Role of business incubation in sustaining small and medium enterprises in the Kingdom of Eswatini

Abstract

Small and medium enterprises (SMEs) are gaining recognition as important stakeholders in achieving economic development. Unfortunately, up to 80% of new businesses fail with two years of existence in the Kingdom of Eswatini. With proper support and nurturing, SMEs can contribute substantially to economic growth and provide employment. Small business incubation is a strategic tool that helps a country to grow its entrepreneurial base, reduce high mortality of SMEs, and subsequently result in poverty reduction in an economy. Although, the government of Eswatini has established business incubators (BIs), business failure continues. This leads one to question the entrepreneurial skills and strategies offered by BIs in Eswatini. The aim of this study was to determine the nature and scope of entrepreneurial skills, knowledge, and abilities that BIs in Eswatini offer to SMEs for the purpose of sustaining and growing their business ventures. The research sought to determine the extent to which BIs augment entrepreneurial competencies of SME owners in Eswatini; to ascertain specific entrepreneurial competencies offered by BIs in Eswatini; to establish if there are specific strategies used by BIs to equip SMEs; and to measure the impact of the incubation programme on the incubated entrepreneurs. The researcher adopted a quantitative approach that used methodological triangulation of both quantitative and qualitative data collection methods. The participants were SME owners, BI managers, and BI trainers. Their answers in questionnaires and interviews generated data for the study. The results of the study revealed that a majority of SME owners and BI managers acknowledge the importance of entrepreneurial competencies to enhance business success. BIs in Eswatini offer training in financial management, records management, project management, and marketing. Unfortunately, those competencies are not meeting all of the SME's needs. Research revealed that there is some breakdown in communication on the BI side, as some of the SMEs are not aware of any helpful strategies that BIs offer post business incubation. Measuring the impact of the incubation programme, based on the success of incubates, was difficult as incubators did not have a graduation. The study recommends that: the government must evaluate the entrepreneurial skills offered by BIs trainers and managers; business incubator stakeholders should include recognised entrepreneurs to assist in mentorship and to share hands on experience to the SMEs; a post incubation programme would assist those SMEs that are still struggling after the set incubation period; and lastly post incubation programme would assist in producing a proper database on performance of SMEs.