Province of the
EASTERN CAPE
DEPARTMENT OF ECONOMIC DEVELOPMENT
& ENVIRONMENTAL AFFAIRS
___________________________________________________________________________
AN INTEGRATED STRATEGY FOR PROMOTION
OF ENTREPRENEURSHIP AND SMALL
ENTERPRISES IN THE EASTERN CAPE
“A Framework for Creating an Enabling Environment for SMME Support, Promotion
and Development”
4th DRAFT
OCTOBER 2009
TABLE OF CONTENTS
FOREWORD: MEC MCEBISI JONAS...................................................................................4
EXECUTIVE SUMMARY.........................................................................................................6
SECTION 1: INTRODUCTION AND BACKGROUND ..........................................................10
1.1 Introduction............................................................................................................................................................10
1.2 Summary of activities and deliverables.................................................................................................................12
SECTION 2: SITUATION OF SMMES IN THE EASTERN CAPE.........................................14
2.1
Highlights of Findings from the Questionnaires..................................................................................................15
2.2
Highlights of Policy issues from Workshops........................................................................................................16
2.3
Problems and Challenges of the SMME Environment in the EC.........................................................................19
SECTION 3: SMME SUPPORT STRATEGY FOCUS...........................................................21
3.1
Vision for supporting SMMEs in the Eastern Cape.............................................................................................21
3.2
Objectives of the SMMEs Support Strategy.......................................................................................................21
SECTION 4: POLICY AND STRATEGY LITERATURE ANALYSIS.....................................22
4.1 National Policy and Legislative Analysis.............................................................................................................22
4.1.1
1995 White Paper on SMME Promotion.....................................................................................22
4.1.2
National Small Business Act of 1996, as Amended in 2004.......................................................23
4.1.3
Strategy on the Promotion of Entrepreneurship & Small Enterprises..........................................23
4.1.4
National Strategy for the Development and Promotion of Franchises..........................................24
4.1.5
National Industrial Policy Framework (NIPF)...............................................................................25
4.2 Provincial Strategies Analysis...............................................................................................................................26
4.2.1 Provincial Growth and Development Strategy (PGDS)...............................................................................26
4.2.2 Draft Provincial Industrial Strategy..............................................................................................................27
4.2.3 Provincial Co-operatives Support Strategy................................................................................................28
SECTION FIVE: STRATEGIC PILLARS...............................................................................29
5.1 Strategy Pillar One: SMME Institutional Framework ............................................................................................. 29
Strategic Priority 5.1.1: Develop Capacity within DEDEA............................................................................................29
Strategic Priority 5.1.2: Establish a Forum for Development Finance Institutions........................................................29
Strategic Priority 5.1.3: Establish a Provincial SMME Working Group........................................................................30
Strategic Priority 5.1.4: Establish an Enterprise Development Agency in the Eastern Cape.......................................30
Strategic Priority 5.1.5: Establish an Innovation Hub for product development and manufacturing..............................31
5.2 Strategic Pillar Two: SMME Programme Design and Support ..............................................................................34
Strategic Priority 5.2.1: Increase Supply of Financial Services.....................................................................................34
Strategic Priority 5.2.2: Increase Supply of Non-Financial Services............................................................................35
Strategic Priority 5.2.3: Access to Markets through Government Procurement.........................................................36
Strategic Priority 5.2.4: Enhance Access to Markets to Industry Opportunities for SMMEs.........................................37
Strategic Priority 5.2.5: Increase Access to Franchise Opportunities in the Eastern Cape..........................................38
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SMME Strategy Framework
Strategic Priority 5.2.6: Skills Enhancement of SMME Owners...................................................................................38
Strategic Priority 5.2.7: Support to the Informal Sector and Hawkers..........................................................................39
Strategic Priority 5.2.8: Support to Organised Business Formations of SMMEs...........................................................40
Strategic Priority 5.2.9: Access to SMME Information...................................................................................................40
5.3 Strategic Pillar Three: SMME Regulatory Functions and Services........................................................................42
Strategic Priority 5.3.1: Reduce Small Business Regulatory Constraints and Awareness...........................................43
Strategic Priority 5.3.2: Capacity Building of Municipality Officials on Regulations and By-Laws................................43
5.4 Strategic Pillar Four: Monitoring and Evaluation ...................................................................................................44
Strategic Priority 5.4.1: Conducting Ongoing Research about SMMEs in the Province...............................................44
Strategic Priority 5.4.2: Align all District and Metro SMME Strategies with the Provincial Strategy..............................45
Strategic Priority 5.4.3: Developing Knowledge and Information about SMMEs to inform Policy.................................45
Strategic Priority 5.4.4: Hosting Annual SMME Conferences, Seminars and Summits................................................46
Strategic Priority 5.4.5: Monitoring of the Implementation of the Provincial SMME Strategy........................................46
Strategic Priority 5.4.6: Evaluation of the Strategy.......................................................................................................47
SECTION SIX: IMPLEMENTATION PLAN OF THE STRATEGY .........................................48
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FOREWORD: MEC MCEBISI JONAS
Honourable Mcebisi Jonas
MEC: Economic Development and Environmental Affairs
Eastern Cape Province
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SMME Strategy Framework
EXECUTIVE SUMMARY
This Provincial SMME Strategy Framework outlines the intention of the
Provincial Government of the Eastern Cape in supporting the development
and the sustainability of the SMME sector. To a large extent, it is aligned to
national policy and legislative priorities of the dti and to the Provincial Growth
and Development Priorities. It is the result of extensive review of literature
available on SMMEs development, a high level research exercise with
SMMEs through questionnaires was also conducted, workshops with SMMEs
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SMME Strategy Framework
in most of the District Municipalities were conducted and finally relevant
nationally based institutions that support SMMEs were also consulted.
The vision of this SMME Strategy is to mainstream Small and Medium
Enterprises into the economy of the province through opportunities created by
the industry in order to enhance entrepreneurship and self employment. This
is proposed to be done through the process of identifying key growing
economic sectors of the province, developing economic sector studies and
economic sector value chains. The idea is to provide for an SMME sector that
plays a key role into the growth of the provincial economy thereby alleviating
poverty and creating employment. Key objectives outlined in this strategy
include the following:

To provide for the establishment of appropriate institutional support
framework in the Eastern Cape for SMMEs to be mainstreamed into
the provincial economy;

To provide better access to existing and the development of new
SMME support programmes in the Eastern Cape;

To create an enabling environment for SMME to thrive in the province
by conducting continuous policy and strategy reviews in the Eastern
Cape;

To provide for better collation of information, monitoring and reporting
about SMME development in the province through continuous research
and knowledge management
In order to achieve the objectives listed above, thereby realising the vision, the
following strategic pillars and projects are proposed for implementation:
Strategy Pillar One: SMME Institutional Framework

Develop Capacity within DEDEA

Establish a Forum for Development Finance Institutions

Establish a Provincial SMME Working Group

Establish an Enterprise Development Agency in the Eastern Cape
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
Establish an Innovation Hub to enhance product development and
manufacturing in the Province
Strategy Pillar Two: SMME Programme Design and Support

Increase Supply of Financial Services

Increase Supply of Non-Financial Services

Access to Markets through Government Procurement

Enhance Access to Markets to Industry Opportunities for SMMEs

Increase Access to Franchise Opportunities in the Eastern Cape

Skills Enhancement of SMME Owners

Support to the Informal Sector and Hawkers

Access to SMME Information
Strategy Pillar Three: SMME Regulatory Functions and Services

Reduce Small Business Regulatory Constraints and Awareness

Capacity Building of Municipality Officials on Regulations affecting
SMMEs and how to manage them
Strategy Pillar Four: Monitoring and Evaluation

Conducting Ongoing Research about SMMEs in the Province

Align and Integrate all the District and Metro SMME Strategies with the
Provincial Strategy Framework

Developing Knowledge and Information about SMMEs to inform Policy
and Programmes in the Province

Hosting Annual Conferences, Seminars and Summits on SMME
Development in the Province

Monitoring and Evaluation of the Implementation of the Provincial
SMME Strategy
This document is therefore structured as follows:
Section 1: Introduction and Summary of Activities
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This section outlines policy background relating to SMME development in
South Africa. It highlights some achievements and challenges that the South
African government still face in supporting the growth and development of
SMMEs. These challenges are applicable to the environment of the Eastern
Cape as well. This section also sketched the process that was followed in
developing this strategy
Section 2: Situational of SMMEs in the Eastern Cape
Two forms of data gathering methods were used during the process of
developing this strategy, Questionnaires and Workshops. This section
highlights findings that emanated from these methods and those findings are
used to structure proposals mentioned above. The questionnaire method was
by far not exhaustive and it had its own limitations therefore a detailed
process of research about SMMEs in the province still needs to be
undertaken. Challenges identified are clustered into SMME specific
challenges and government challenges in supporting SMMEs
Section 3: SMME Support Strategy Focus
The discussions held with SMMEs and Stakeholders in this process resulted
in the crafting of a vision that provincial government needs to pursue in order
to realise the vision of mainstreaming SMMEs to the economy of the province.
This section sketches that vision and the objectives to be pursued to realise
the vision
Section 4: Policy and Strategy Literature Analysis
In order to show that this strategy is aligned to the priorities of national
government under the leadership of the dti, a lot of analysis of available
literature and policy documents was done. This section delves into the detail
of what legislative and policy document underpin the work of SMME
development and how it is aligned to this Strategy document.
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SMME Strategy Framework
Section 5: Strategic Pillars and Priorities for supporting SMMEs
This section carries concrete proposals and projects that the provincial
government needs to implement to ensure that there is an enabling
environment for SMME development in the province. These proposals are
structure into four pillars and proposed projects are listed under each pillar.
Section 6: Implementation Plan
This section guides the Department of Economic Development and
Environmental Affairs with key activities, deliverables and responsibilities of
each proposed project under the pillars. It is envisaged that once approved
this section will be used to develop annual performance plan and tracking
tools.
SECTION 1: INTRODUCTION AND BACKGROUND
1.1 Introduction
It is generally accepted worldwide that the development and growth of small,
micro and medium enterprises (SMMEs) can play an important role in turning
the situation of high levels of unemployment in an economy. This is largely
because entrepreneurship and small business development naturally bring
with it elements of innovation and new venture creation which in turn create
new industries that have the ability to create employment. Policies and
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programmes that support the development of SMMEs should therefore form
an important part of any government’s programmes in order to create a better
life for all. To date, South Africa has over 13 years experience in providing
support to the SMME sector but the challenges that were identified as far back
as 1995 are still relevant today. The table below illustrates the point above:
The 1995 White Paper on the
Promotion of SMMEs in SA
Remaining Challenges: Ten Year
SMME Review 1994-2004













