Entrepreneurs’ endogenous attributes necessary for small enterprise success in Vhembe rural areas, South Africa

Abstract

Background: Enterprises in South Africa, especially in rural areas, continue to fail, despite the continuous support from government. A key contributing factor is that most enterprises’ support is channelled to exogenous factors without recognising their endogenous predisposition as well. Aim: This article isolated entrepreneurs’ endogenous attributes which if complemented with exogenous support could spur enterprise success. Setting: This study focussed on addressing enterprise failure in rural areas of Vhembe; however, the findings can be applied in other areas in South Africa and beyond. Methods: A sample of 81 participants was drawn using the snowball sampling technique. The qualitative data gathered from this sample using a semi-structured questionnaire were then analysed through Atlas-ti v8 from which 49 items were isolated. This informed a quantitative component that entailed the development of a 5-point Likert scale for data collection in the second phase of the study, where, subsequently, 280 respondents were engaged. The Principal Component Analysis was used to reduce the data dimension of 49 items to five principal components which accounted for 68.794% of the total variance. Results: The five principal components isolated were bridging-networks (38.044), self-belief (15.802), risk-awareness (6.144), resilience (4.532) and non-conforming (4.271). Further analysis was performed on data collected from 83 participants who met the 50% performance threshold using the linear regression. Bridging-network is the most important endogenous success factor in the study area, followed by nonnon-conformist risk-awareness, resilience and self-belief. Conclusion: Results conform to grassroots realities, thus, a framework anchored on this was developed to support enterprises grassroots enterprises.

Keywords

• endogenous attributes
• enterprise failure
• rural area
• success factors
• grassroots realities.