An investigation into small business failures with specific reference to retrenched Telkom employees in the far West Rand (Mogale city, Randfontein and Soweto)

摘要

This study examines the factors that contributed to the failure of retrenched Telkom workers to start and run successful businesses after the company had provided them with start-up capital and also funds for training. Many of the factors contributing to the majority of Telkom retrenched employees not establishing businesses will be identified and recommendations that companies could implement in the future to limit the failure of businesses of retrenched employees will be made. The study was descriptive, exploratory and qualitative in nature. Semi-structured interviews and a survey questionnaire specifically developed for this study were used to gather data. The study was conducted on ex-employees of Telkom residing in and around the townships and suburbs situated on the western side of Johannesburg (Mogale City, Randfontein and Soweto). Telkom provided retrenched employees with funds to attend external training so that they could be equipped to start and run their own businesses. Subsequently, Telkom also provided start-up capital so that these employees could start small businesses after they had left the company. Although the funds were provided, most employees did not utilise them to start their businesses and the few that did access the funds and start businesses experienced the failure of their businesses within a very short period of time. Three major issues of concern were identified: many of these ex-employees did not utilise the funds that were allocated for training; many did not make use of the start-up capital and the majority did not start businesses. The study investigated the following issues: a) Why the retrenched employees did not make use of the funds allocated for training b) Why the ex-employees did not make use of the start-up capital c) Why the ex-employees did not start businesses d) Of those that did start businesses, why did they fail within such a short period of time? The findings of the study confirm that most of the retrenched employees did not access either the training or the start-up funds. Detailed reasons for why the funds were not made use of are given and recommendations are also made for what the company should do in future if deciding to embark on a similar exercise.