The Relevance of the Liability of Newness in a Post-COVID-19 South African Small, Medium, and Micro Enterprise Dispensation

Small, Medium and Micro Enterprises (SMMEs) are major socioeconomic contributors globally. In South Africa, these business entities supply roughly 50% towards the national Gross Domestic Product, and employment opportunities for at least 60% of the national workforce. Unfortunately, research shows that South African SMMEs have among the highest failure rates in the world, with approximately 75% failing after operating for only three years. In 1965, Arthur Stinchcombe considered the high risk of SMME failure and developed a theory called the liability of newness, where all possible reasons for it can fit into four distinct categories. Even though this theory is older than a half-century, within the ambit of this study, the primary objective was to ascertain the relevance of the liability of newness in a post-COVID-19 South African SMME dispensation. Non-empirical, qualitative, exploratory research was conducted through an online desktop review to achieve the latter. From the research conducted, it became apparent that although the liability of newness is still relevant in a post-COVID-19 South African dispensation, two categories appear to be more relevant, at least theoretically speaking.