Creation of an enabling legal framework;
Streamlining regulatory conditions;
Facilitating access to information and advice;
Facilitating access to procurement and
marketing;
Facilitating access to finance;
Facilitating access to affordable physical
infrastructure;
Providing training in entrepreneurship, skills
and management;
Improving industrial relations and the labour
environment;
Facilitating access to appropriate technology;
Encouraging joint ventures;
Capacity
building
and
institutional
strengthening;
Introducing different taxation and other
financial incentives








Source: 1995 White Paper
Diversity of SMMEs need serious recognition
and attention;
Access to SMME support to be same in urban
and rural areas;
Create a balance between cost, reach and
impact of support where government funds
are concerned;
Lack clarity of roles in SMME support by the
public sector thereby making their efforts uncoordinated and less effective;
Inadequate
representation
of
evolving
business associations and interest groups
weakens feedback on specific SMME needs
Insufficient interaction between SMME
support programmes and other thrusts of
Government
The dti Chief Directorate: Small Enterprises
has been unable to co-ordinate activities of
Government on small business nationally and
provincially
Provinces lack of capacity and human
resources have also yielded bad results in
providing direction and support to the SMME
sector
Inadequate and irregular monitoring and
evaluation processes
Source: 2005 Ten Year Review Report
Since the introduction of the 1995 White Paper on Small Business Promotion
by the government of the Republic of South Africa the country has seen an
emergence of a range of programmes geared at promoting SMME
development. Some of them were sponsored by the private sector but
certainly most of them were government driven. The 1996 National Small
Business Act established two very important institutions in the life of small
business in this country, i.e., Ntsika Enterprise Promotion Agency (NEPA) and
the National Small Business Council (NSBC). Alongside these two institutions,
the dti also established Khula Enterprise Finance and the National
Manufacturing Advisory Centres (NAMAC). These institutions formed the
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backbone of all small business promotion activities in South Africa from the
late 1990’s to around the year 2004. From the year 2005, government
established the Small Enterprise Development Agency (seda) as the lead
agent that supports the development of SMMEs in the country. To date, the
seda exists in provinces in partnership with the Provincial Departments of
Economic Development.
The Department of Economic Development and Environmental Affairs
(DEDEA) in the Eastern Cape has deemed it necessary to develop a
provincial strategic framework to guide the support to small businesses in the
province. Chumisa Consulting was therefore contracted by DEDEA to
facilitate the development of the provincial strategic framework through a
consultative process with stakeholders in the province. The data gathering
process employed different research methodologies that assisted in gathering
data that was used to structure proposals advance herewith.
This document is the outcome of a process of consultations, especially with
SMMEs and stakeholders in the province supporting SMMEs. It also attempts
to align to current SMME policy priorities as set out in the 2005 dti Strategy
for the Promotion of Entrepreneurship and Small Enterprises together with the
2004 Amended Small Business Act. Most importantly, it captures views and
opinions of SMMEs in the province and what their needs are in developing
and sustaining their businesses.
The most important observation identified in this process is that amongst the 6
District Municipalities in the Eastern Cape only 3 District Municipalities have in
place formalised District SMME Strategies, viz, Amathole, Chris Hani and
Cacadu. The other 3 District plus the Metro do not have formalised District
SMME Strategies. The province as a whole is therefore not moving in sync on
SMME development and it is anticipated that this process will assist in guiding
all the District Municipalities and the province as a whole. It is the mandate
and the responsibility of DEDEA to advise on how this alignment across the
province should be done.
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The strategic pillars and interventions proposed in this document are
premised on inputs from SMMEs themselves and are most importantly
informed by the framework of the national SMME Strategy of 2005 of the dti
that has been approved by National Cabinet. To a large extent, this Provincial
SMME Strategy is aligned to national policies and legislative framework that
govern support to SMMEs nationally.
1.2 Summary of activities and deliverables
A series of activities were proposed as a response to the Department’s
invitation to conduct this assignment and the following were concluded in the
process of developing this document.

An SMME Survey through Questionnaires: A total of 204 completed
questionnaires were from SMMEs across the province were analysed
and the results are captured in a separate report attached herewith as
part of this document;

Workshops with SMMEs in all District Municipalities: A series of
District Consultative Workshops with SMMEs were held in all Districts
except in Nelson Mandela Metro and Amathole. A comprehensive
report of issues that were raised in the workshops is also attached
herewith as part of this document;

SMME Literature Analysis: A thorough review of current government
SMME policies, strategies and relevant legislations were reviewed
during this process in order to align proposals with the current thinking
of government on SMME development;

One on One Meetings with SMME Stakeholders: a range of relevant
stakeholders were consulted at national and provincial level and inputs
solicited in the process of developing this document. These
stakeholders are in the main service providers, government institutions
and private sector organisations that support SMMEs. It is envisaged
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that a Consultative Workshop with provincial stakeholders will be
arranged to discuss the draft document once it has been released.
SECTION 2: SITUATION OF SMMES IN THE EASTERN
CAPE
In the process of developing this Provincial SMME Strategy Framework
document, analysis of a whole range of SMME related policy documents,
research reports, strategies and legislation was analysed. It is worth noting
that we were also able to specifically review the SMME Survey reports of both
the Amathole District and the Cacadu District. Generally, about 70% of
SMMEs fail in South Africa within the first three years with the majority failing
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within the first 12 months. The Cacadu District study makes the following
observations about why SMMEs fail within the first 12 months:

Most of these SMME’s are owned by people from previously
disadvantaged backgrounds with very low levels of skill and
experience in running businesses;

The majority of SMMEs are based in rural areas, involving largely
micro enterprises that have barely grown beyond the survivalist stage,
As already mentioned above, a separate detailed SMME Survey Report is
attached to this strategy document, as such, only key findings are highlighted
in this section as a form of illustration.
According to CIPRO, as at September 2008 the number of SMMEs (close
corporations and companies) registered and residing in the Eastern Cape
province was around 12 246. Data provided below provides a reflection of the
trends of registration of entities in the Eastern Cape Province for each year
from 2005 – 2008.
Table 2: Registration Trends of CCs and Cos.
Years
Close Corporations
registered
2005
2006
2007
2008
Source: CIPRO, September 2008
Companies registered
2045
5088
9309
11758
23
31
148
488
2.1 Highlights of Findings from the Questionnaires
A high level research exercise was conducted through a Questionnaire during
this process. The purpose of the questionnaire was to unearth concrete data
such as the type of SMMEs that exist in the province, the product offering,
access to markets issues and level of skills development. It was also meant to
generate understanding of what respondents perceive to be the challenges
and opportunities they are faced with as well as key suggestions they might
have for provincial government to assist them become sustainable. In order to
ensure some form of reliability of the research, the same questionnaire was
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administered to all respondents through a participatory process of completing
them during the workshops that we held in the Districts. The following
limitations influenced this study:

Time and financial constraints because the research was not
budgeted for in the process of developing the strategy;

The province does not have a database of SMMEs which we could
have used to select a sample to test the questionnaire with. There
was heavy reliance on entrepreneurs who will attend District
Workshops to form respondents to this study;

Municipalities
database
of
entrepreneurs
incorporates
both
members of co-operatives and individual entrepreneurs;

The questionnaires that were used were not initially tested on a
small sample in order to allow for amendment to the questions. This
was largely because of the lack of available database and the short
timeframes to start and complete the project;

The other limitation is that only one data gathering instrument was
used during this process therefore no inconsistencies were
identified up in the process;
The completed questionnaires were then loaded on Statistical Package fro
Social Sciences (SPSS) software which assisted in providing predictive
analytics that is detailed in the report we produced. This analysis assisted by
connecting the data from the questionnaires to effective action and by drawing
reliable conclusions about current conditions of SMMEs in the Eastern Cape.
The following findings came out of the analysis of 204 completed
questionnaires:

The predominance of SMMEs (58%) are in the services sector
(catering, small scale retailers, security, etc) in all Districts, followed by
the manufacturing sector. A significant showing of manufacturing
SMMEs in all districts is concentrated around the Textile sub-sector,
not the automotive sector as it would be expected in accordance with
structure of the Eastern Cape economy;
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
SMMEs employing 1-5 people were 66%, followed by 21% that employ
between 6 – 10 people and only 10% employing more than 10 people;

Generally owners of SMMEs surveyed have only a matriculation
certificate or Grade 12 (32%), with seventeen percent (17%) having
relatively low education levels below matric;

The majority of their start up capital is from their own personal savings
(66.7%) and mostly from parents and friends. The ECDC has only
reached out to 0.5% of the respondents on access to start up finance;

