMEs in the literature is outside the scope of this study.) Within the literature, there is no one set definition of SMEV that applies globally. Often, each country set its own definition, which includes the specificity on what is considered a big, medium or small-sized enterprise. For example, while the European Union has a limit of 250 employees, the United States still considers an enterprise with up to 1200 employees as an SME (Small Business Administration, 2020; European Commission, 2020).

  3. 3.

    Vhembe is situated in the Northern part of the Limpopo province, which also lies in the Northern part of South Africa. With its headquarters in Thohoyandou, the district is composed of four main local municipalities, namely, Makhado, Musina, Thulamela and Collins Chabane. Uniquely, the Vhembe district is one of the only districts that shares borders with three countries: Zimbabwe to the north, Mozambique through Kruger National Park to the east and Botswana to the northwest. The district covers about 21,407 km2 and has a population of over 1.1 million living in 274,480 households.

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Authors and Affiliations

  1. Centre for Youth and Gender Studies, University of Venda, Thohoyandou, South Africa

    Amaechi Kingsley Ekene & Tambe-Dede Kelly

  2. Department of Business Management, University of Venda, Thohoyandou, South Africa

    Amaechi Kingsley Ekene & Tambe-Dede Kelly

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  1. Amaechi Kingsley Ekene
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  1. Lagos Business School, Pan-Atlantic University, Lekki, Nigeria

    Rose Ogbechie

  2. Lagos Business School, Pan-Atlantic University, Lekki, Nigeria

    Marvel Ogah

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Ekene, A.K., Kelly, TD. (2024). Opportunities, Challenges and Risks: The South African Business Environment Profiling Opportunities and Challenges of Running Small and Medium-Sized Businesses in the Post-Apartheid Vhembe District of the Limpopo Province of South Africa. In: Ogbechie, R., Ogah, M. (eds) Sustainable and Responsible Business in Africa. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-031-35972-9_3

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