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Impact of Municipal Regulations on SMMEs


  • AFReC
  • BEES
  • MCA

    () (AFReC, BEES, MCA)


The regulatory impact of municipalities on small enterprise is inextricably linked to their developmental and service delivery roles. A general lack of information about municipal regulations and their enforcement was also discerned among the small businesses interviewed. The most significant distinctions of four categories of micro, very small, small and medium enterprise are as follows: – Micro survivalist and micro non-survivalist businesses also classified as the informal sector. This category requires a specialised focus through standardised regulations and transparent and predictable service delivery arrangements. Where possible, targeted support for certain, highly viable micro businesses could assist them in becoming formalised and graduate to the very small status. – Very small businesses are on the threshold of becoming more established, small or medium enterprises. They are already formalised which means that the initial regulatory barrier posed through licensing and zoning applications has been crossed. This category requires municipal support in the form of business advice, training and reliable provision of utilities. – Small and medium enterprises stand to gain significantly from effective supply chain management policies of municipalities that rely on unbundling of larger projects, capacity building of businesses and regular monitoring and evaluation of the regulatory environment. A range of recommendations to enhance municipal regulatory role is offered in this paper.

Suggested Citation

  • AFReC & BEES & MCA, 2006. "Impact of Municipal Regulations on SMMEs," Working Papers 06107, University of Cape Town, Development Policy Research Unit.
  • Handle: RePEc:ctw:wpaper:06107

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    Cited by:

    1. De Lucia, Caterina & Bartlett, Mark, 2014. "Implementing a biofuel economy in the EU: Lessons from the SUSTOIL project and future perspectives for next generation biofuels," Renewable and Sustainable Energy Reviews, Elsevier, vol. 29(C), pages 22-30.

    More about this item


    South Africa: small enterprises; regulatory impact; municipal regulations;

    JEL classification:

    • A1 - General Economics and Teaching - - General Economics


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