SMEs in South Africa remain resilient despite instability

The recent looting in South Africa left shelves empty and had a devastating impact on small and medium sized enterprises in the country. Image credit: Wikimedia Commons

31 August 2021 – Small and medium enterprises (SMEs) in South Africa has remained resilient despite the recent instability. This is according to research based on the latest data by Skynamo Industry Thermometer.    

Small and medium enterprises (SMEs) are essential to South Africa’s economic health and should play a critical role in the economic recovery post-Covid-19.

However, many of these businesses are fighting to keep their doors open since the onset of the pandemic, with 89% impacted by the recent rioting and looting in KwaZulu-Natal and Gauteng, according to research by BeyondCovid.

Positively, the latest data by Skynamo’s Industry Thermometer for July 2021 reveals that the political turmoil did not have as big of an impact on sales as expected.

Zane van Rooyen, Product Marketing Manager at Skynamo, a South Africa’s field sales app, says that data from the Industry Thermometer, which benchmarks industry sales activity and sector health, showed decreased sales in previous months, but not as much as had been anticipated.  “It does indicate though that there might be a bigger longer-term impact on the recovery that SMEs are working so hard to achieve post the pandemic.”

“When comparing July with June orders, we see technology, accessories, sporting goods and pharmaceuticals taking the biggest knocks, with these sectors showing lower combined ordering values,” adds van Rooyen. “However, the ordering demands of our services customers increased by more than 500%.” He believes this could be linked to the urgent need to restock after supply disruptions in July.

“Encouragingly, our usual steady growth frontrunners like food and beverages, electronics, building materials and hardware, waste management, health and safety and others have maintained the steady month-on-month growth we’ve seen throughout the year so far,” he says.

However, in light of the country’s delayed vaccination rollout and reports of possible renewed volatility, there is much to be done to ensure SMEs do not face long-term difficulties in the months ahead.

Although government assistance in terms of funding and support is essential, van Rooyen believes it is vital for all South Africans to support local SMEs to ensure they are able to weather the storm.

“In addition, small businesses should form a community and assist each other whenever possible,” he asserts. “For those that can, it’s time to reach out by mentoring other entrepreneurs, sponsoring local non-profits with your time and skills, and supporting small businesses and startups. Consider running free training workshops and be generous with your network.”

This is exactly what Skynamo’s community of SMEs did to assist each other during July.  “We reached out to businesses affected by the unrest and proposed that if any of our customers’ products could somehow help other Skynamo customers to repair their damages, we would connect them – and offer a once-off 10% discount on a one-month subscription,” says van Rooyen.

The company has had a great response so far, with customers offering special discounts on paint and related goods, personal protective equipment (PPE), cleaning materials, paper products, industrial supplies, hand sanitizer, disposable masks, IR thermometers, flooring, brooms and office-related products.

“It’s been heartening to see businesses rallying to help each other,” concludes van Rooyen. “It has brought home to us that if we work together, we can not only survive the tough times, but thrive in the midst of them.”

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