Effects of Emergence of Shopping Malls on SMMEs in eThekwini

The growth of the Small Medium and Micro Enterprise (SMMEs) has been phenomenal in the last 17 years since the advent of democracy in South Africa. Turbulant economic conditions have also led more people to seek opportunities for survival by participating in the economy as small entrepreneurs. Small entrepreneurs in townships lack sophistication to understand new development trends in business such as the emergence of shopping malls in townships, bringing along major national and international retailers. The study aims to determine the effects of the emergence of shopping malls on SMMEs in eThekwini: A case study of Umlazi. The Umlazi Mega City Mall is used as a point of reference. The challenges faced by small business owners after the emergence of Umlazi Mega City will be explored in detail in this study.

A probability sample of 120 small businesses falling under the SMME sector were identified based on a population of approximately 500 SMMEs operating in and around Umlazi. It is important to highlight that from the above sample, 100 completed the questionnaire, which was used for data analysis. Quantitative research method was used and a questionnaire with a total of 25 closed questions was used to collect data directly from participants. The questionnaire was distributed directly to respondents and that proved to be very effective but time consuming. The presentation of results has been covered using graphs, tables and statistical percentages. The analysis is accompanied by the researcher’s interpretation and remarks to explain the salient features discovered in the findings.

The respondents in this study ranged from street hawkers, chicken stalls, shoe repairs, butcheries and supermarket owners. The findings revealed that the majority of participants indicated a decrease in turnover after the emergence of Umlazi Mega City. One of the recommendations put forward was that, new developments of shopping malls should create an empowerment venture of not less than 10% that would be owned by a consortium of SMMEs. This arrangement has a potential to build loyalty of SMME tenants if they become part of that mall, and at the same time, remove resentment. The definition of the sizes “small business” and “medium business” will be covered during the course of the research.