South Africa’s economy was hit from the onset of the Covid-19 outbreak, affecting import and export trade between South Africa and China, plummeting the rand by the time the lockdown was imposed in the last week of March.
The banking sector joined the government and the South African Reserve Bank in offering cushions for the financial blows anticipated for businesses and employees who would be affected by the imposed restrictions to movement and trade.
According to Alan Shannon, a Nedbank executive for professional and small-business banking client engagement, many South African small-business owners were rightfully worried about the effect the lockdown would have on their businesses.
“While many big corporates may have efficient contingency plans in place, it is the small business that will get hit the hardest by this lockdown,” said Shannon.
According to Servest sales director Khanyiso Myathaza, about half of South Africa’s businesses in the small to medium sector could survive, and the surviving half would do so by being able to adapt to the new norms brought on by the lockdown restrictions and those which would exist beyond it.
“Many small businesses have already started to adapt by expanding their portfolio to catering to the new market for hygeine products, so I suspect many will start to follow suit and find themselves somewhere in this value chain.”
Shannon advised small businesses to adjust their business models to fit the new normal.
“By necessity businesses will need to adapt and some of these adaptions will stick as new ways to do business long after the Covid-19 dust has settled,” said Shannon.
“This is an opportunity to think about how you do business differently, not just for now, but for the longer term.”