The government’s commitment to place Small, Medium and Micro Enterprises (SMME) and Co-operatives at the center of economic growth and job creation has been given a long awaiting boost by key amendments to the National Small Enterprise Act 2004 (Act no 29 of 2004).
The definition of a “Small Enterprise” has been amended now by the deletion of the words, “very small” from the previous definition. The schedule to the Act and definition has also been amended the exclusion of the “very small” category. The thresholds relating to the “Total gross asset value”, has also been removed as a metric. The threshold metrics relating to “Total full-time equivalent of paid employees” and “Total annual turnover” has been drastically increased.
In the agriculture sector for instance, the metric, “Total full-time equivalent of paid employees” was 100, has now been increased to 250. The metric, “Total annual turnover has been drastically increased from R5M to R35M.
These amendments were necessitated to account for inflation, and some former metrics were often inappropriate and difficult to measure. The amendment will now open the doors for many more small businesses who, because of the narrowed definition of the past, were excluded from the benefits provided for in the National Development Plan and the objectives of the Department of Small Business Development in terms of Black Business Supplier Development Co-operative Incentive Schemes, Shared Economic Infrastructure Facilities and the National Informal Business Upliftment Strategies.
The new schedule:
Schedule: Definition For Small Business
| Sectors or sub-sectors in accordance with the Standard Classification | Size or class of enterprise | Total full-time equivalent of paid employees | Total annual turnover |
| Agriculture | Medium | 250 | 35,0 Million |
| Small | 50 | 17,0 Million | |
| Micro | 10 | 7,0 Million | |
| Mining and Quarrying | Medium | 250 | 210,0 Million |
| Small | 50 | 50,0 Million | |
| Micro | 10 | 15,0 Million | |
| Manufacturing | Medium | 250 | 170,0 Million |
| Small | 50 | 50,0 Million | |
| Micro | 10 | 10,0 Million | |
| Electricity, Gas and Water | Medium | 250 | 180,0 Million |
| Small | 50 | 60,0 Million | |
| Micro | 10 | 10,0 Million | |
| Construction | Medium | 250 | 170,0 Million |
| Small | 50 | 75,0 Million | |
| Micro | 10 | 10,0 Million | |
| Retail, motor trade and repair services | Medium | 250 | 80,0 Million |
| Small | 50 | 25,0 Million | |
| Micro | 10 | 7,5 Million | |
| Wholesale | Medium | 250 | 220,0 Million |
| Small | 50 | 80,0 Million | |
| Micro | 10 | 20,0 Million | |
| Catering, Accommodation and other trade | Medium | 250 | 40,0 Million |
| Small | 50 | 150,0 Million | |
| Micro | 10 | 5,0 Million | |
| Transport, Storage and Communications | Medium | 250 | 140,0 Million |
| Small | 50 | 45,0 Million | |
| Micro | 10 | 7,5 Million | |
| Finance and Business Services | Medium | 250 | 85,0 Million |
| Small | 50 | 35,0 Million | |
| Micro | 10 | 7,5 Million | |
| Community, Social and Personal Services | Medium | 250 | 70,0 Million |
| Small | 50 | 22,0 Million | |
| Micro | 10 | 5,0 Million |
Owners of small businesses should take note of these amendments and make use of the opportunities created by the amendments.