Challenges faced by SMMEs operating in the ocean economy in KwaZulu-Natal province: A quantitative study

Abstract

Background: The general state of entrepreneurship reveals that despite the efforts of the South African government to stimulate entrepreneurship through a policy framework, many small, medium and micro-enterprises (SMMEs) remain unsustainable. Small, medium and micro-enterprises in the country continue to experience a high failure rate of almost 70% – 80% within the first 5 years of operation. Policy makers have attempted to advance local economic development through entrepreneurship as a key economic development driver, without success. A significant gap exists in relation to knowledge about and challenges facing SMMEs in the ocean economy. Aim: This study on which this article is based, sought to expand the existing body of knowledge, by examining the challenges faced by SMMEs within the ocean economy in the KwaZulu-Natal province and explore the concept of ocean economy within the South African context. Setting: This study focuses on SMMEs in the KwaZulu-Natal Province. Methods: The study followed a quantitative research design, with self-administered questionnaires being used to collect data from SMMEs in the ocean economy in KwaZulu-Natal province. Results: Findings of the study reveal that SMMEs operating within the ocean economy encounter various challenges that impend them from being successful in conducting business in their specific areas. The findings reveal that SMMEs in the ocean economy are faced with challenges such as stringent government regulation and labour laws, a lack of start-up capital, a lack of managerial experience and skills, insufficient incentives and support to access to finance and competitive business environment. Conclusion: The findings indicate future potential for SMMEs in the ocean economy, based on their ability to grow, overcome challenges and sustain their businesses; however, this may be dependent on the implementation of sustainable economic policy framework. In addressing the challenges facing SMMEs in the ocean economy, continued initiatives should be undertaken to promote increased entrepreneurial and productive activities. Contribution: The study contributes to broadening understanding on the challenges faced by SMMEs within the ocean economy in KwaZulu-Natal Province.

Keywords

• ocean economy
• maritime economy
• smmes
• kwazulu-natal province
• entrepreneurship
• blue economy