“South African township entrepreneurs are calling on political parties and local government candidates to reduce regulatory barriers, improve infrastructure and create an enabling environment for small businesses ahead of the local government elections. Township Entrepreneurs Alliance founder Bulelani Balabala says entrepreneurs need practical support, better access to digital tools and meaningful business development opportunities rather than funding programmes that fail to address their operational challenges.”
Township Entrepreneurs Demand Less Red Tape, Better Infrastructure and Greater Government Support Ahead of South Africa’s Local Elections
South Africa’s township entrepreneurs are urging political parties and local government candidates to make entrepreneurship, small-business development and economic inclusion central priorities as the country approaches its local government elections. Business owners operating in townships want practical reforms that will make it easier to establish businesses, access markets, obtain financing, use digital technologies and create sustainable employment.
The growing demand for support highlights the importance of township economies in South Africa’s broader economic development. Although townships are frequently viewed as consumer markets, entrepreneurs believe these communities have significant potential to become centres of production, innovation, manufacturing, distribution and job creation.
The issue was highlighted by Bulelani Balabala, founder of the Township Entrepreneurs Alliance (TEA), who says entrepreneurs want an enabling business environment rather than complicated regulations and ineffective development programmes.
According to a report published by TimesLIVE’s Business Times on Saturday, October 31, Balabala believes removing barriers to doing business should be a major responsibility of local government. Entrepreneurs are particularly interested in political leadership that understands the operational challenges facing township businesses and is willing to introduce policies that support their growth.
Township entrepreneurs want a business-friendly environment
For many entrepreneurs, establishing a business is only the beginning of a difficult journey. Operating legally, securing suitable premises, accessing electricity and water, managing municipal requirements and reaching customers can create additional challenges.
These obstacles can prevent promising businesses from expanding beyond informal or small-scale operations.
Township entrepreneurs are therefore calling for local governments to review municipal bylaws and administrative requirements that may unnecessarily restrict commercial activity.
Balabala argues that townships should not be considered places where people only purchase goods and services. Instead, they should be recognised as important economic environments where products are manufactured, services are delivered and businesses create employment.
This perspective is important because township entrepreneurs contribute to economic activity across numerous industries, including retail, food production, transport, construction, clothing, personal services, technology and manufacturing.
A supportive regulatory environment could allow more businesses to move from informal operations into established enterprises. It could also encourage entrepreneurs to invest in equipment, employ additional workers and develop products for customers beyond their immediate communities.
Consequently, local government policies will play an important role in determining whether township businesses remain small or develop into sustainable enterprises.
Infrastructure remains a major obstacle to business growth
One of the most significant concerns identified by the Township Entrepreneurs Alliance is the infrastructure gap affecting businesses in different communities.
According to Balabala, approximately 80% of entrepreneurs surveyed by the alliance identified infrastructure disparities as a challenge in the areas where they operate.
Infrastructure is essential to almost every commercial activity. Reliable electricity, accessible roads, water supply, sanitation, telecommunications and suitable trading spaces determine how efficiently businesses can serve customers.
For example, a small food manufacturer requires reliable electricity to operate equipment and preserve products. A retailer needs safe and accessible premises, while a delivery company depends on roads and transport infrastructure to distribute goods.
When these services are unreliable or unavailable, businesses face additional operating costs. Entrepreneurs may have to purchase alternative electricity solutions, spend more on transportation or limit their trading hours.
These challenges can also discourage investment because businesses cannot confidently plan expansion when essential services remain uncertain.
Improving township infrastructure would therefore deliver benefits beyond better public services. It could strengthen productivity, attract private investment and create opportunities for businesses to employ more people.
Local authorities could contribute by identifying commercial areas requiring infrastructure improvements and prioritising projects that directly support economic activity.
Digital technology adoption presents another opportunity
Digital transformation is becoming increasingly important for small businesses. However, many township entrepreneurs are still struggling to integrate digital tools into their daily operations.
Balabala reported that only 24% of entrepreneurs surveyed said they were effectively using digital tools to optimise their businesses.
The figures also highlighted a particularly significant gap in artificial intelligence adoption. Only 5% confirmed that they were using AI tools effectively in their businesses.
These findings suggest that access to technology alone is not enough. Entrepreneurs also require training, affordable services and practical guidance on using digital solutions to improve productivity.