Financial requirements of SMMEs surveyed showed that the majority of
them (55.6%) is for equipment & materials followed by working capital
(22.9%).
The above synopsis gives an overview of the profile of an SMME in the
Eastern Cape and this sector is as important to government as the formal
sector is. These are the types of SMMEs that are not likely to access funds
from ECDC because they would not need the criteria. However, they form the
fibre of the business society of the province and can play a big role in poverty
alleviation and employment creation thereby complementing the work already
being done by medium and big business in the province.
2.2 High Level Policy issues from Workshops
A total of 5 workshops with about 250 SMMEs were held in District
Municipalities across the province of the Eastern Cape. In organising these
workshops we were assisted by the officials of the Regional Offices of
DEDEA. We also got an opportunity to analyse District IDPs in relation to
them
supporting
SMMEs
and
also
interviewed
Officials
of
District
Municipalities. At a policy level, even though the province currently does not
have a Provincial SMME Strategy, other District Municipalities are active in
SMME promotion. For example, the table below demonstrate the facts:
Table 3: District SMME Strategies
District Municipalities
Policy or Strategy Environment
Amathole District Municipality

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A Comprehensive study of the SMMEs
in the District has been completed
SMME Strategy Framework

Chris Hani District Municipality

Nelson
Mandela
Metro 
Municipality
Cacadu District Municipality

Ukhahlamba District Municipality
Alfred Nzo District Municipality
OR Tambo District Municipality
District SMME Strategy Completed
District SMME Strategy Completed
The 2001 Metro SMME Strategy is
outdated and still needs to be updated
A comprehensive Study of SMMEs in
the District has been completed
District SMME Strategy does not exist
District SMME Strategy does not exist
District SMME Strategy does not exist
From the table above, it is quite clear that the province is pulling to all sorts of
directions around SMME development and this situation needs immediate
attention. The following key policy issues emerged out of the workshops:

The Regional Offices of DEDEA’s role and function is not clear and
needs to be defined in the context of activities of SMME development
within each District Municipality;

The Chief Directorate: Enterprise Development of DEDEA needs to
facilitate a process of guiding other District Municipalities to develop
their SMME strategies and/or support programmes and then monitor on
behalf of the province;

SMMEs that we interacted with and the ones who responded to our
questionnaire are not in the mainstream of the economy. The kinds of
businesses they operate are not in line with downstream activities of
the growing economic sectors of the provincial economy and hence
they are not able to access support from organisations like ECDC and
banks.

SMMEs are not aware of economic opportunities that are available to
them within their Districts and therefore are not able to align their
activities with such opportunities;

The economic opportunities that emanate from the Provincial Industrial
Strategy will provide a sense of which economic sectors SMME
development should be encouraged and what incentives should be
developed to encourage their growth;

Research and provision of statistics remains a major problem across
the province and we suggests that DEDEA be the central co-ordinating
point, through its Regional Offices;
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
Procurement opportunities from government remain a problematic area
for most SMMEs. A policy statement needs to be made around setting
targets, implementing them and monitoring how many SMMEs benefit
from government procurement in the province;

Accessibility of state support institutions, especially in the rural part of
the province also remains a major problem. For instance, it was
mentioned in that in Alfred Nzo and Cacadu there are is no ECDC
office and that it is DEDEA’s role to ensure that there are offices in
these areas;

The rural part of the province does not have tangible SMME activities
that are based on economic sectors and guided by the PGDP of the
province;

The informal sector of the economy in the Eastern Cape remains
extremely poor with no support at all. We also found out that this is not
only the problem of the Eastern Cape, even at the national government
level (the dti) there is no policy directive on how the informal business
sector should be supported. The province should then develop tailor
made support programmes to ensure that the informal sector is
sustained. The informal sector is a permanent feature of the provincial
economy and provides employment opportunities for a significant
section of the provincial population.
Most of the other inputs came as challenges that SMMEs face, some of which
have been captured in detail in the survey report. The following section will
highlight common challenges that SMMEs and government of the Eastern
Cape face. It is these challenges that shape the proposed support
interventions proposed in the strategy.
2.3 Problems and Challenges of the SMME Environment in the Eastern Cape
Problems and challenges of SMMEs are not only inherent but also influenced
by the environments that they operate in. SMMEs that attended the
workshops and participated in our survey identified the following challenges
that affect them directly:
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
Lack of access to funding for working capital, equipment and business
expansion;

Lack of access to procurement and tender opportunities from
government and government institutions;

Low levels of education of owners of SMMEs;

Lack of required technical, business and management skills;

Lack of quality of products and services and inability to deliver on time;

Lack of access to relevant information for business support.
On the other hand, there are environmental challenges that the provincial
government, in particular DEDEA faces in its mandate to create an enabling
environment for SMME development in the province. The following is a
clustered list of the key challenges that DEDEA faces:

There is no coordination of activities of government institutions and
departments that provide services to SMMEs, everybody works in silos;

Lack of staff, direction and capacity at DEDEA to monitor SMME
development in the province;

The mandate of the implementing agency of the province (ECDC) is
too broad and its work needs to be focused towards SMME financing;

There is general lack of data, research and knowledge about SMMEs
of the province;

Government Departments in general are notorious for paying SMMEs
very late after the services have been rendered;

There is generally no consistency in the existence of SMME strategies
and programmes across the Districts, including clarity of roles of
DEDEA Regional Staff roles in supporting implementation at District
level.
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SECTION 3: SMME SUPPORT STRATEGY FOCUS
3.1. Vision for supporting SMMEs in the Eastern Cape
To mainstream Small and Medium Enterprises into the economy of the
province through opportunities created by the industry in order to enhance
entrepreneurship and self employment.
3.2. Objectives of the SMMEs Support Strategy
The strategic objectives listed below are linked to the strategy pillars and their
key strategic priorities:
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3.2.1 To provide for the establishment of appropriate institutional support
framework in the Eastern Cape for SMMEs to be mainstreamed into
the provincial economy;
3.2.2 To provide better access to existing and the development of new
SMME support programmes in the Eastern Cape;
3.2.3 To create an enabling environment for SMME to thrive in the province
by conducting continuous policy and strategy reviews in the Eastern
Cape;
3.2.4 To provide for better collation of information, monitoring and reporting
about SMME development in the province through continuous research
and knowledge management.
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SECTION 4: NATIONAL AND PROVINCIAL POLICY
AND LEGISLATIVE ANALYSIS
4.1 National Policy and Legislative Analysis
At a national government level, the work of SMME development and support
is the mandate of the Department of Trade and Industry (the dti)
complimented by a range of support agencies established by government like
Small Enterprise Development Agency (seda) and Khula Enterprise Finance.
However, there are other policies and legislative imperatives that guide the
support to the development of the SMMEs and these policy documents guide
SMME support at national level and therefore inevitably inform this Provincial
SMME Strategy. Below is a summary of the key documents:
4.1.1 The 1995 White Paper on SMME Promotion
This White Paper represented government's thinking about what it can
contribute to the process of stimulating small, medium and micro-enterprises
(SMMEs) in South Africa. The development of the document was as a result
of an intensive process of consultation with key stakeholders in the SMME
sector. A number of key challenges that were facing SMMEs in 1995 had
been addressed by the government through the establishment of relevant
institutions, some of which still exist today.
Since then, the most glaring challenge of government in SMME development
is in the coordination of SMME support services. Though a lot has been done
to date, provinces have not been able to interpret the national policy
imperatives on SMME development with the intention of developing their
provincial strategies. The dti has since updated the 1995 White Paper to the
current 2005 National Strategy on the Promotion of Entrepreneurship and
Small Enterprises.
4.1.2 National Small Business Act of 1996, as Amended in 2004
The next important step was the passing of the enabling legislation, the
National Small Business Act No.102 of 1996. The Act was developed to
provide for:
 The establishment of Ntsika Enterprise Promotion Agency (Ntsika);
 The establishment of the National Small Business Council (NSBC);
 The guidelines for the organs of state to promote SMMEs
 To provide for the definition of SMMEs in respect to the different
sectors of the economy of South Africa
This is an enabling legislation whose main purpose was to regulate and define
SMMEs in order to elevate their importance to the growth and development of
the economy. Through this Act, government also established support
institutions at national level whose main purpose was to drive support to small
businesses. Ongoing reviews of activities of SMME development in the
country necessitated the Amendment to the National Small Business Act in
2004. The current legislation is the amended Act of 2004 and it will also be
the overall guiding legislation for the activities of SMME promotion in the
Eastern Cape.
The definition of SMME in the context of the evolving environment is currently
a subject of review within the dti. The Broad Based Black Economic
Empowerment Codes of Good Practice have since come up with innovative
classifications of an SMME in terms of empowerment, Qualifying SMME. The
province will be guided by the dti in this exercise. However, a process of
aligning the BBBEE classification and the definition of an SMME in terms of
the 1996 SMME Act as amended in 2004 is already underway under the
leadership of the dti. Therefore, for the purposes of this Provincial Strategy,
the definition of SMMEs is aligned to Section 1(XV) and the Schedule as
outlined in the 1996 Small Business Act, as amended in 2004.
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4.1.3 Strategy on the Promotion of Entrepreneurship & Small Enterprises
The 2005 National Strategy for the Promotion of Entrepreneurship and Small
Enterprises is the current guiding and approved National Strategy document
of government. The main thrust is to bring about co-ordination and
streamlining of SMME promotion activities across the whole country. It is this
strategy document that will also guide the structure of the Eastern Cape
SMME Strategy. This National Strategy document is premised on the
following 3 Pillars:

Increase supply of access to finance and non-financial services;

Create demand for small enterprise products and services;

