Co-operative relationships could be the solution for the challenges faced by small and medium enterprises, especially those owned by women, a new study has revealed.
The yet-to-be-published study by the Wholesale and Retail Leadership Chair at the Cape University of Technology is titled Co-operative Relationships: a Channel for Sustainable Female-owned Informal Retail Businesses in Khayelitsha.
Its authors recommend the promotion of co-operative relationships to develop informal businesses. The researchers argue such relationships are crucial for small businesses because they help to distribute information and other resources such as financial, material and emotional support to members.
Because traders in the informal sector are generally not well-resourced, it is argued the use of co-operative relationships can increase their chances of success and sustainability.
The government sees small and medium enterprises as the key jobs driver by 2030. However, while the National Development Plan has ambitious goals for small and medium enterprises, entrepreneurs face challenges such as red tape.
University of Cape Town Graduate School of Business associate professor Mlenga Jere, the study’s lead researcher, said that co-operative relationships, especially in the form of stokvels, were the norm, but had to be formalised for members to reap benefits.
The researchers surveyed 173 female-owned informal businesses in Khayelitsha.
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