Small and Meduim Sized Enterprises

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SMEs (small and medium –sized enterprises) are increasingly becoming one the most important enterprises with the most significant change in the economic situation of many countries. Government has since realised the importance of such business and started developing the SME sector. SMEs have reached a 7 percent growth rate and account for approximately 40 percent of the GDP (Gross Domestic Product). There are about 40 000 entrants every year. SMEs account for 60-70 percent of most jobs but are also confronted with challenges in the industry such as limited access to bank credit.
Small and medium-sized enterprises (SMEs) are a very diverse group. These are found in a wide disposition of business activities ranging from the shop down the road to businesses in well-established areas. The individuals owning these enterprises may or may not be poor; the firms operate in very different markets (urban, rural, local, national, regional and international); embody different levels of skills, capital, sophistication and growth orientation, and may be in the formal or the informal economy.
Statistically, in South Africa, SMEs are defined according to the number of employees, value of sales and/ or value of assets. There are five key areas namely: survivalist enterprise, micro enterprise, very small, small enterprise and medium enterprise. Survivalist enterprise is one where the generated income is less than the minimum wage permitted by law. These are normally categorised under the micro-enterprise sector. An example for this can be street vendors. Mic...

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...gency, State of small business development in South Africa annual review. (2002)
OECD. (2004, 3-5 June).PROMOTING ENTERPRENEURSHIP AND INNOVATIVE SMEs IN A GLOBAL ECONOMY: Towards a more responsible and inclusive globalisation. 2ND OECD CONFERENCE of Ministers responsible for small and medium-sized enterprises (SMEs), Istanbul, Turkey.
SEDA. (2013). Final Report of Analysis of the Needs, State and Performance of Small and Medium Businesses in the Agriculture, Manufacturing, ICT and Tourism Sectors in South Africa (pp. 1-107).
Statssa. Manufacturing industry, 2008. (2009) Statistical Release P3002, 10 December 2009).
Wiid, J., & Cant, M. (2013). Establishing the challenges affecting South African SMEs. International Business & Economics Research Journal, Vol.12 (6), pp. 707-716. 1 March 2014, from http://journals.cluteonline.com/index.php/IBER/article/view/7869/7928

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