ESC
Clarivate

 
Source: Journal Citation ReportsTM from ClarivateTM 2022

Entrepreneurship and Sustainability Issues Open access
Journal Impact FactorTM (2022) 1.7
Journal Citation IndicatorTM (2022) 0.42
Received: 2019-10-11  |  Accepted: 2020-04-18  |  Published: 2020-06-30

Title

A holistic assessment of the risks encountered by fast moving consumer goods SMEs in South Africa


Abstract

Fast moving consumer goods (FMCG) small and medium-sized enterprises (SMEs) play an indispensable role in the emerging economies by selling products that are often classified as necessities. This paper argues that the traditional classification of risks into mainly operational, strategic, financial, and compliance risk, exposes FMCG SMEs to sustainability issues today. Focusing on sustainability and the associated factors, this paper seeks to offer a broader perspective on the risks that are crucial to the survival of FMCG SMEs in a fast-paced changing environment. The empirical investigation relied on the mixed research methods with the survey questionnaire and personal interviews as tools of interest. Two expert interviews were held to complement the quantitative data that was collected from 289 respondents. The research findings highlight the necessity for FMCG SMEs to look beyond the traditional risk types by incorporating social, economic and environmental risks, which are essential elements of the sustainability framework today. By combining these three components of sustainability into risk assessment, the paper seeks to introduce a more holistic view of risk sources that include evolving risk areas that are of growing importance in a rapidly changing global environment.


Keywords

risks, business survival, sustainability, traditional view, expanded view, Fast moving consumer goods (FMCG), Small and Medium-sized Enterprises (SMEs), South Africa


JEL classifications

M40 , M10 , M14 , M42


URI

http://jssidoi.org/jesi/article/588


DOI


Pages

3321-3338


This is an open access issue and all published articles are licensed under a
Creative Commons Attribution 4.0 International License

Authors

Chakabva, Oscar
Cape Peninsula University of Technology, Cape Town, South Africa http://www.cput.ac.za
Articles by this author in: CrossRef |  Google Scholar

Tengeh, Robertson K.
Cape Peninsula University of Technology, Cape Town, South Africa http://www.cput.ac.za
Articles by this author in: CrossRef |  Google Scholar

Dubihlela, Jobo
Cape Peninsula University of Technology, Cape Town, South Africa http://www.cput.ac.za
Articles by this author in: CrossRef |  Google Scholar

Journal title

Entrepreneurship and Sustainability Issues

Volume

7


Number

4


Issue date

June 2020


Issue DOI


ISSN

ISSN 2345-0282 (online)


Publisher

VšĮ Entrepreneurship and Sustainability Center, Vilnius, Lithuania

Cited

Google Scholar

Article views & downloads

HTML views: 3438  |  PDF downloads: 1282

References


Allan, N. & Beer, L. e2006. Strategic risk: It's all in your head. University of Bath; School of Management Working Paper Series 2006.01.

Search via ReFindit


Association of Chartered Certified Accountants. 2015. Strategic and operational risks. Available from: nal-exams-study-resources/p1/technical-articles/strategic-operationalrisks.html http://www.accaglobal.com/ie/en/student/exam-support-resources/professio

Search via ReFindit


Aureli, S. & Salvatori, F. 2013. The current state of risk management in Italian small and medium-sized enterprises. Proceedings of the 8th International Conference Accounting and Management Information Systems AMIS 2013.

Search via ReFindit


Ayandibu, A.O. & Houghton, J. 2017. The role of small and medium scale enterprise in local economic development (LED). Journal of Business and Retail Management Research, 11(2), 133-139.

Search via ReFindit


Banerjee, S., Dasgupta, S. & Kim, Y. 2008. Buyer-supplier relationships and the stakeholder theory of capital structure. The Journal of Finance, 63, 2507-2552.

