"Red door" SMME development strategy: impact study report

OUTPUT TYPE: Research report- client
PUBLICATION YEAR: 2006
TITLE AUTHOR(S): T.Morphet, Y.D.Davids, S.Prosalendis, A.Hadland
KEYWORDS: EMPLOYMENT CREATION, SMALL MEDIUM AND MICRO ENTERPRISES, WESTERN CAPE PROVINCE
Print: HSRC Library: shelf number 4386
HANDLE: 20.500.11910/6268
URI: http://hdl.handle.net/20.500.11910/6268

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Abstract

This HSRC report on the impact of the Red Door intervention begins with an assessment of SMME needs and performances in South Africa set in an international context, incorporates both qualitative and quantitative analyses of the 9 offices in the Western Cape and ends with some recommendations, especially in the light of new national SMME initiatives. The Red Door faces the challenge of dealing with poverty relief whilst at the same time contributing to redress and equity targets. The generation of SMMEs and their progression from the informal to the formal sector of the economy is seen in South Africa as a key instrument of growth. Literature suggests a significant failure of SMME development prior to the inception of Red Door some 2 years ago. We focus in this report on the key distinction between survivalist and opportunity activities. Support for `survivalists? result in one-person businesses of uncertain durability, whereas `opportunity entrepeneurs? are better connected, have better access to capital and are more likely to contribute to job creation and growth. They are, however, much rarer than survivalists and survivalists battle to grow into the formal sector.