Tourism as a Catalyst for Supporting Sustainable SMME Development

Abstract

Globally, entrepreneurship is evident in the tourism industry, primarily receiving policy support and donor-assisted funding in developing countries. The South African Minister of Tourism reported that foreign direct spend on tourism for the first quarter of 2023 was R 25.3 billion increasing by 143.9% from the same period the previous year. This highlights the amount of tourist footfall that happens in South Africa. This can be seen as a huge boost to entrepreneurs and support rising unemployment. While research in entrepreneurship education has been extensively explored, entrepreneurship within the fashion domain has been largely overlooked, with significantly less existing literature in South Africa. Nonetheless, understanding the role of entrepreneurship in tourism development remains limited in academic discussions. Tourism serves as a crucial source of revenue for any economy, contributing not only from tourism itself but also through various associated industries. This includes locally-made products that attract tourists seeking souvenirs as gifts after their travels. To remain competitive, overcome challenges, and avoid unattractive product offerings, the tourism sector must embrace innovation. This research, conducted using a qualitative approach with university students, engaged with small and medium-sized enterprises (SMMEs) producing souvenirs for tourists, encouraging them to employ innovative and cost-effective methods in their product creation. The study's findings revealed five distinct categories of innovation, namely: product innovation, process innovation, managerial innovation, management innovation, and institutional innovation. Among these, process innovation and product innovation were the most frequently implemented innovations to promote locally-made products in the market.