Research issues concerning tourism and local economic development in small towns of South Africa have attracted much active concern. This research interest is boosted by South African policies for local government and tourism which allocate substantial responsibility to local government for tourism. Arguably, the practice of destination management is one of the most significant underpinnings for successful local tourism development albeit it is one of the least well-researched at the level of local governments in South Africa. The study is framed within an international literature and debates on destination development and represents a novel contribution to the limited body of African knowledge relating to the public sector and the challenges of local governments in destination management. The case study is of the Overstrand Local Municipality in Western Cape Province and based upon a quantitative profile of local tourism performance and the findings from 40 semi-structured interviews conducted in 2025 with tourism business stakeholders. The key findings reinforce the importance of the practice of destination management and in particular around both destination marketing and a cluster of issues surrounding an improved business environment.