Information asymmetry and obstacles on SMMEs growth in the rural Areas of uThungulu district municipality of KwaZulu-Natal
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Date
2012
Authors
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Journal ISSN
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Publisher
University of Zululand
Abstract
Information asymmetry is regarded as factors that affect SMMEs and issues
hindering SMMEs growth which include management skills, market access and
lack of training. This is supported by Rogerson (2008) that several challenges
facing SMMEs development in South Africa have been unapproachable. Number
of factors have been identified which relate to markets access and marketing,
business management skills, training, finance and inadequate institutional support.
The SMME sector is regarded as a potential employment creator and contributes
significantly to the economic growth of South Africa. SMMEs have the major
share of the development and almost half of the total employment in the economy.
While argument still exists about the comparative contribution of SMMEs to the
economy, this sector contributes a massive share of employment which contributes
significantly in the economy. However, SMMEs are facing challenges that prevent
them from growing, and causing a large percentage of SMMEs to shut down in
their first two years of operation.
This study aims to discover the information asymmetry and obstacles on SMMEs
growth in uThungulu district municipality. An investigation was conducted among
owners in all local SMMEs in the district to identify obstacles perceived as central
to SMMEs growth. Structured questionnaires were used to collect data. The
research findings indicate that lack of training and management skills are one of
the challenges faced by SMMEs since the majority of entrepreneurs have only
matric qualifications. The use of technology was also identified as an obstacle on
SMMEs growth.
Description
A Dissertation submitted in fulfillment of the requirements for the degree of Master of
Commerce in the Department of Business Management in the Faculty of Commerce,
Administration & Law at the University of Zululand, South Africa, 2012.
Keywords
Information Asymmetry, SMME