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A framework for acquiring the resources vital for the start-up of a business in South Africa:an African Immigrant’s Perspective

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  • Tengeh, Robertson Khan
  • Ballard, Harry
  • Slabbert, Andre

Abstract

Using a triangulation of three methods, we devise a framework for the acquisition of the resources vital for the start-up of a business in South Africa. Against the backdrop of the fact that numerous challenges prohibit African immigrants from starting a business, let alone growing the business, we set out to investigate how those who succeed acquired the necessary resources. Within the quantitative paradigm, the survey questionnaire was used to collect and analyze the data. To compliment the quantitative approach, personal interviews and focus groups were utilised as the methods within the qualitative approach paradigm. The research revealed that an African immigrant entrepreneur is most likely to be a male between the ages of 19 and 41 who has been forced to immigrate by political circumstances. Once in South Africa, limited job opportunities forced these immigrants into starting-up a business. In order of importance, financial, informational, human and physical, resources were identified as being critical for the start-up a business. With respect to the acquisition of resources, African immigrant entrepreneurs unwillingly made use of personal savings to finance their businesses during the start-up phase of the business. Financial resource played a double role in that it determined the main sources of physical resources used. From a human resource perspective, African immigrant entrepreneurs preferred employing South Africans during the start-up phase of the business, and the reverse was true during the growth phase. To a limited extent family labour was involved at both the start-up as well as the operation phases of the business; with formal education and prior experience playing an indirect role as far as the human resources mixed were concerned. In terms of information, African immigrant entrepreneurs made use of two primary sources of information namely; their ethnic networks and friends from somewhere else.

Suggested Citation

  • Tengeh, Robertson Khan & Ballard, Harry & Slabbert, Andre, 2011. "A framework for acquiring the resources vital for the start-up of a business in South Africa:an African Immigrant’s Perspective," MPRA Paper 34211, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:34211
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    File URL: https://mpra.ub.uni-muenchen.de/34211/2/MPRA_paper_34211.pdf
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    References listed on IDEAS

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    1. Robert W. Fairlie & Bruce D. Meyer, 2003. "The Effect of Immigration on Native Self-Employment," Journal of Labor Economics, University of Chicago Press, vol. 21(3), pages 619-650, July.
    2. Gries, Thomas & Naude, Wim, 2008. "Entrepreneurship and Regional Economic Growth: Towards A General Theory of Start-Ups," WIDER Working Paper Series 070, World Institute for Development Economic Research (UNU-WIDER).
    3. George J. Borjas, 1994. "The Economics of Immigration," Journal of Economic Literature, American Economic Association, vol. 32(4), pages 1667-1717, December.
    4. Sonja Markova & Tatjana Petkovska-Mircevska, 2009. "Financing Options for Entrepreneurial Ventures," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 11(26), pages 597-604, June.
    5. Clark, Kenneth & Drinkwater, Stephen, 2000. "Pushed out or pulled in? Self-employment among ethnic minorities in England and Wales," Labour Economics, Elsevier, vol. 7(5), pages 603-628, September.
    6. Neil Rankin, 2006. "The Regulatory Environment and SMMEs. Evidence from South African Firm Level Data," Working Papers 06113, University of Cape Town, Development Policy Research Unit.
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    Cited by:

    1. Tengeh, RK & Ballard, HB & Slabbert, AS, 2012. "Do immigrant-owned businesses grow financially? An empirical study of African immigrant-owned businesses in the South Africa," MPRA Paper 40610, University Library of Munich, Germany.
    2. Tengeh, Robertson Khan & Ballard, Harry & Slabbert, Andre, 2011. "Financing the Start-up and Operation of Immigrant-owned Businesses: the path taken by African Immigrants in the Cape Town Metropolitan Area of South Africa," MPRA Paper 38405, University Library of Munich, Germany, revised 19 Dec 2011.

    More about this item

    Keywords

    South Africa; African immigrants; business start-up resources; SMMEs; framework; self employment;

    JEL classification:

    • A23 - General Economics and Teaching - - Economic Education and Teaching of Economics - - - Graduate
    • A11 - General Economics and Teaching - - General Economics - - - Role of Economics; Role of Economists

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