This study analyses survey data gathered from small and large poultry producers in the rural areas of KwaZulu-Natal, and highlights factors constraining the impact of commercial poultry production on the local economy. It was found that small-scale poultry production has the ability to initiate economic growth through the "export" of its products and to draw under-utilised resources such as labour into production. The impact of the subsequent multiplier effect is most likely strongest in the non-tradable, non-agricultural sector. Alleviating constraints for a large number of small enterprises is expected to impact more positively on the rural economy than if a few larger enterprises were encouraged to grow bigger. The descriptive results suggest that small producers face much higher transaction costs than larger producers. Government policies should focus on absorbing some of these transaction costs to nurture economic growth in the rural areas of KwaZulu-Natal, i.e. by improving education, physical infrastructure and technology transfer through extension. Other important interventions include the provision of mentoring and training services for new managers including institution, legal and financial management instruction.