Reduce small enterprise regulatory constraints.
In line with national government priorities on SMME development, the Eastern
Cape SMME Strategy will also be premised on the above pillars and other
relevant provincial suggestions that came out during the consultation
processes undertaken in developing this document.
4.1.4 National Strategy for the Development and Promotion of Franchises
A policy document of the dti called the National Strategy for the Development
and Promotion of Franchises in South Africa dated June 2000 was an attempt
by the government to elevate issues of Franchising. The Franchise sector
which is an integral part of the small business sector, has considerable
potential for contributing to job creation, wealth creation and the promotion of
economic equality in South Africa.
Evidence exists in the 2008 Franchise Survey of the contribution of the
Franchise sector to the growth of small enterprises. The Franchise sector is
particularly relevant to the Eastern Cape because almost all the SMMEs that
we met during consultations are not participating in the mainstream of the
growing economic sectors of the Eastern Cape Province. Provincial
Government therefore has a role to play in mainstreaming entrepreneurs into
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the economy of the province, and we believe through Franchising the
province can easily harness the existing entrepreneurship spirit.
At the moment, the Eastern Cape Province does not have a dedicated
Franchise Support and Development Programme in place. An opportunity
therefore exists through this Provincial SMME Strategy to seriously consider
focusing towards franchising in order to encourage entrepreneurship and
small business ownership. The existing Franchise Strategy document of the
dti can easily be adapted by the Eastern Cape Government in its endeavour
to develop a provincial programme.
4.1.5 National Industrial Policy Framework (NIPF)
In July 2007 the Cabinet endorsed the National Industrial Policy Framework
(NIPF) that sets out in detail key actions and timeframes for the
implementation of the current round of industrial policy. This is in realisation of
the fact the manufacturing sector can bring employment and enhance
entrepreneurship in the country, factors which can only be realised through
SMMEs development.
The NIPF identifies a range of economic sectors that government is going
to concentrate on in order to encourage manufacturing SMMEs, and they
include the following:

Fast-track implementation of the four lead sectors: Capital/Transport
equipment and Metals; Automotives and Components; Chemicals,
Plastic fabrication and Pharmaceuticals; Forestry, Pulp and paper,
and Furniture.

Maintaining momentum on implementation of Business Process
Outsourcing & Offshoring (BPO&O), Tourism and Biofuels,
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
Implementation of other substantive sector projects in: Diamond
beneficiation and jewellery; Agro-processing; Film and Crafts.

Other sector strategies that need to be developed include: Mining
and mineral beneficiation; Agriculture/Agro-processing; ICT (services
and products) and Creative Industries and White Goods (fridges,
microwave ovens, washing machines, etc).
In line with the NIPF, the province of the Eastern Cape will need to align its
sector development initiatives towards these economic sectors in order to
encourage SMMEs to take up opportunities that arise from the sector value
chains.
4.2 Provincial Strategies Analysis
4.2.1 Provincial Growth and Development Plan (PGDP)
The PGDP provides the strategic framework, sectoral strategies and
programmes aimed at a rapid improvement in the quality of life for the poorest
people of the Eastern Cape Province. To do this, the PGDP sets out a vision
with quantified and sequenced targets in the areas of economic growth,
employment creation, poverty eradication and income redistribution for the 10year period 2004-2014.
In relation to SMME development, The PGDP identifies as one of its focus
areas the development and diversification of the manufacturing and tourism
sectors within the province. To realise this provincial government needs to
clearly understand and articulate the economic competitive advantages of the
province and each District Municipality. SMMEs can only be developed and
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mainstreamed into the economy if the above knowledge is made available
and utilised appropriately.
The PGDP further notes that existing growth in the province is centred on the
major urban areas of Nelson Mandela Metro and Buffalo City. These areas
are especially high in growth and export-led manufacturing industries. Growth,
however, is needed throughout the Province, especially in labour-intensive
industries for employment creation.
The natural resources of the former homelands provide opportunities for
SMME
growth
through
agro-processing
industries.
Opportunities
for
processing SMMEs will increase as agricultural production grows in the
former homelands. Small enterprises can be successfully established in food
processing (fruits and vegetables, dairy products and meat products), leather
and leather goods, wood products, furniture production, wool and mohair
clothing, crafts and tourism.
There is a growing body of information on business opportunities in the
districts of the Province, based on proximity to natural resources and links to
existing industries. The main opportunities lie in targeting major gaps in the
supply chain and processed products. Big businesses can be encouraged to
invest in districts, based on their competitive advantages in raw material,
skilled labour and market access. Local Economic Development (LED)
strategies for each District and Local Municipality need to be included in their
IDPs because that is where SMMEs can actively be mainstreamed.
4.2.2 Draft Provincial Industrial Strategy
This document is a set of dedicated government-sponsored plans and
interventions designed to build the productive capability to place the province
on a more equitable and labour absorptive growth path. The strategy is
premised on the extent to which it is able to sustain growth, create jobs, and
transform the economy in terms of de-racializing and broadening ownership of
capital and assets.
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The Provincial Industrial Strategy processes, supported by the PDGP and the
Jobs Summit, have identified a number of priority sectors for growth and
employment creation as well as retention. Economic growth and labour
absorptive sectors include agro-processing (especially biofuels), forestry and
timber
industries,
tourism
and
cultural industries,
business
process
outsourcing (BPO), construction, chemicals, and metals processing. Sectors
important for jobs retention are the auto sector, clothing and textiles. These
sectors also provide a whole range of downstream opportunities for SMME
development.
Mainstreaming SMMEs in the economy of the province would not be such a
huge challenge if the Industrial Strategy of the Province was finalised and
adopted as policy and also if opportunities for SMME development were
clearly articulated within sector studies.
4.2.3 Provincial Co-operatives Support Strategy
At the end of the year 2008, the Provincial Government of the Eastern Cape
adopted a Provincial Co-operatives Support Strategy. Co-operatives are a
legal form of entity that was legislated by the South African government
through the Co-operatives Act No.14 of 2005. This piece of legislation
recognises different forms of co-operatives, viz, housing, social services,
worker, financial services, agriculture, etc. Some of these forms are closely
linked to SMMEs in the manner in which they are established and how they
function. The support programmes apportioned to these forms of cooperatives tend to be naturally the same as the support programmes geared
towards SMME development. A proper alignment between the Co-operatives
and SMME Strategy is therefore critical in creating integration across the
province on enterprise development activities.
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In order to grow and promote the co-operative movement in the Eastern
Cape, the Co-operatives Strategy proposes the following action points which
are arranged in four major pillars:

Pillar 1: Institutional Capacity for Supporting Co-operatives in the
Province;

Pillar 2: Support Infrastructure for Co-operatives Development;

Pillar 3: Building an Independent Co-operative Movement;

Pillar 4: Research, Knowledge and Database Management.
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SECTION FIVE: STRATEGIC PILLARS AND PRIORITIES
FOR SUPPORTING SMMES IN THE EASTERN CAPE
5.1 Strategy Pillar One: SMME Institutional
Framework
Strategic Priority 5.1.1: Develop Capacity within DEDEA
The implementation of this strategy is going to require resources, both
financial and human resources. In order to ensure effective implementation,
provincial government will need to allocate financial and human resources to
DEDEA to coordinate all these activities. Our consultations revealed that there
are project management challenges at implementation level between
Regional Offices of DEDEA and the Municipalities. This is a serious matter
because in order to effectively implement this strategy, DEDEA needs full
support of Local Government structures. We propose the following:

The functions of the Regional Staff should be redefined in line with the
implementation of the SMME Strategy;

Regional staff need to be trained in Policy Development, Monitoring and
Evaluation, SMME Policy and Legislation and Research;

DEDEA Head Office should apportion a budget for each Regional Office
for SMME projects in order to support Municipalities with matters that
relate
to
SMME
research,
awareness
programmes,
information
dissemination and monitoring activities of the Provincial SMME Strategy;
Strategic Priority 5.1.2: Establish a Forum for Development
Finance Institutions
Government has established a range of institutions at national level that
provide funding for SMMEs. These institutions have since established a
footprint in the Eastern Cape but unfortunately they also operate in isolation
and their impact is not clearly measurable. These institutions command huge
udgets and certainly can benefit SMMEs in the province if their activities can
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be properly co-ordinated in the province and their impact measured. In order
to ensure co-ordination of their activities the following activities are proposed:

Develop a complete database of all the existing Development Finance
Institutions in the province together with their product offerings;

Develop a clear Charter for the establishment of the Forum;

Develop feedback mechanisms and communication channels for
activities of all DFIs in the province in order to track trends on funding
SMMEs in the province
Strategic Priority 5.1.3: Establish a Provincial SMME Working
Group
The province has a myriad of SMME activities taking place and run by
different organisations and stakeholders. Government has funded SMME
support programmes, the private sector also runs its own programmes, some
District Municipalities have structured programmes and some don’t. This
creates problems for DEDEA whose role is to coordinate all activities
pertaining to SMME development in the province. In order to assist DEDEA
with the coordinating function, the following proposed activities are suggested:

Identify
all
Departments,
Chamber
Organisations,
Donor
Organisations, Private Sector Organisations, Research Institutions,
Institutions of Higher Learning, Agencies, etc to form part of the
Provincial SMME Working Group;

Create a database of all support programmes of these organisations
and distribute this information to entrepreneurs in the province;

