Business model innovation for residential property developers in Gauteng

Abstract

Companies constantly change their business models and invest in innovative techniques to increase their market share. Gauteng, as the economic hub of South Africa, struggles with an increasing housing shortage and an increasing population. Residential property developers deal with a sophisticated and diverse housing market. This study investigates business model innovation for residential property developers in Gauteng, determining how they can increase their competitive advantage. Literature explains that financial institutions play a significant role in the success of residential property developersÕ businesses. The literature on sustainability and innovation covers business models in general. However, it does not cover how residential property developers implement these concepts in their business models. Consideration is also not given to South Africa as a developing country. Therefore, this study aims to understand innovation in the business models of residential property developers and the challenges faced. For this qualitative study, ten semi-structured interviews were conducted with residential property developers in Gauteng. The results of this study indicated that residential property developers prefer closed innovation processes and advances in technology supported these findings. The findings also discovered the value-adding factors applicable for sustainable residential development. A value-adding factor framework was developed to assist residential property developers to manage more profitable and sustainable businesses.