When businesses transition from the informal to the formal sector, they could experience several challenges. In research conducted in Bloemfontein, South Africa (Tassin 2014), the following challenges were evident in transitioning from an informal to a formal business: lack of information and limited skills, regulatory barriers, administrative barriers, financial requirements and business fees, corruption, fear of the unknown and smallness of the business. Tassin (2014:43) emphasised that the ‘lack of proper information on government support agencies put in place to assist small enterprises in the informal sector to become formal is a great impediment to formalisation’. Without access to proper information, the informal craft traders in Tembisa would not be able to transition to formal businesses. Regulatory barriers refer to regulations that are restricting new entrants or those transitioning from the informal to the formal sector (Banda, Robb & Roberts 2015). Administrative barriers include long queues to obtain forms and excessive paperwork to formalise their business (Tassin 2014:44). The size of the business can have an impact on the success of the transition. Stakeholders can play a supporting role in assisting these informal and small businesses in making their transition. These stakeholders include the government, government entities, the private sector and non-governmental organisations. According to the findings by Tassin (2014:62), some of the factors that have contributed to the transition are ‘growth and expansion, access to proper banking services, government contracts and tenders, access to bank loans and trust from customers/ suppliers’.

Research conducted by Banda et al. (2015b) through the Centre for Competition, Regulation and Economic Development showed that securing financial support for the business is the main challenge to transition to the formal sector. Once funding has been obtained, the authors found that it is incorrectly used. To avoid the misuse of funding, they suggest that training in communication, negotiation and other entrepreneurial skills, together with development finances, be offered to these entrepreneurs.

The access to market is critical to reach adequate numbers of potential consumers (Banda et al. 2015a). To overcome this barrier, support in identifying potential consumers and marketing to these consumers should be provided (Banda et al. 2015a). This is of particular relevance to the informal craft traders in Tembisa. The representative of Ekurhuleni Department of Economic Development (DED) indicated that they facilitate such processes but they have not facilitated one specifically for craft traders.

The municipality will grant free use of facilities for art-related events (Ekurhuleni Metropolitan Municipality 2006 s 2A(11)). This means that events such as art seminars, exhibitions and training can take place at these facilities within the municipality for free. In addition (Ekurhuleni Metropolitan Municipality 2006):

The extent to which informal craft traders such as those selling woven baskets and beaded accessories can benefit from these by-laws has not been investigated.

In summary, little is known about the women who sell crafts in Tembisa, trading in the informal sector. Literature has revealed that the majority of informal traders in South Africa are women from poor communities.

The primary objective of this study was to investigate the business model used, skills needed by and opportunities and support measures available to the women informally trading craft ware in Tembisa to empower them to move from the informal to the formal sector.

This section focuses on presenting and interpreting the demographic information of respondents participated in this study, who are informal traders from Tembisa township.

From the quantitative survey, the majority (84%) of the 32 respondents were non-South Africans, with only 16% South African. The foreigners are nationals from the following countries: Zimbabwe, Lesotho, Swaziland and Mozambique, all bordering on South Africa. More than half (59%) of the respondents can be classified as youth, between the ages of 18 and 35 years, whilst 41% were between 36 and 65 years. It follows that some foreign youths use weaving as a form of employment. Foreigners entering into the informal sector can be attributed to the ‘costs and regulatory barriers of entry into the formal economy; limited education and training opportunities; [and] increasing demand for and migration motivated by economic hardships and poverty’ (Ndabeni & Maharaj 2013:17).

All the respondents had dependents, with 47% of the respondents responsible for one or two dependents, whilst a further 47% support between three and five dependents and 6% support as many as six or seven dependents. Of the five South African respondents, four had secondary and one had a tertiary level of education. The majority (16) of the non-South Africans have secondary education, whilst five have primary level education and six have no education. Thus, 63% of all the respondents have secondary education.

The respondents indicated that the weaving business is seasonal. In the case of baskets, the straw used for weaving is not available throughout the year but only sufficient after the rainy season. At the time of collecting data (September and August), there was a shortage in the supply of straw, resulting in only seven of the respondents having baskets for sale. Most respondents sell baskets as well as African accessories. Of the 32 respondents, 25 sell only accessories, whilst only 7 respondents sell baskets; and of these 7, only 5 sell both baskets and accessories, which means that 30 respondents sell accessories.

The respondents sell a variety of woven art products. The straw Basotho mat and small broom are used when selecting beans (Figure 1a). The mantji [baskets] are made by the Swati people and used to carry fruits and vegetables (Figure 1b). A similar basket is popularly used in the home for fruit storage (Figure 1c).

The laundry baskets are available all year round and are typically woven by men and sold by women (Figure 2). These baskets are made from old drainage pipes heated over fire. The softened plastic is stretched into long strings for weaving.