Develop a coordination charter and reporting guidelines to the
provincial Legislature on an annual basis and align all these activities
to the Provincial SMME Strategy.
Strategic Priority 5.1.4: Establish an Enterprise Development
Agency in the Eastern Cape
Enterprise Development Agency relates to an institution that will facilitate the
provision of all other non-financial services to SMMEs other than financing.
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According to the research conducted by the Provincial Treasury in November
2005, an Enterprise Development Agency was proposed to assume the role
of the principle coordinating and facilitation agency of SMME services in the
province. This proposal is firmly supported by this Strategy. This is meant to
eliminate duplication of SMME assistance programmes by establishing an
effective network of various government and non-government SMME support
and assistance initiatives that will maximize provincial benefits by
complementing and/or leveraging their inputs and efforts.
SMME support in the Eastern Cape is heavy unregulated with nationally
based organisations like seda and UYF setting up offices in the province.
These organisations use the same private consultants and service providers
that are based in the province. The ECDC itself is involved in non-financial
support of SMMEs through consultants and service providers, possibly the
same as the ones above. A range of other provincial stakeholders like
Coega, EL IDZ, government departments, etc are also providing some form
of support to SMMEs. Clearly there is no firm control and full accountability
on the quality of services and even the credibility of service providers that
deliver such services. This arrangement necessitates that DEDEA takes full
control in ensuring that some form of order is brought about in the province.
In line with the suggestion advocated below of streamlining the mandate of
ECDC to mainly focus of access to finance issues for SMMEs, a case for the
establishment of the Agency which will also absorb ECDC’s non-financial
services programmes and bring about the much needed control is stronger.
This strategy proposes the following activities for medium to long term:

Commission a feasibility study for the new Enterprise Development
Support Agency;

Commission an impact study and audit of all business development
service programmes by other state organisations operating in the
province including the relevance of their service offerings, this will
include activities of seda since its establishment in the province;
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
Table both reports in the Provincial Legislature in order to solicit
approval and budget for the establishment of the Agency;

Develop a business plan and governance structure of the Agency and
its relationship to existing organisations.
Strategic Priority 5.1.5: Establish an Innovation Hub to
enhance product development and manufacturing in the
Province
Discussions with the EL IDZ revealed that plans are at an advanced stage to
establish an Innovation Hub within the IDZ. The Hub is meant to support
entrepreneurs to innovate and develop new products linked to the growing
economic sectors of the economy of the province in order to enhance
manufacturing. This is a much needed service in the province because we
discovered that most SMMEs that we interacted with during consultations
were not operating into the mainstream of the economy. They are largely
survivalist, struggling, with no hope of playing to the economic space of the
21st century. It is up to DEDEA and interested stakeholders like the EL IDZ to
resource and finance the establishment of the Hub. The following key
activities are proposed to drive this process:

Finalise the business plan, budget and governance structures of the
Innovation Hub;

Finalise the Industrial Strategy of the province in order to highlight
opportunities within the economic sectors of the province;

Establish the Innovation Hub within the EL IDZ and link it with Industry;
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1.2 Strategy Pillar Two: SMME Programme Design
and Support
Strategic Priority 5.2.1: Increase Supply of Financial Services
Results of the survey that was done as part of this process revealed that from
a sample 204 SMMEs surveyed at least 78% received start up funds from
personal savings, family, friends and relatives. A further 21% received funds
from a combination of both government and Development Finance
Institutions. Specific to the Development Finance Institutions, ECDC only
advanced funds to 0.5% of the SMMEs surveyed. At least 78.5% of SMMEs
that were surveyed also revealed that their financial requirements are for
equipment purchase and daily operations with about 15% requiring funds for
land and building.
Results of the workshops that were held with SMME in the regions revealed
the following issues pertaining access to finance for SMME development in
the Eastern Cape: lack of collateral and security, credit bureau & credit
worthiness issues of entrepreneurs, high interest rates on loans, the need for
alternative to collateral, stringent requirements for access, etc. These issues
are the main access to finance challenges that SMMEs in the Eastern Cape
are facing.
Our interviews with banks revealed similar issues about entrepreneurs in the
Eastern Cape including the following: SMMEs have no security or collateral,
poor quality of business plans, markets are not well researched, SMME
owners are not credit worthy, etc. In dealing with the issues mentioned above,
the following is therefore proposed:
 DEDEA to give a strictly dedicated SMME financing mandate to ECDC
in the province through the revision of the ECDC Act of 1997;
 Design incentives to encourage manufacturing by SMMEs in line with
the growing sectors as identified in the approved Industrial Strategy;
 Develop
Memoranda
of
Understanding
with
nationally
based
Development Finance Institutions (Khula, NEF, NYDA , DBSA, IDC) in
order to share reports on what kinds of SMMEs they are financing in
the EC, what sectors and challenges they constantly experience;
 Create a Service Level Agreement with local Banks to create an SMME
Fund that will cater for Medium to Large Enterprises in the province;
 Create funding products within the ECDC to finance small and medium
enterprises as defined in the Small Business Act of 1996 as amended
in 2004;
 Create a Service Level Agreement with SAMAF to finance enterprise
development activities micro and survivalist entrepreneurs in the
province;
 Create a database of Donor Organisations supporting SMMEs in the
province and what their service and product offerings.
Strategic Priority 5.2.2: Increase Supply of Non-Financial
Services
Access to non-financial services is one of the most important aspects for any
SMME. Non financial services also cover a myriad of needs that SMMEs have
and lack of one or the other might be the result of success or failure. The
banks lack of appetite in financing SMMEs in a large scale is because of poor
quality of business plans that come through their doors and that leaves them
with no choice but reject most of them on a frequent basis. SMMEs on the
other hand lament about the poor quality of services that they receive on a
frequent basis from service providers.
The survey that we did showed that SMMEs in the Eastern Cape possess low
levels of education and skills, therefore by their very nature they are heavily
dependent on government to support them for non-financial support services.
The survey also revealed the following as major causes of failure of SMMEs:
poor business management (32.8%), lack of finance (29.3%), lack of support
from service providers (12.6%), poor business marketing (12.1%).
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Given the above and host of other challenges that SMMEs face, the following
proposals are put forward:

DEDEA should establish a forum of state organisations that support
SMMEs in the province in order to create a co-ordination platform;

Develop a grading system for evaluating service providers and
consultants that assist SMMEs in order to ensure quality of service
provision;

Develop a capacity building programme for service providers working
with Institutions of Higher Learning in the province in order to assist
service providers to improve the quality of their services,

In the interim, develop monitoring tools for existing state organisations
in order to measure their impact on SMMEs in the province.

Review the working arrangement between DEDEA and seda in order
to focus on specific outcomes
Strategic Priority 5.2.3: Increase Demand for Products and
Services of SMMEs (Access to Markets through Government
Procurement)
It is now a Cabinet decision to procure goods and services from SMMEs. This
decision was taken with a condition that all government procurement policies
will be modified in line with the targets set out by government. A list of
products and services to be procured from SMMEs has already been
published and this has also been reiterated again in the 2009 Presidential
State of the Nation Address. In order to give full effect to enhancing demand
for SMME products and services, the following is proposed:
 DEDEA and Provincial Treasury to develop and issue a Policy
Directive on procurement targets from SMMEs in the province;
 Provincial Treasury to issues a Policy Directive to modify and review all
Supply Chain Policies across all spheres of government to recognise
targets set on procuring from SMMEs;
 Develop a Management Information System to monitor and publish
progress and reports on procuring from SMMEs;
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SMME Strategy Framework
 Monitor government spending on general procurement from SMMEs
and also set aside products as approved by Cabinet in November
2007;

A reliable database of SMMEs in the province needs to be developed
by DEDEA working with CIPRO in order to provide information about
their existence, capacity and their capability to provide goods and
services to government;
Strategic Priority 5.2.4: Increase Access to Markets to
Industry Opportunities for SMMEs
Mainstreaming SMMEs into the economy of the Eastern Cape is the ultimate
vision that should be pursued vigorously if the province is to realise mass
based self employment creation and broad based economic empowerment of
its citizens. This can only be possible if and when the Industrial Strategy of the
province is completed and adopted, economic sector studies are completed,
economic sector value chains are completed and opportunities for SMMEs in
each sector are clearly identified. In order to ensure facilitation of industry
opportunities for SMMEs, the following is proposed to be undertaken:

Finalise the Industrial strategy, conduct economic sector studies and
value chains in order to identify opportunities in the industry for SMME
development;

Develop products that are informed by market research of each sector
and show uniqueness of the Eastern Cape province;

Develop a Quality Improvement Support Programme in order to
enhance the quality and standards for products of SMMEs for
competitiveness;

Develop industry manufacturing incentives to ensure that barriers to
entry in industry are minimised and encourage industry to partner with
SMMEs;

Organising Outward Selling and Inward Buying Missions for SMMEs
through Investment Promotions;

Creating a platform for SMMEs to exhibit their products during the
Annual
Business
Week,
Grahamstown
Festival,
Exhibitions and Pavilions.
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International
Strategic Priority 5.2.5: Increase
Opportunities in the Eastern Cape
Access
to
Franchise
Franchising is undoubtedly one of the best models of owning an enterprise
largely because of its proven business model and support that normally goes
with acquiring a franchise. The Franchise Association of South Africa (FASA)
is a more than capable partner to advise and rollout the Franchise Support
Programme for the Province. This strategy proposes the following
interventions for promoting entrepreneurship through franchising in the
province:

Organise Annual Franchise Expos in the province in partnership with
FASA to expose and market franchise opportunities and encourage
entrepreneurs to take them up;

Develop a Franchise Fund to finance needy entrepreneurs who would
be interested in taking up franchise opportunities;

Provide ongoing education, information and advice on franchising
through the information centres across the province.
Strategic Priority 5.2.6: Skills Enhancement of SMME Owners
The managers and owners of SMMEs surveyed were almost split into half
between those that have attended one form of training or another and those
that have not attended any training at all. On average 48% have not attended
training at all and 49% have attended some form of business training. This
clearly shows that there is a considerable amount of entrepreneurs who have
not been exposed to any training whatsoever and that again can be a
determining factor of failure or success.
The other main issue is that the profile of SMME owners residing in the largely
rural Districts of the province, OR Tambo, Chris Hani and Alfred Nzo shows
that they posses matric qualifications and below. The picture is different in the
more urban areas Port Elizabeth, East London, Queenstown and so on with
owners of SMMEs possessing at least post matric qualifications. This is
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coupled by the lack of technical and business skills required to run their
businesses successfully. In order to close this gap, the following is suggested:
 Mobilise funds from the Setas and National Skills Fund in order to
finance technical skills training programmes to be implemented
through FET Colleges for SMME owners in the Eastern Cape;

