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17 July 2012 at 17:24 - Posted by Anonymous

‘Poor services cripple SA business’


Poor service delivery, particularly in the electricity sector, is a real impediment to business growth, a new survey has revealed.

About 59 percent of business owners questioned said their businesses had been negatively affected by poor service delivery.

Billing problems and utilities such as electricity were particular problems for 12 and 18 percent respectively of respondents.

The study by Grant Thornton was released on Tuesday.

Companies in the Eastern Cape were most affected, with 65 percent of executives complaining of poor services.

The Grant Thornton International Business Report (IBR) provides quarterly insight into business perceptions, both in South Africa and abroad.

Electricity tariff increases and an intermittent power supply presented problems, particularly for small businesses, said Deepak Nagar, national chairman of Grant Thornton.

“There are two power stations being built, but from the perspective of the general public, they're not being built fast enough,” he said.

Crime was another concern, with 46 percent of businesses negatively affected by crime over the past 12 months.

This represented a dramatic reduction since 2007, when 86 percent of businesses were affected by crime, but was still high.

“Nearly one in two respondents are affected by crime,” said Nagar.

No international comparisons were available for crime and services.

Firms were still concerned about the skills shortage, with 38 percent of respondents citing this as a constraint.

The lack of skills constrained 36 percent of companies in Brazil, Russia, India, and China, and 27 percent of global firms.

Red tape, including the cost of compliance with empowerment legislation and tax, was a business constraint for 37 percent of local respondents to the survey.

Only 27 percent of global respondents and 36 percent of respondents in Brazil, China, Russia, and India said this was also a constraint for their firms. - Sapa

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