Search via ReFindit


Basel Committee on Banking Supervision. 2001. Operational risk. Available from: https://www.bis.org/publ/bcbsca07.pdf

Search via ReFindit


Basel Committee on Banking Supervision. 2011. Principles for the sound management of operational risk. Available from: http://www.bis.org/publ/bcbs195.pdf

Search via ReFindit


Brockett, A.M. & Rezaee, Z. 2012. Corporate sustainability: integrating performance and reporting. Hoboken, NJ: John Wiley.

Search via ReFindit


Bure, M. & Tengeh, R.K. 2019. Implementation of internal controls and the sustainability of SMEs in Harare in Zimbabwe. Entrepreneurship and Sustainability Issues, 7(1), 201-218. http://doi.org/10.9770/jesi.2019.7.1(16)

Search via ReFindit


Calton, J. 2001. Dialogue and the art of thinking together. A pioneering approach to communicating in business and in life by William Isaacs, Business and Society, 40(3), 343-348.

Search via ReFindit


Center for Audit Quality. 2012. Guide to internal control over financial reporting. Washington, DC: CAQ.

Search via ReFindit


CGAP. 2009. Operational risk management for microfinance entities. Available from: http://www.microfinancegateway.org/gm/document1.9.34371/CGAP%20Operational%20Risk%20Management%20Course.pdf

Search via ReFindit


Chehabeddine, M., Tvaronavičienė, M. 2020. Securing regional development. Insights into Regional Development, 2(1), 430-442. http://doi.org/10.9770/IRD.2020.2.1(3)

Search via ReFindit


Coles, R. & Kirwan, M. 2011. Food and Beverage packaging technology. Chichester: Wiley-Blackwell.

Search via ReFindit


COSO. 2004. Enterprise Risk Management - Integrated Framework. Executive Summary. Available from: http://www.coso.org/documents/coso_erm_executivesummary.pdf

Search via ReFindit


Coyle, B. 2004. Risk Awareness and Corporate Governance. Canterbury: Global Professional Publishing Kent.

Search via ReFindit


Daniel, L. 2019. Eskom to increase electricity tariffs by 80% to recoup financial losses. Available from: https://www.thesouthafrican.com/news/eskom-to-increase-electricity-prices-in-2020/

Search via ReFindit


Deloitte. 2013. Exploring strategic risk. Available from: https://www2.deloitte.com/content/dam/Deloitte/global/Documents/Governance-Risk-Compliance/dttl-grc-exploring-strategic-risk.pdf

Search via ReFindit


Dietsche, C. 2009. Networking against stakeholder risks: A case study on SMEs in International Shrimp Trade, Belgeo, 10(1), 27-42.

Search via ReFindit


EMF. 2012. Towards the circular economy Vol. 1. In Economic and business rationale for an accelerated transition. Ellen MacArthur Foundation. Available from: https://www.ellenmacarthurfoundation.org/assets/downloads/publications/Ellen‐MacArthur‐Foundation‐Towards‐the‐Circular‐Economy‐vol.1.pdf

Search via ReFindit


Enow, S.T., Kamala, P. 2016. The accounts payable management practices of small, medium and micro-enterprises in the Cape Metropolis, South Africa. Innovations, 13, 77-83.

Search via ReFindit


EPA. 2013. Municipal Solid Waste Generation, Recycling, and Disposal in the United States: Facts and Figures for 2013. Available from: /web/pdf/msw2013rpt.pdf https://archive.epa.gov/epawaste/nonhaz/municipal

Search via ReFindit


Forum for the Future. 2014. Scaling disruptive innovation in sustainable packaging. Available from: http://www.forumforthefuture.org/sites/default/files/Sustainable%20packaging.pdf

Search via ReFindit


Godbole, P. 2012. Effective risk management is crucial for small businesses: Mritunjay Kapur. Business Standard, January 17. Available from: https://www.business-standard.com/article/sme/effective-risk-management-is-crucial-for-small-businesses-mritunjay-kapur-112011700102_1.html

Search via ReFindit


Goldberg, M. & Palladini, E. 2010. Managing risk and creating value with microfinance. Washington D.C: World Bank Publications.

