What is an SMME?

We have recently released our report on "The State of Business in the South African Dental Industry". The purpose of the study was to understand how dental practitioners in South Africa are managing the business side of running a dental practice.

To receive a copy of the report, please click here.

Myth: SMMEs are low revenue generating businesses.


Many assume that SMMEs are businesses run from a basement/ garage, with one or two employees and generate a few thousand in revenue every month. This is inaccurate as many “big” businesses are still classified as SMMEs. In fact, many of the products that we use on a daily basis are produced by businesses that are still classified as SMMEs.


Not all businesses will be listed on the stock exchange. SMMEs play a critical role in achieving economic growth and moving a country forward. We decided to explore what defines an SMME.


Categories of SMMEs as per the National Small Business Act


1) Micro enterprise

- Between one to five employees, usually the owner and family

- Annual turnover- less than R0.15 million

- Informal - no license, formal business premises

- Basic business skills and training. Potential to make the transition to a viable formal small business.


2) Small enterprise

- Less than 100 employees

- Annual turnover- less than R10 million

- More established than very small enterprises, formal and registered, fixed business premises.

- Owner managed, but more complex management structure


3) Medium enterprise

- Up to 200 employees

- Annual turnover- less than R20 million

- Still mainly owner managed, but decentralised management structure with division of labour.

- Operates from fixed premises with all formal requirements.


Government has prioritised entrepreneurship and the advancement of Small, Medium and Micro-sized Enterprises (SMMEs) as the catalyst to achieving economic growth and development. With the assistance of other government departments and institutions, the Department of Trade & Industry (DTI) takes the lead in implementing SMME-related policies, to ensure that adequate financial and non-financial assistance is provided to the sector, for its long-term prosperity and that of the country as a whole (Source- www.thedti.gov.za)


One of the big benefits of being an SMME is access to finance, from grants and development programmes. The Department of Trade and Industry offers a range of products and services to small enterprises that facilitate access to finance such as loans and incentive grants.


For access to our free business health check click here.

Boraine Consulting has been set up to assist SMMEs with accounting, tax and consulting on various business challenges. For more information, contact us today.


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