A few African accessories, such as the Basotho hats, are woven from straw (Figure 3). The one on the left is for an adult and the unfinished one on the right is for a child.

The respondents sell a range of traditional accessories made primarily from beads (Figure 4).

The majority of the customers of the respondents are community members. Of the 32 respondents, 10 respondents sell their products door to door, whilst 17 respondents sell at street corners or taxi ranks. The five South African respondents (16% of the sample) sell their crafts to the local art centre.

According to the respondents, the sales of these art-and-crafts products are irregular and tend to be seasonal. All the respondents highlighted that sales of accessories are higher between September and December and again in March and April. They ascribe it to September being Heritage Month in South Africa and the increase in weddings during the warmer months of December, March and April. Respondents noted that the data-collection period (August and September) was the ‘good season’, as they had started receiving orders from clients for the week of Heritage Day.

The respondents spend between 5 and 7 days a week selling their products. There seems to be a direct and positive relationship between the number of days respondents operate and the income they receive per week (Table 1).

The 15 respondents who earn between R501 and R1000 per week sell for only 5 days per week, whilst 8 of the 13 respondents who earn between R1501 and R2000 per week operate for 6 days. Seven operate for 7 days per week (Table 1). A further four respondents who operate 7 days per week earn more than R2000 per week. Respondents who sell their products on weekends explained that most of their clients work during the week and can only purchase over weekends.

This section focuses on the different skills that the respondents possess and their skills training requirements. The skill of weaving can be acquired from formal and informal educational settings. Of the 32 respondents, 17 weave their own crafts. They learnt the skill of weaving from friends, family (mothers and grandmothers were mentioned by most respondents) and at school. Only two of the five South Africans weave the products they sell and learnt the skill of weaving at school. The other three South Africans buy the woven products to sell. This supports findings by Hunter and Skinner (2001) that some foreigners have been trained in their home country, and the possibility therefore exists for skills to be transferred from these foreign traders to the local people. One of the respondents of the study indicated that they would like to teach young people in South Africa how to do craft work. Most of these respondents say they require training in entrepreneurial skills (94%), communication skills (97%) and negotiation and networking skills (97%) (Table 2). Only the two South Africans had received training. DSBD (2017) highlighted that such training will uplift respondents and can result in informal businesses realising the benefits of transitioning, where they will be able to benefit from the incentives and small and medium enterprise programmes.

Of the 32 respondents, 66% would like to grow their businesses. However, they identified several challenges preventing them from doing so (Table 3). For the 21 respondents who want to grow their businesses, the two main challenges are limited skills (62%) and lack of information (48%). This is in line with the finding of Tassin (2014) that lack of information on the type of support that is available for informal traders weakens or discourages the informal traders’ interest in transitioning into the formal sector.

Even though most of the respondents are foreigners, only 24% found language to be a barrier to growth. Only 24% of these respondents identified finances as a challenge. It appears that the language used to communicate information about transitioning is not a problem for most of these respondents. Perhaps the challenge lies in the information itself. Ndabeni and Maharaj (2013) found that limited education and training opportunities are some of the barriers to business growth. This highlights the importance of education to ensure that participants fully understand what is presented to them.

Although respondents did not identify finances as a challenge, all 21 respondents identified financial support as the most crucial type of support they need to grow their business, whilst 41% want support in the form of skills development, in particular entrepreneurial education and training.

Eleven (34%) of the respondents indicated that they would not like to grow their businesses. Of the 11 respondents, eight indicated that they were satisfied with the size of their business, whilst three explained that they do not want to pay business fees, and two stated that they are seeking employment. The latter is supported by Anele Horn (2011) who stated that because of the high rate of unemployment in the country, many have resorted to seeking employment in the informal sector.

This study investigated respondents’ opinions towards formalisation, collaboration and establishing partnerships. Of the 32 respondents, none are part of a cooperative, nor would like to be part of one. Of the non-South Africans, eight have formed a group to support each other and to enable all group members to send money to families regardless of sales. Respondents who are not part of a group indicated that they do not want to be part of one. Only two respondents indicated that they are interested in establishing a partnership with an agent, whereas two other respondents said they are interested in collaborating with a distributor who would ensure that their crafts reach more customers.

The majority (78%) of the respondents do not want their business to be formal, stating that the formalisation of their business will restrict the flexibility of their business. They indicated that there is excessive paperwork involved in the process and the transition will mean they have to pay registration fees. The 22% of respondents who would like to transition from the informal to the formal sector foresee benefitting from the opportunities available to formal businesses.

