PROSPECTS FOR DIGITAL TRANSFORMATION IN RURAL SOUTH AFRICA'S SMALL AND MEDIUM-SIZED ENTERPRISES

Abstract

The global wave of the coronavirus pandemic has constrained small, medium-sized enterprises to seek out ways to survive. The pandemic has propelled businesses to review their system of operation and embrace the endless benefits inherent in the digital world. However, there is a dearth of empirical studies on the propensities for digitalization in the context of rural-based SMEs in South Africa. To fix this gap, this paper explores the prospects for the digital shift among rural-based South African SMEs. A descriptive survey anchored in a quantitative research method was utilized using a Likert scale questionnaire as a tool for data collection, hence, thousand and sixty-seven (1067) SME owners operating in Ethekwini Municipality rural communities, KwaZulu-Natal province of South Africa were engaged as respondents. It was found that the major barriers to digital transformation amongst the small business owners in the rural setting include: the reluctance of SMEs owners to experiment with digital tools, the risk-aversive nature of the rural-based entrepreneurs, limited financial resources and inadequate awareness of available sector-specific digital tools. The outcome of this study further indicates that majority of rural-based South African SMEs are at risk of retrogressing due to inadequate knowledge of relevant digital tools with which they can enhance the level of competitiveness of their businesses. Thus, this paper advocates timeous succour for these SMEs in order to ensure their longevity. Recommendations and future research directions were also offered.