The state of business incubation in the Northern Cape: A service spectrum perspective

Abstract

Background: Business incubation has the purpose of recruiting weak yet promising tenant-entrepreneurs or incubates. The weaknesses may include a lack of skills and abilities, lack of resources or lack of knowledge. The business case or opportunity should be promising. Further to the purpose, business incubators attempt to turn these deficient businesses into sustainable entities that can exit or graduate the incubator and survive on their own devices. Without this intervention through the incubator, it is extremely unlikely that these tenant-entrepreneurs or incubates will survive. In order to achieve the maximum likelihood of successful graduate-entrepreneurs and sustainable start-ups, business incubators must offer a full spectrum of services. These services should include access to physical premises, communal equipment, administrative support, training for skills development, access to professional and specialised skills, access to financial support, access to networking and access to mentorship.

Objectives: It is the purpose of this study, firstly, to investigate and determine which of these services business incubators within the Northern Cape Province of South Africa offer. Secondly, it is the further purpose of this study to benchmark the incubators within the Northern Cape Province to international best practice models.

Method: A qualitative research methodology was employed in this study. Data were collected through semi-structured interviews, transcribed and analysed through qualitative software. The sample consisted of 63 respondents from 7 business incubators within the province. The sampling method was purposive.

Results: The research results obtained indicated that four incubators within the province boast a very weak service offering. Furthermore, only one incubator truly benchmarked competitively against international best practice models.

Conclusion: The study provides recommendation with regards to specialist mentoring, skills development and training of entrepreneurs and incubation-practitioners, as well as access to funding and physical upgrades of incubators. The research contributes to a very sparse body of existing research on small, medium and micro-enterprise (SMME) development within the Northern Cape Province. The study provides future research questions for academic researchers.