Research on the performance of the manufacturing sector

7.1: Business Profiling

It is clear from Figure 26 that the businesses profiled are past the survivalist phase and already sustainable as over 85% has been operating for more than 4 years. Of the businesses profiled 37% indicated that they have been operating for 15 years or more showing that these businesses are well established and have good support structures. 20.4% of businesses indicated that they have been operating for 4 to 7 years and 8 to 10 years respectively which highlights that there was a high number of businesses that are in good positions and are ready to experience growth given that they are provided with the right support and favourable conditions.

Figure 27 shows that 44.4% of respondents indicated that business conditions for SMMEs within the manufacturing sector have deteriorated in recent years (2008 to 2010) due to factors such as the economic recessions of 2009, an increase in foreign imports and an overall slow-down in business, however respondents have indicated that conditions are beginning to improve through stable economic climate and recovery processes that have been put into place both by government and internally by the businesses themselves. 55.6% of respondents indicated that business conditions have improved overall despite challenges faced and that business has increased since 2010.

Figure 29: Percentage of Government Business Procured.

Figure 28 and Figure 29 indicate the percentage of business that profiled businesses procure from government and at what level of government. 53.7% of respondents indicated that they do not do any business with government. Graph 9 indicates the percentage amount that government business contributes to the total amount of business of profiled businesses that do procure government business at some level. It is clear that SMME businesses in the manufacturing sector do not solely rely on government business. Of the respondents that do procure government business 58.8% indicated that government business makes up to 25% of their total business per annum, while 29.4% indicated that government business contributes up to 50% of their total business for the year. This highlights the importance of business contracts procured from the public sector. This highlights the importance of government business amongst SMMEs in the manufacturing sector. This also highlights the need for assistance amongst SMMEs to access new markets and to successfully do business in these markets.