Digital platforms can help businesses manage inventory, communicate with customers, promote products, receive payments and monitor sales performance.
Artificial intelligence can also provide opportunities to automate repetitive administrative tasks, generate marketing content, analyse customer preferences and improve business planning.
For smaller enterprises with limited financial resources, these tools could help reduce operating costs and improve competitiveness.
However, entrepreneurs need to understand how to use technology effectively. Digital training programmes should therefore focus on practical business applications rather than simply introducing participants to new software.
Partnerships involving municipalities, banks, technology companies and business development organisations could help close this digital skills gap.
Limited access to electronic payment systems
Access to modern payment infrastructure is another important issue raised by the Township Entrepreneurs Alliance.
Balabala reported that only 9% of surveyed township entrepreneurs confirmed that they had point-of-sale (POS) devices, despite 95% expressing interest in using them.
This gap demonstrates the difference between entrepreneurs recognising the value of technology and having the resources and infrastructure needed to adopt it.
Electronic payment systems can make transactions more convenient for customers and businesses. They can also reduce the need to handle large amounts of cash and help enterprises maintain more accurate transaction records.
For small businesses, digital payment records may also support financial management and provide useful information when approaching financial institutions for business funding.
Nevertheless, introducing electronic payments requires consideration of affordability, transaction fees, connectivity, device availability and financial literacy.
Banks and payment service providers could help by developing affordable products specifically designed for microenterprises and township businesses.
Training should also explain how entrepreneurs can manage digital transactions, protect customer information and identify fraudulent payment activities.
Improving access to payment technology could strengthen the formalisation and financial visibility of township businesses.
Questions over the effectiveness of business funding programmes
The debate surrounding township entrepreneurship also raises questions about how business development funding is distributed and managed.
Balabala criticised the implementation of the spaza shop fund, arguing that development finance initiatives should consider the actual needs and circumstances of businesses receiving support.
His criticism points towards a wider issue affecting entrepreneurship development: providing funding does not automatically guarantee business success.
Entrepreneurs need more than financial assistance. They may require business planning support, financial management training, mentorship, access to suppliers, customer development and assistance with regulatory compliance.
Funding programmes should therefore consider the maturity of each business and the specific challenges it faces.
For example, an entrepreneur starting a manufacturing business may need equipment and technical training, while an established retailer may require inventory financing and digital payment infrastructure.
A more development-focused approach could involve assessing businesses before providing funding and offering continued support after financial assistance has been distributed.
Monitoring should also focus on measurable outcomes, including business survival, revenue development, employment creation and improvements in productivity.
This would help ensure that public and private development funding contributes to sustainable economic activity.
Township Economy Alliance prepares entrepreneurship summit
As part of efforts to strengthen township entrepreneurship, the Township Entrepreneurs Alliance is preparing a township economy summit scheduled for November 19 and 20 in Tembisa, Gauteng.
The event is expected to bring together township businesses, corporate representatives and government authorities to discuss opportunities and challenges affecting local enterprises.
An important feature will be the Kasi Pitching Challenge, through which approximately R150,000 will be distributed among the six leading participants.
Pitching competitions can help entrepreneurs present their business ideas, demonstrate commercial potential and attract attention from potential investors and development partners.
They also encourage business owners to improve their communication, financial projections and understanding of market opportunities.
The summit will additionally include an exhibition where township enterprises can showcase their products, goods and services.
Such exhibitions can help small businesses connect with corporate buyers, government departments, suppliers and other entrepreneurs.
These relationships are particularly valuable because smaller enterprises often struggle to access established distribution networks and larger commercial markets.
The event therefore offers an opportunity to strengthen business visibility and encourage partnerships that extend beyond individual township communities.
Local government reforms are essential for economic development
The calls for improved township business conditions come at a time when South Africa is also facing broader questions about municipal performance, governance and public-sector accountability.
Business Leadership South Africa (BLSA), in its quarterly reform tracker, reported a decline in its governance reform score from 55.0 to 54.6.
The report also highlighted developments involving public procurement legislation and the need for National Treasury to introduce a replacement bill following the Constitutional Court’s ruling concerning the Public Procurement Act.
These governance developments matter to entrepreneurs because public institutions influence the availability of business opportunities, procurement contracts, infrastructure investment and municipal services.