Identify the required technical skills in line with the Industrial Policy of
the province and institutionalise those within FET Colleges and
institutions of Higher Learning;
 Utilise the expertise available with the institutions of Higher Learning in
the province to design and institutionalise SMME skills programmes
within their curricula.
Strategic Priority 5.2.7: Support to the Informal Sector and
Hawkers
The majority of attendees during our consultative workshops were owners of
small and micro enterprises across the province. It appears that, though this
sector is big in the province, there are no appropriate tools and support
programmes tailor made to deal with their specific challenges. Furthermore,
our consultations with the dti revealed that the informal sector also does not
fall within the current definition of SMME as embedded in the SMME Act of
1996 as amended in 2004. As big as this market is in the Eastern Cape, its
challenges are not being addressed. The strategy proposes the following:

DEDEA conduct a study of the specific needs, challenges and profile
of the informal sector in the Eastern Cape, if no such study exists;

Develop a Provincial Informal Business Support Programme for the
growth and sustainability of the informal sector across the province;

Create a Provincial Working Team comprising of DEDEA, Provincial
DPLG, District Municipalities, Organised Associations of the Informal
Sector to monitor the implementation of the Provincial Informal
Business Support;

Mobilise District and Local Municipalities to apportion budgets to
implement the support programme mentioned above.
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Strategic Priority 5.2.8:
Formations of SMMEs
Support
to
Organised
Business
One of the biggest limitations to the growth and sustainability of SMMEs is
their inability to network and support each other. During consultations with
SMMEs in District Municipalities it became clear that they do not know each
other, are not aware of economic opportunities in their areas, they are not
getting access to training and tender opportunities, they are not growing, they
do not network, etc. One of the main suggestions made during these
consultations was that SMMEs need to start organising themselves and
establish Business Associations. DEDEA does support the principle of
SMMEs organised but also insists that these Business Associations are to be
autonomous of government and fully owned by SMMEs themselves. This
Strategy hereby proposes the following support programmes:

Co-facilitate
networking
sessions
of
SMMEs
in
the
District
Municipalities;

Develop and Structure Governance Programmes to capacitate
members who will manage these Business Associations;

Structure a series of networking sessions on an Annual basis between
these Business Associations and Private Sector in order to encourage
business linkages;
Strategic Priority 5.2.9: Access to SMME Information
Lack of access to SMME information came out strongly as a major challenge
facing SMMEs in the Eastern Cape during consultations. Information needs
range from basic referrals to support organisations and where they are, how
to tender, how to write a business plan, where to get a mentor, what’s
happening in other district and local municipalities, etc. In order to close this
gap, the following is proposed:

Develop a Web Based Information Management System to assist
SMMEs with information on tenders and market opportunities;
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SMME Strategy Framework

DEDEA to work with Municipalities to establish SMME Information
Corners in each Municipality and all Libraries in the province, using
the information in the portal to advise SMMEs;

DEDEA to finance a project of compiling a Provincial Newsletter
about SMME activities in the province.

Create SMME Information slots in local radio stations where
entrepreneurs can call for advise and information.
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5.3 Strategy Pillar Three: SMME Regulatory Functions and
Services
Strategic Priority 5.3.1: Reduce Small Business Regulatory
Constraints and Awareness
Small Businesses face a myriad of regulatory constraints that impede their
growth, functionality and development. Most of these relate to issues of
Municipal By-Laws and Regulations. The strategy proposes the following:

A study needs to be undertaken to clearly identify and articulate such
regulatory constraints
that
impede
the
development
of
small
businesses and what measures can be implemented to lower those
burdens within the province;

An in-depth awareness and capacity building programme is necessary
for government officials, working with organisations like CIPRO in order
for them to advise small business owners on a continuous basis about
regulatory issues;

Municipal By-Laws and Regulations also need to be identified and
dealt with in order to create an enabling environment for SMMEs at a
local level.
Strategic Priority 5.3.2: Capacity Building of Municipality
Officials on Regulations affecting SMMEs and how to manage
them
SMMEs also suffer tremendously from the harsh treatment they receive from
Municipalities that fall within their jurisdictions. Municipal By-Laws and
regulations also impact negatively on the day to day management of SMMEs.
On municipal regulations, the Department of Co-operative Governance has
developed a set of tools that seek to assist Municipalities ease the regulations
and by-laws that impact negatively on SMMEs. The following proposals are
hereby canvassed to assist in dealing with this issue:
42 | P a g e
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
DEDEA to work with District Municipalities and the Department of Cooperative Governance to conduct a local Business Climate Surveys.
Templates already exist in the dti and the Department of Co-operative
Governance;

Conduct workshops with all LED Officials of Municipalities on the
SMME Local Redtape Reduction Process using manuals developed by
GTZ;

Compile a list of regulations and laws affecting SMMEs per District
Municipality in the province;

DEDEA and the Department of Co-operative Governance to develop a
set of policy proposals to address the regulatory issues affecting the
growth of SMMEs in the province.
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SMME Strategy Framework
5.4 Strategy Pillar Four: Monitoring and Evaluation
(Policy Coordination and Strategy Implementation)
Strategic Priority 5.4.1: Conducting Ongoing Research about
SMMEs in the Province
The importance of knowledge and access to relevant information cannot be
over-emphasised. Currently, DEDEA as a central department mandated to
handle issues of SMME development is not able to confidently give reliable
information about SMMEs in the province. The strategy proposes the
following in the area of research:

DEDEA should collate all available research report about SMMEs in
the province and establish a manner of ascertaining its relevance and
how it could be used to strengthen SMME Policy and Programme
implementation going forward;

An Information Management System needs to be put in place to store
and manage research and other future research agendas;

An immediate research exercise on “The State of the Informal Sector in
the Eastern Cape” needs to be conducted;

An immediate research exercise on “The Regulatory Impact of Small
Business in the Eastern Cape” also needs to be conducted;

An immediate exercise of developing a reliable Database of SMMEs in
the Eastern Cape also needs urgent attention;

At the end of each financial year, a “State of Small Business Review”
should be undertaken in the province;

Lastly, we propose that Institutions of Higher Learning should be
engaged by DEDEA in research and long term agreements should be
signed with them to produce these periodic research reports for the
province about SMME development.
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SMME Strategy Framework
Strategic Priority 5.4.2: Align and Integrate all the District and
Metro SMME Strategies with the Provincial Strategy
Framework
Our investigations and consultations also showed that the province has a
skewed distribution of programmes that provide support to SMMEs. Some
programmes are structured and some are not. The most important
observation though is that out of six District Municipalities and a Metro, only
three District Municipalities have in place structured District SMME Strategies.
The inconsistencies created by this anomaly is that SMME largely based in
rural areas remain poor and with no access to services, though those based
in urban and semi-urban areas are receiving some support or the other. This
strategy proposes the following:

Develop guidelines for District Municipalities for developing their SMME
Strategies and Programmes

Partner with the District Municipalities to develop monitoring guidelines
across the province on SMME support

Partner with the District to identify programmes and projects related to
supporting SMMEs for joint funding with DEDEA
Strategic Priority 5.4.3: Developing Knowledge and Information
about SMMEs to inform Policy and Programmes in the Province
Government realises the importance of knowledge management in informing
refinement of policy and programme implementation. It is for this reason that
this strategy proposes the following:

Partnerships with Institutions of Higher Learning (Fort Hare, Walter
Sisulu and others) is important because of their capacity to write and
document, their ability to research and their importance to educate the
society;

Knowledge
Management
Seminars
on
SMME
Development,
production of Periodic Papers about SMMEs in the province and
Regional SMME Summits and Conferences are critical in informing
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SMME Strategy Framework
government about the goings on in the province, and these should be
outsourced to Institutions of Higher Learning and lessons documented;
Strategic Priority 5.4.4: Hosting Annual Conferences, Seminars
and Summits on SMME Development in the Province
The Eastern Cape is a very big province and most of the time it is difficult to
know what the SMME activities of each District are. It is also important to
create platforms for networking amongst SMMEs within their own Districts. To
encourage this interaction, the strategy proposes the following:

All District Municipalities should host District SMME Summits to
discuss issues relating to how SMMEs should be integrated into the
economies of the Districts;

An Annual Provincial SMME Conference should be organised by
DEDEA where all District SMME Summit Reports are tabled and
common policy issues are discussed and resolutions taken;

An Annual Provincial Franchise Expo should be organised by DEDEA
in partnership with Franchise Association of South Africa and other
interested parties like banks, IDC, Business Partners and so on.
Strategic
Priority
5.4.5:
Ongoing
Monitoring
of
the
Implementation of the Provincial SMME Strategy
Monitoring is a continuing function that aims primarily to provide early
indications of progress, or lack thereof, in the achievement of objectives.
Monitoring helps to identify and assess potential successes and challenges
and provides the basis for corrective actions to improve implementation and to
obtain quality results. The most important issue about monitoring is what
needs to be monitored in order to come up with relevant monitoring tools
relevant to this Strategy.
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SMME Strategy Framework
As already mentioned above, what needs monitoring is the objective of the
strategy, the achievement of its pillars and its strategic priority areas. In
designing a monitoring tool, DEDEA should consider answering the following
questions, making an example with only the first objective:

Has DEDEA employed the staff of the Chief Directorate?

Has the Provincial Legislature Adopted the new ECDC Act?

How many times has the Coordination Forum met?

