Abstract:
This study aimed to investigate the impact of business incubators on the growth of small, medium, and micro-enterprises (SMMEs) in South African townships, with a focus on Gauteng. The study reviewed social capital and institutional theories. Furthermore, a review of the empirical literature revealed that SMMEs receive various services and support from business incubators, including coaching and mentoring, training services, infrastructure support and financial support. The study chose the qualitative research approach, interpretivism philosophy and exploratory research design. A non-probability sampling strategy was used, and a quota sampling technique was adopted. The data were collected using an interview guide with open-ended questions. The target population of this study was all the owners and managers of SMMEs operating in the townships of Tshwane Municipality registered under the SEDFA. The sample of this study consisted of 20 SMMEs in the retail and services industries. The sample size was determined through saturation across all 2 industries targeted, with 12 SMMEs from the retail industry and 8 SMMEs from the service industry. The data were analysed using the thematic analysis, and Atlas.ti statistical software was used to assist with data analysis. The study revealed that Tshwane townships receive a wide range of specialised services and assistance from business incubators. These include training, coaching, mentorship, infrastructure provision, financial aid, and networking possibilities. The training services included major topics such as entrepreneurship and financial management. Coaching and mentorship offered hands-on assistance with company growth and model development. Financial services reduce financial limits through group fundraising, investor connections, and loan facilitation. Networking activities enable entrepreneurs to create business groups, obtain market access, and cooperate on new ideas and enterprises. SMMEs face the challenges of financial constraints, administrative and bureaucratic barriers, adjusting to external forces, a lack of managerial experience and limited market access. The study revealed that the role of business incubators in improving SMME growth can be enhanced by focusing on value addition, fostering innovation, offering accessible and diversified finance options and offering tailored support. The study therefore recommends the provision of tailored training, strengthening post-incubation mentorship and support, strengthening ecosystem linkages and market access and rewarding innovative SMMEs.
