Assessment of challenges and risk factors influencing the operation of emerging contractors in the Gauteng Province, South Africa

Abstract

This study investigated whether the risk factors and challenges emerging contractors encounter have an impact on their business operations and sustainability within the construction industry. The study adopted the qualitative research approach to meet the study objectives and aims. Semi-structured questionnaires were used to interview participants from emerging contractors with Construction Industry Development Board (CIDB) Grading one (1) to four (4) in the Gauteng Province, South Africa. Qualitative content analysis for the collected data by grouping the responses into themes and frequency and percentage derived for the various themes. The main findings of the study revealed that the challenges affecting emerging contractors are the lack of financial support from the commencement of projects and during project execution; the extraordinary level of competition among the pool of emerging contractors and delay in payment from government institutions and client which have impacted their business operations. The study was done on emerging construction companies that are in the Gauteng Province of South Africa only, but the results may be applicable in other provinces, even beyond South Africa. The empirical results confirmed that the challenges and risk factors which have been identified as lack of financial support from financial institutions in the initial stage of projects and during project execution; high level of competition among emerging contractors and delay in payment from government institutions and client faced by emerging contractors have an impact on their operations and sustainable growth in the construction industry.

Keywords:

• Cash flow
• challenges
• economic drivers
• emerging contractors
• risk factors

Disclosure statement

No potential conflict of interest was reported by the author(s).