Is the Management of the Enterprise Development Agency
employed?
Monitoring tools are easy to develop is the strategy is clear, the objectives are
clear, anticipated outcomes are clear, resources are allocated and the
systems are in place. This is the responsibility of DEDEA and its implementing
agency to develop, but most importantly the implementation of this particular
strategy is going to require political will from the provincial government of the
Eastern Cape.
Strategic Priority 5.4.6: Evaluation of the Strategy
Evaluation is a time-bound task that attempts to assess systematically and
objectively the relevance, performance and success of ongoing or completed
projects. It is a process by which the project inputs, activities and results are
analysed and judged against explicitly stated norms – objectives, work
schedule, budget etc.
The evaluation of this strategy will take the form of annual evaluations to be
contracted out to independent service providers and to be managed by
DEDEA. The terms of reference for all evaluations should be in line with the
business plans and activities planned for SMME development. The reports
should assist in fine tuning implementation activities and identify more
challenges and opportunities.
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SMME Strategy Framework
SECTION SIX: IMPLEMENTATION PLAN
OBJECTIVE 3.2.1:
To provide for the establishment of appropriate institutional support framework in
the province of the Eastern Cape for SMMEs to be mainstreamed into the provincial economy
5.1 STRATEGY PILLAR ONE:
STRATEGIC PRIORITIES
5.1.1 Develop Capacity with
DEDEA
5.1.2 Establish a Forum for
Development Finance
Institutions
SMME INSTITUTIONAL FRAMEWORK
ACTIVITIES
The functions of the Regional Staff should be redefined
in line with the implementation of the SMME Strategy
Regional staff need to be trained in Policy
Development, Monitoring and Evaluation, SMME Policy
and Legislation and Research
DEDEA Head Office should apportion a budget for each
Regional Office for SMME projects in order to support
Municipalities with matters that relate to SMME
research, awareness programmes, information
dissemination and monitoring activities of the Provincial
SMME Strategy
Develop a complete database of all the existing
Development Finance Institutions in the province
together with their product offerings;
Develop a clear Charter for the establishment of the
Forum;
Develop feedback mechanisms and communication
channels for activities of all DFIs in the province in
order to track trends on funding SMMEs in the province
RESPONSIBILITY
Head of Department of
DEDEA
PERFORMANCE
INDICATORS
New Approved
Performance Contracts
MEANS OF
VERIFICATION
Signed Contracts
Training Reports
Training Programmes
attended
Business Plans with
Budgets
Approved Regional Office
Budgets and Business
Plans
DEDEA
Database developed
Database
Forum Established
Minutes of Forum
Meetings
Reporting Guidelines
Developed
Performance Reports
STRATEGIC PRIORITIES
5.1.3 Establish a Provincial
SMME Working Group
5.1.4 Establish an Enterprise
Development Support Agency
5.1.5 Establish an Innovation
Hub to enhance product
development and
manufacturing
49 | P a g e
ACTIVITIES
Identify all Departments, Chamber Organisations,
Donor Organisations, Private Sector Organisations,
Research Institutions, Institutions of Higher Learning,
Agencies, etc to form part of the Provincial SMME
Working Group;
Create a database of all support programmes of these
organisations and distribute this information to
entrepreneurs in the province;
Develop a coordination charter and reporting guidelines
to the provincial Legislature on an annual basis and
align all these activities to the Provincial SMME
Strategy.
Commission a feasibility study for the new Enterprise
Development Support Agency
Commission an impact study of business development
service provision by other state organisations operating
in the province including the relevance of their service
offerings
Table both reports in the Provincial Legislature in order
to solicit approval and budget for the establishment of
the Agency
Develop a business plan and governance structure of
the Agency and its relationship to existing organisations
Finalise the business plan, budget and governance
structures of the Innovation Hub;
Finalise the Industrial Strategy of the province in order
to highlight opportunities within the economic sectors of
the province;
Establish the Innovation Hub within the EL IDZ and link
it with Industry
SMME Strategy Framework
RESPONSIBILITY
DEDEA
Provincial SMME
Stakeholders
PERFORMANCE
INDICATORS
MEANS OF
VERIFICATION
Complete Database of
SMME Stakeholders and
services developed
SMME Working
Group Database
SMME Working Group
established
SMME Working Group
Guidelines and
Reporting Templates
developed
DEDEA Head Office
Feasibility Study
Completed
SMME Working
Group Meeting
Minutes
SMME Working
Group Reports
Feasibility Study
Report
ECSECC
Impact Study Completed
Impact Study Report
DEDEA Head Office
EL IDZ
Institutions of Higher
Learning
Industry Organisations
and Chamber
Organisations
Legislature
Approval Secured
Legislature Memo and
Minutes
Business Plan and
Budget Approved
Business Plan and
Budget of the Innovation
Hub Complete
Business Plan
Document
Business Plan
Document
Innovation Hub
Physical Structure of the
Innovation Hub erected
OBJECTIVE 3.2.2:
To provide better access to existing and the development of new SMME support
programmes in the Eastern Cape;
5.2 STRATEGIC PILLAR TWO: SMME PROGRAMME DESIGN AND SUPPORT
STRATEGIC PRIORITIES
ACTIVITIES
RESPONSIBILITY
PERFORMANCE
INDICATORS
MEANS OF
VERIFICATION
5.2.1 Increase Supply of
Financial Services
DEDEA to give a strictly dedicated SMME financing
mandate to ECDC in the province through the revision
and amendment of the ECDC Act of 1997;
Design incentives to encourage manufacturing by
SMMEs in line with the growing sectors as identified in
the approved Industrial Strategy;
Develop Memoranda of Understanding with nationally
based Development Finance Institutions (Khula, NEF,
NYDA , DBSA, IDC) in order to share reports on what
kinds of SMMEs they are financing in the EC, what
sectors and challenges they constantly experience;
Create a Service Level Agreement with local Banks to
create an SMME Fund that will cater for Medium to
Large Enterprises in the province;
Create funding products within the ECDC to finance
small and medium enterprises as defined in the Small
Business Act of 1996 as amended in 2004;
Create a Service Level Agreement with SAMAF to
finance enterprise development activities micro and
survivalist entrepreneurs in the province;
Create a database of Donor Organisations supporting
SMMEs in the province and what their service and
product offerings
DEDEA Head Office
ECDC Act Reviewed
New ECDC Act
ECDC
Manufacturing Incentives
Developed
Signed Agreements
with Banks
Memo of Understanding
with DFIs signed
Approved Incentive
Packages
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Local Banks
Development Finance
Institutions
Service Level
Agreements signed
Donor Organisations
database and services
developed
STRATEGIC PRIORITIES
ACTIVITIES
RESPONSIBILITY
5.2.2 Increase Supply of NonFinancial Services
DEDEA should develop a database of state
organisations that support SMMEs in the province in
order to create a co-ordination platform
Develop a grading system for evaluating service
providers and consultants that assist SMMEs in order to
ensure quality of service provision
Develop a capacity building programme for service
providers working with Institutions of Higher Learning in
the province in order to assist service providers to
improve the quality of their services,
In the interim, develop monitoring tools for existing state
organisations in order to measure their impact on
SMMEs in the province
DEDEA Head Office
Institutions of Higher
Learning
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DEDEA and Provincial Treasury to develop and issue a
Policy Directive on procurement targets from SMMEs in
the province
Provincial Treasury to issues a Policy Directive to
modify and review all Supply Chain Policies across all
spheres of government to recognise targets set on
procuring from SMMEs
Develop a Management Information System to monitor
and publish progress and reports on procuring from
SMMEs
Monitor government spending on general procurement
from SMMEs and also set aside products as approved
by Cabinet in November 2007
A reliable database of SMMEs in the province needs to
be developed by DEDEA working with CIPRO in order
to provide information about their existence, capacity
and their capability to provide goods and services to
government
SMME Strategy Framework
MEANS OF
VERIFICATION
Database Booklet
Grading System
Training Programmes
Grading System for
Service Providers
completed
Capacity Building
Programmes for Service
Providers development
and institutionalised
Review the working arrangement between
DEDEA and seda in order to focus on specific
outcomes
5.2.3 Access to Markets
through Government
Procurement
PERFORMANCE
INDICATORS
Database of state
organisations and their
service offerings
developed
Monitoring Reports
Signed seda Service
Level Agreement
New seda Service Level
Agreement with DEDEA
DEDEA Head Office
Provincial Treasury
Policy Guidelines on
Procurement Targets
developed
Government Gazettes
Policy Guidelines on
amending all Supply
Chain Management
Policies developed and
issued
Provincial SMMEs
Database
Communication on the
policy guidelines across
government completed
MIS completed
Database developed
MIS Reports
STRATEGIC PRIORITIES
ACTIVITIES
RESPONSIBILITY
5.2.4 Enhance Access to
Markets to Industry
Opportunities for SMMEs
Finalise the Industrial strategy, conduct economic
sector studies and value chains in order to identify
opportunities in the industry for SMME development;
Develop products that are informed by market research
of each sector and show uniqueness of the Eastern
Cape province;
Develop a Quality Improvement Support Programme in
order to enhance the quality and standards for products
of SMMEs for competitiveness;
Develop industry manufacturing incentives to ensure
that barriers to entry in industry are minimised and
encourage industry to partner with SMMEs;
Organising Outward Selling and Inward Buying
Missions for SMMEs through Investment Promotions;
Creating a platform for SMMEs to exhibit their products
during the Annual Business Week, Grahamstown
Festival, International Exhibitions and Pavilions.
Organise Annual Franchise Expos in the province in
partnership with FASA to expose and market franchise
