Business relationships as a driver of success for SMMEs in Hout Bay

Abstract

As markets and businesses become more dynamic, administrative and technical skills of entrepreneurs are no longer sufficient to deal with the complexities of modern business management. Businesses wishing to compete at a world-class level must improve the way they interact and deal with the demands of the different stakeholders. One way to do this, is to develop and sustain relationships amongst the network of stakeholders that have the potential to assist in their development, survival and growth. Studies suggest that even if a business does not want to use relationships as a strategy for competing it still has to consider the complexity and connectedness of the marketplace in which it operates. The variety of networks any business finds itself in, requires a strategic perspective, at least to deter it from failing. This study attempted to outline the role played by business relationships in the success of businesses in the communities of Imizamo Yethu, Harbour and the Central Business District in Hout Bay. This research was designed to outline the importance of creating and maintaining a relationship with all stakeholders. The overall approach of this research is guided by the principle that the success of businesses in these communities is driven by the interrelationship between the business owner (as the decision-maker), the employees and the surrounding households (the immediate customers). The research provides guidelines for the business owners on the attributes they should possess in order to maintain these relationships. A relationship survey was designed for the three groups of participants. The information gained from this survey enabled the researcher to report on the nature of these relationships and the role these relationships play in the success of businesses in Hout Bay. The findings of the research were positive: meaning good relationships do exist in the majority of businesses in the community. The comments provided by the owners, staff and surrounding community, together with literature references, provided the researcher the opportunity to discuss the role these relationships have played in achieving success.