Search via ReFindit


Green Restaurant Association. 2005. Energy and Water. Available from: http://dinegreen.weebly.com/energywater.html

Search via ReFindit


Horcher, K.A. 2011. Essentials of Financial Risk Management. Hoboken: John Wiley & Sons.

Search via ReFindit


Hubner, A., Kuhn, H. & Sternbeck, M. 2013. Demand and supply chain planning in grocery retail: An operations planning framework. International Journal of Retail & Distribution Management, 41(7), 512–553.

Search via ReFindit


Hussain, I., Farooq Z. & Akhtar W. 2012. SMEs development and failure avoidance in developing countries through public-private partnership. African Journal of Business Management, 6(4), 1581-1589.

Search via ReFindit


Ikediashi, D., O. Ogunlana, S. & O. Ujene, A. 2014. An investigation on policy direction and drivers for sustainable facilities management practice in Nigeria. Journal of Facilities Management, 12(3), 303-322.

Search via ReFindit


Irwin, R & Kennedy, A. 2017. Sustainability and enterprise risk management: The first step towards integration. Geneva: World Business Council for Sustainable Development.

Search via ReFindit


Ismail, N., Othman, A.A., Yousop, N.M. & Ahmad, Z. 2016. Empirical Evidence on the SMEs Risks Framework in Malaysia. Journal of Advanced Research in Social and Behavioural Sciences, 3(1), 52-62.

Search via ReFindit


Johnson & Johnson. 2013. Framework for enterprise risk management. Available from: https://www.jnj.com/sites/default/files/pdf/JnJ_RiskMgmt_ERMFramework_guide_v16a.pdf

Search via ReFindit


Kaplan, R.S. & Mikes, A. 2012. Managing risks: A new framework. Harvard Business Review, 90(6).

Search via ReFindit


Koor, F. 2018. Sustainability trends shaping retail in 2018. Available from: https://www.bizcommunity.com/PDF/PDF.aspx?l=196&c=457&ct=1&ci=176254

Search via ReFindit


KPMG. 2014. Fast moving consumer goods in Africa. Available from: http://kpmg.com/Africa

Search via ReFindit


Kumar, D. 2002. CPG Industry: Supply chain drivers using SCOR. Vision: The Journal of Business Perspective; Special Issue on Supply Chain Management, 7(1), 99-107.

Search via ReFindit


Kumar, D. 2004. Beyond the low-hanging fruit: using lean concepts to peel away the supply chain inefficiencies. Industrial Engineer, 36(5):44-48.

Search via ReFindit


Mohammed, A. & Sykes, R. 2012. Sharpening strategic risk management. Available from: [Accessed 15/10/2018]. http://www.pwc.com/gx/en/services/advisory/consulting/risk/resilience/publications/sharpening-strategic-risk-management.html

Search via ReFindit


Nyakang’o, E.O. & Kalio, A.M., 2013. Effect of financial risks on performance of small and medium enterprises in the hotel industry in Nakuru Municipality, Kenya. International Journal of Innovative Research and Development, 2(11), 257-263.

Search via ReFindit


Ogbor, J.O. 2009. Entrepreneurship in Sub-Saharan Africa: A strategic management perspective. Bloomington: Author House.

Search via ReFindit


Pradana, M. & Bandula, J. 2012. Risk management practices in small and medium enterprises: evidence from Sri Lanka, International Journal of Multidisciplinary Research, (2)7, 226-234.

Search via ReFindit


Risk Management Association. 2017. Operational risk management. Available from: http://www.rmahq.org/operational-risk/

Search via ReFindit


SABCOHA. 2014. Western Cape Business Sector Provincial Strategic Plan 2011–2015. Available from: http://www.sabcoha.org/reports/

Search via ReFindit


Sales, F. 2014. Compliance risk. Available from: definition/compliance-risk http://searchcompliance.techtarget.com/

Search via ReFindit


SBP Alert, 2013. Developing a new path for SMEs in South Africa; Reassessing for Growth. SPB Occasional Paper, 1.