opportunities and encourage entrepreneurs to take
them up;
Develop a Franchise Fund to finance needy
entrepreneurs who would be interested in taking up
franchise opportunities
Provide ongoing education, information and advice on
franchising through the information centres across the
province
DEDEA
5.2.5 Increase Access to
Franchise Opportunities in the
Eastern Cape
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SMME Strategy Framework
PERFORMANCE
INDICATORS
Industrial Strategy
Approved
Sector Studies with Value
Chains Completed
Partnership with SABS
approved
MEANS OF
VERIFICATION
Industrial Strategy
Sector Studies
Reports
Signed Agreement
with SABS
Exhibitions Reports
Number of Exhibitions
attended by SMMEs
Buying and Selling
Mission Reports
DEDEA Head Office
Franchise Association of
South Africa
Local Banks
Annual Franchise Expo
held
Franchise Expo
Report
Franchise Fund proposal
approved
Franchise Fund
Proposal
STRATEGIC PRIORITIES
ACTIVITIES
RESPONSIBILITY
5.2.6 Skills Enhancement of
SMME Owners
Mobilise funds from the Setas and National Skills Fund
in order to finance technical skills training programmes
to be implemented through FET Colleges for SMME
owners in the Eastern Cape
Identify the required technical skills in line with the
Industrial Policy of the province and institutionalise
those within FET Colleges and institutions of Higher
Learning
Utilise the expertise available with the institutions of
Higher Learning in the province to design and
institutionalise SMME skills programmes within their
curricula.
DEDEA Head Office
DEDEA
conduct a study of the specific needs,
challenges and profile of the informal sector in the
Eastern Cape, if no such study exists
Develop a Provincial Informal Business Support
Programme for the growth and sustainability of the
informal sector across the province
Create a Provincial Working Team comprising of
DEDEA, Provincial DPLG, District Municipalities,
Organised Associations of the Informal Sector to
monitor the implementation of the Provincial Informal
Business Support
Mobilise District and Local Municipalities to apportion
budgets to implement the support programme
mentioned above.
DEDEA Head Office
5.2.7 Support the Informal
Sector and Hawkers
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Depart of Education and
Labour, SETAs, etc
FET Colleges
PERFORMANCE
INDICATORS
Skills Audit Study
completed
Skills programmes
institutionalised with FET
Colleges and institutions
of Higher Learning
MEANS OF
VERIFICATION
Skills Audit Report
SMME Skills
Programmes
Institutions of Higher
Learning
Municipalities
Study on the Informal
Sector in the Eastern
Cape completed
Organised Formations of
Informal Businesses
Informal Business
Support Programme
Study Report
Support Programme
Document
STRATEGIC PRIORITIES
ACTIVITIES
RESPONSIBILITY
5.2.8 Access to SMME
Information
Develop a Web Based Information Management
System to assist SMMEs with information on tenders
and market opportunities
Partner with Municipalities and libraries across the
province to establish SMME information corners that
will be used to provide information to SMMEs across
the province
Develop an informative newsletter about SMME
activities and programmes in the Eastern Cape
Partner with local and provincial radio stations to
develop SMME interactive radio slots
DEDEA
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SMME Strategy Framework
PERFORMANCE
INDICATORS
Website Developed and
Functioning
MEANS OF
VERIFICATION
Website
Information Corners
Information Corners
established in
Municipalities
Newsletter
Radio Slots
Newsletter Developed
Radio Station
Programmes Secured
and taking place
OBJECTIVE 3.2.3:
To create an enabling environment for SMME to thrive in the province by
conducting continuous policy and strategy reviews in the Eastern Cape
5.3 STRATEGIC PILLAR THREE: SMME REGULATORY FUNCTIONS AND SERVICES
STRATEGIC PRIORITIES
ACTIVITIES
RESPONSIBILITY
PERFORMANCE
INDICATORS
MEANS OF
VERIFICATION
5.3.1 Reduce Small Business
Regulatory Constraints and
Awareness
Work with Municipalities to identify regulatory
constraints that impede the development of SMMEs in
the province
Compile these regulatory constraints into a reports in
order to review policies that provide constraints and
create an enabling environment
Train and provide awareness of regulatory constraints
to SMME development
Develop Policy measures to deal with the Regulatory
Constraints
DEDEA to work with District Municipalities and the
Department of Co-operative Governance to conduct a
Local Business Climate Surveys. Templates already
exist in the dti and the Department of Co-operative
Governance;
Conduct workshops with all LED Officials of
Municipalities on the SMME Local Redtape Reduction
Process using manuals developed by GTZ;
Compile a list of regulations and laws affecting SMMEs
per District Municipality in the province;
DEDEA and the Department of Co-operative
Governance to develop a set of policy proposals to
address the regulatory issues affecting the growth of
SMMEs in the province
DEDEA Head Office
Regulatory Review
process completed
Regulatory Review
Report
Policy development
process completed
Policy Proposals
Document
Local Business Surveys
for all Districts completed
Reports of Surveys
5.3.2 Capacity Building of
Municipality Officials on
Regulations affecting SMMEs
and how to manage them
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SMME Strategy Framework
Municipalities
DEDEA
Department of Cooperative Governance
District Municipalities
Reports of Workshops
Workshops with
Municipality Officials
completed
.
OBJECTIVE 3.2.4:
To provide for better collation, monitoring and reporting about SMME development
in the province through continuous research and knowledge management
5.4 STRATEGIC PILLAR FOUR: Monitoring and Evaluation (Policy Coordination & Strategy implementation)
STRATEGIC PRIORITIES
ACTIVITIES
RESPONSIBILITY
PERFORMANCE
INDICATORS
MEANS OF
VERIFICATION
5.4.1 Conducting Ongoing
Research about SMMEs in the
province
Commission a thorough study of SMMEs in the Eastern
Cape and also collate available research in the
province about SMMEs in order to strengthen the
strategy implementation process
Develop an Information Management System to
manage data available about SMMEs in the province
An immediate research exercise on “The State of the
Informal Sector in the Eastern Cape” needs to be
conducted;
An immediate research exercise on “The Regulatory
Impact of Small Business in the Eastern Cape” also
needs to be conducted;
An immediate exercise of developing a reliable
Database of SMMEs in the Eastern Cape also needs
urgent attention;
At the end of each financial year, a “State of Small
Business Review” should be undertaken in the province
Create a partnership with Institutions of Higher Learning
in the province in order to produce data and research
about SMMEs in the province
DEDEA Head Office
State of SMMEs in the
Eastern Cape Research
completed
State of SMMEs in the
Eastern Cape Report
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Institutions of Higher
Learning
Service Providers
SMME Regulatory
Constraints Research
Completed
A Database development
exercise completed
Management Information
System developed
Regulatory Review
Report
Management
Information System
Database of SMME
Research Reports
STRATEGIC PRIORITIES
ACTIVITIES
RESPONSIBILITY
5.4.2: Align and Integrate all
the District and Metro SMME
Strategies with the Provincial
Strategy Framework
Develop guidelines for District Municipalities for
developing their SMME Strategies and Programmes
Partner with the District Municipalities to develop
monitoring guidelines across the province on SMME
support
Partner with the District to identify programmes and
projects related to supporting SMMEs for joint funding
with DEDEA
DEDEA Head Office
Partnerships with Institutions of Higher Learning (Fort
Hare, Walter Sisulu and others) is important because of
their capacity to write and document, their ability to
research and their importance to educate the society
Knowledge Management Seminars on SMME
Development, production of Periodic Papers about
SMMEs in the province and Regional SMME Summits
and Conferences are critical in informing government
about the goings on in the province, and these should
be outsourced to Institutions of Higher Learning and
lessons documented
Host an Annual Provincial SMME Conference
DEDEA
Assist the Districts to hold SMME Summits for SMMEs
in their District Municipalities and the Metro
District Municipalities
5.4.3: Developing Knowledge
and Information about SMMEs
to inform Policy and
Programmes in the Province
5.4.4 Host Annual SMME
Conferences, Summits and
Seminars
DEDEA Regional Offices
District Municipalities
Institutions of Higher
Learning
DEDEA Head Office
PERFORMANCE
INDICATORS
Provincial SMME
Strategy process
completed
Guidelines for District
Municipalities completed
MEANS OF
VERIFICATION
Provincial SMME
Strategy
6 District
Municipalities SMME
Programmes
All District Municipalities
SMME Programmes
presented in a provincial
SMME Summit
Annual Paper about
SMME Development in
the province produced
1 Metro SMME
Programme
Annual SMME
Conference held
Conference Report
6 District Municipalities
Summits held
SMME Papers and
Repors
6 District
Municipalities SMME
Summit Reports
Host an Annual Franchise Expo
1 Franchise Expo held
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SMME Strategy Framework
Franchise Expo
Report
STRATEGIC PRIORITIES
ACTIVITIES
RESPONSIBILITY
5.4.5 Ongoing Monitoring of the
implementation of the
Provincial SMME Strategy
Develop Monitoring Guidelines for this SMME Strategy
DEDEA Head Office
5.4.6 Evaluation of the SMME
Strategy
Develop Evaluation Guidelines upfront for this SMME
Strategy
Produce and present reports on the progress in
implementing the SMME Strategy
Commission independent Evaluations of the Strategy
Develop Terms of Reference for the Impact Evaluation
of the SMME Strategy every 3 years
Outsource to an independent contractor to manage the
process of an evaluation of the implementation of the
strategy
Manage the service provider to conclude the process
and produce a report
;
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SMME Strategy Framework
DEDEA
PERFORMANCE
INDICATORS
Monitoring reports
produced on an ongoing
basis
Evaluation of the
Strategy is conducted on
an annual basis
Terms of Reference
developed
Service Provider Contract
signed
MEANS OF
VERIFICATION
Monitoring Reports
Evaluation Reports
Signed Terms of
Reference
Signed Contract
Final Report
Impact Evaluation
Reports Completed