For township enterprises, transparent procurement systems could create opportunities to supply products and services to municipalities and other public institutions.
However, businesses need accessible tender information, fair competition and administrative processes that do not automatically disadvantage smaller enterprises.
Local government also needs sufficient technical and financial capacity to implement development programmes effectively.
Municipal budgets could influence township business opportunities
Funding allocated to local government will also influence the environment in which township entrepreneurs operate.
According to the report, Finance Minister Enoch Godongwana announced in the medium-term budget policy statement that local government would receive 10% of available non-interest government spending over the medium term.
The announcement included an additional R21.8 billion for the local government equitable share, intended to support the costs of providing essential services such as water, sanitation, electricity and refuse removal.
These allocations are important because reliable municipal services contribute directly to the operating conditions of small businesses.
However, entrepreneurs will ultimately judge government commitments by the improvements they experience in their communities.
Municipalities need to ensure that allocated resources translate into functioning infrastructure, improved service delivery and more supportive commercial environments.
The report also highlighted municipal financial challenges, noting that 37 of the 69 municipalities affected by suspended equitable share transfers had concluded council-approved repayment plans by the end of July and paid R4.2 billion to creditors.
Stronger municipal financial management could improve the reliability of services and create better conditions for private-sector investment.
What political parties need to prioritise
As voters prepare to participate in local government elections, township entrepreneurs are placing greater emphasis on economic policies that address everyday business challenges.
Their expectations extend beyond political promises about job creation. They want practical interventions that make it easier to establish, operate and expand enterprises.
Several priorities emerge from the concerns highlighted by the Township Entrepreneurs Alliance.
First, municipalities should review regulations that unnecessarily complicate business operations while maintaining appropriate health, safety and consumer protections.
Second, infrastructure investment should prioritise commercial areas where improved electricity, roads, water and connectivity can support productive economic activity.
Third, financial institutions and technology providers should develop affordable solutions that help smaller businesses access electronic payments and digital management systems.
Fourth, entrepreneurship support programmes should combine funding with mentorship, market access and practical business training.
Finally, local authorities should create stronger relationships with township business associations so that policies reflect the experiences of entrepreneurs.
These interventions could help transform township economies into stronger contributors to South Africa’s economic growth.
The importance of township entrepreneurship for employment
Small businesses are particularly important in an economy where unemployment and limited economic opportunities remain major concerns.
Entrepreneurship allows individuals to identify market opportunities, establish enterprises and create income-generating activities.
Although not every startup becomes a successful employer, businesses that survive and expand can contribute to employment across their communities.
A growing township food manufacturer, for instance, may eventually employ production workers, drivers, sales representatives and administrative personnel.
Similarly, an expanding retail enterprise can create opportunities for suppliers, distributors and service providers.
This means supporting one enterprise can generate economic benefits across a wider network of businesses.
Furthermore, township entrepreneurs often understand local customer preferences and community needs. This knowledge can help them develop products and services suited to markets that larger companies may overlook.
Strengthening these businesses could therefore support inclusive economic development while increasing participation in commercial activities.
Outlook: A stronger township economy requires practical action
The latest concerns raised by township entrepreneurs highlight the need for a more comprehensive approach to small-business development in South Africa.
The country’s township economies have considerable commercial potential, but entrepreneurs need an environment in which businesses can operate reliably, access customers and grow sustainably.
The findings presented by Bulelani Balabala demonstrate several areas requiring attention, including infrastructure disparities, limited digital adoption, insufficient access to POS technology and concerns about the effectiveness of business funding initiatives.
The upcoming Township Economy Alliance summit in Tembisa offers an opportunity to bring entrepreneurs, government representatives and corporate organisations together to discuss practical solutions.
Its Kasi Pitching Challenge and business exhibition could also help participating enterprises gain exposure and connect with potential partners.
Ultimately, the success of township entrepreneurship will depend on cooperation between municipalities, national government, financial institutions, private companies and business development organisations.
Political parties seeking support from township communities will need to demonstrate how their policies can translate into measurable improvements for entrepreneurs.
For business owners, the central issue is straightforward: they want the freedom and opportunity to trade, grow and create employment without unnecessary obstacles.
If South Africa can address these challenges through effective policies, reliable infrastructure and meaningful business development support, township enterprises could become increasingly important drivers of investment, innovation and inclusive economic growth.