At the Ekurhuleni DED, the business compliance and regulations manager was interviewed to determine whether the DED is implementing programmes for women in business. He has been with the DED since 01 October 2013, and he explained that the Ekurhuleni DED has the following programmes that include women: mentorship, incubators, innovation hubs and the informal trade programme. The latter includes both men and women, with 60% representation by women. The informal trade programme focuses on hawkers, spaza shops and any form of business operating in the informal sector. The Ekurhuleni DED informal trade programme offers respondents transitioning support by ensuring their applications meet all compliance requirements, and that they have the required business permits and permission to use their chosen location, and by assisting them with business registration. In Ekurhuleni, the DED holds road shows to inform the community of these programmes, and these are open to all nationalities, not only South Africans. Respondents can benefit from these programmes.

The manager stated that the Ekurhuleni DED only assists those who approach it and seek assistance. The interviewee added that when implementing these programmes, the Ekurhuleni DED promotes entrepreneurship through introducing the business owners to cooperatives and assisting them to formalise their business so that they are able to seek and apply for opportunities.

The manager added that the Ekurhuleni DED is establishing a directorate focussing on supporting women in business by assisting them to legitimise and formalise their businesses, and promoting access to the markets through enterprise development support.

According to the centre manager, the Moses Molelekwa Centre offers the Tembisa residents a facility where they can showcase their talents. He added that the centre provides a venue for art-related festivals and hosted the Ekurhuleni Public Art Exhibition in 2016. According to the centre manager, who has been with the centre since 2006, the centre is one of the five art centres in Ekurhuleni. It promotes entrepreneurship through events. Whenever there is an event at the centre, artists are offered the opportunity to sell their art and crafts. The Kuwamba Women’s Arts Festival was launched in 2015 and had more than 300 participants at the time of writing.

The art centre manager argues that economic empowerment uplifts people by offering skills development and offering them support to make a living or an income. The skills development and support offered should ensure that the recipients are able to sustain the initiative they have started to earn an income. The centre’s programmes achieve and promote economic empowerment by allowing participants to earn an income and encourage them to further their studies.

The majority of programme participants use the money to further their studies. The programme has produced professional art crafters. In addition, the centre has started a 2-weekly flea market in the Tembisa suburb of Sethokga, where crafters are allowed to exhibit and sell their wares.

The respondents are mostly street vendors, with a few selling door to door. Those who are street vendors do not move around but locate themselves at a specific spot, so that potential customers would know where to find them. There is a correlation between the number of days spent selling and income. Those who sell 7 days per week earn a higher income than those who only sell for 5 or 6 days. Respondents who are open for business on weekends accommodate customers who work during the week and can only shop on weekends. Respondents did not indicate how the prices of the crafts are determined; however, the prices they charge are similar. Three-quarters of the respondents are not willing to transition from an informal to a formal business. Their reasons are that their revenue is irregular and they need flexibility in the business. The reluctance to formalise may be linked to the fact that they are mostly non-South Africans.

The respondents tended to have limited education. Only 1 respondent has a tertiary education, 20 have secondary level of education, 5 attended primary schools and 6 respondents do not have any formal education. This low level of education may be another reason contributing to the reluctance to formalise the business.

Respondents have indicated that they would like to receive financial support, skills development and entrepreneurial education and training. Despite the reluctance to transition to the formal sector, the respondents would like to grow their business, so that their revenue can increase. They noted that they believe that the aforementioned skills will contribute to the growth of their business.

The Ekurhuleni Metropolitan Municipality has well-developed programmes that focus on informal traders. However, these programmes do not specifically cater for or focus on informal craft producers and traders. Support measures and sources of funding are available in the local community to assist informal craft sellers. The Ekurhuleni DED has programmes that are inclusive of women and non-South African nationals, and these address the needs of those who would like to transition to the formal sector. The Ekurhuleni DED does not approach or identify individuals or groups that need assistance, rather requiring those who do to approach it. The Ekurhuleni DED does, however, host road shows to inform the communities about these programmes and plans to establish a directorate that will focus on ensuring that more women operate their business in the formal sector.

The programmes at the Moses Molelekwa Centre are inclusive of women but only for South Africans. The centre does not have programmes that focus on the business process of transition into the formal sector. The centre’s programmes are dependent on the support of sponsors.

The Ekurhuleni DED and the Moses Molelekwa Centre should collaborate and develop empowerment programmes that will include informal women craft traders. The Ekurhuleni DED should create programmes that not only promote the transition process to the formal sector, but also focus on assisting the informal traders to grow their business without enforcing the transitioning process. Once the businesses are established and are making sufficient turnover, the process of transitioning could be introduced.

The Moses Molelekwa Centre could form a partnership with the traders, allowing them to do business at its premises. This will ensure that potential customers know where to go when they want to purchase crafts.

Future research should focus on a much larger sample with mostly South African informal women craft traders to determine their awareness of skills development programmes and challenges in participating in such programmes.