Search via ReFindit


Schlierer, H.J., Werner, A., Signori, S., Garriga, E., Von Weltzien Hoivik, H., Van Rossem, A. & Fassin, Y. 2012. How do European SME owner–managers make sense of stakeholder management: Insights from a cross-national study. Journal of Business Ethics, 109(1), 39-51.

Search via ReFindit


Sheehan, M.J. 2013. Sustainability and the small and medium enterprise (SME): Becoming more professional. Australia: Xlibris Corporation.

Search via ReFindit


Singh, J. 2014. FMCG (Fast Moving Consumer Goods) An Overview. International Journal of Enhanced Research in Management & Computer Applications, 3(6), 14-16.

Search via ReFindit


Singh, M.P., Chakraborty, A., Roy, M. & Tripathi, A. 2020. Developing SME sustainability disclosure index for Bombay Stock Exchange (BSE) listed manufacturing SMEs in India. Environment, Development and Sustainability. https://doi.org/10.1007/s10668-019-00586-z

Search via ReFindit


Stahel, W.R. & Clift, R. 2015. Stocks and flows in the performance economy. In R. Clift & A. Druckman (Eds.), Taking Stock of Industrial Ecology (pp. 137-158). Cham: Springer International Publishing.

Search via ReFindit


Statistics South Africa. 2019. Consumer Price Index. Available from: http://www.statssa.gov.za/publications/P0141/P0141August2019.pdf

Search via ReFindit


Surridge, M & Gillespie, A. 2017. AQA GCSE (9-1) Business. London: Hodder Eduaction.

Search via ReFindit


Tampa Water Department. 2010. Restaurant water efficiency checklist. Available from: http://www.tampagov.net/dept_Water/information_resources/Efficiency_checklists/restaurant_water_efficiency_checklist.asp

Search via ReFindit


Taylor, J.C. 2012. Concepts of strategic risks and managing strategic risks. Available from: http://vsu.edu/files/docs/internal-audit/risk-concepts.pdf

Search via ReFindit


Tonello, M. 2012. Strategic risk management: a primer for directors. Available from: https://corpgov.law.harvard.edu/2012/08/23/strategic-risk-management-a-primer-for-directors/

Search via ReFindit


UNESCO. 2010. Risk Management Handbook. Available from: http://unesdoc.unesco.org/images/0019/001906/190604e.pdf

Search via ReFindit


Vaishnani, H.B. 2011. Effects of sales promotions on consumer preferences and brand equity perception, thesis submitted in partial fulfillment of the requirements for the Degree of Doctor of Philosophy to Saurashtra University.

Search via ReFindit


Van Eeden, S., Viviers, S. & Venter, D. 2004. An exploratory study of selected problems encountered by small businesses in a South African context. Journal of African business, 5(1):45-72.

Search via ReFindit


Viviers, W. 2004. Competitive advantage: intelligence – what intelligence? Finance Week, 1.

Search via ReFindit


Von Rossing, R. 2007. IT control objectives for Basel II: the importance of governance and risk management for compliance. Rolling Meadows, IL: IT Governance Institute.

Search via ReFindit


Watt, J. 2007. Strategic risk management for small businesses, in Reuvid, J. (Ed.): Managing business risk – A practical guide to protecting your business, London: Kogan Page.

Search via ReFindit


WEF Global Risks Report. 2016. The Global Risks Report 2016, 11th Edition. Geneva: World Economic Forum.

Search via ReFindit


WEF Global Risks Report. 2019. The Global Risks Report 2019, 14th Edition. Geneva: World Economic Forum.

Search via ReFindit


Wurzler, J. 2013. Information risks & risk management. Available from: http://www.sans.org/reading-room/whitepapers/policyissues/information-risks-riskmanagement34210

Search via ReFindit


Yusuf, T. O. & Dansu, F. S. 2013. SMEs, Business Risks and Sustainability in Nigeria. European Journal of Business and Social Sciences, 2(9):76-94.

Search via ReFindit


Zhao, S. & Zeng, M. 2014. Theory of SMEs financial risk prevention and control. In 2014 International Conference on Education, Management and Computing Technology (ICEMCT-14). Atlantis Press.

Search via ReFindit