The Liquor Traders Association of South Africa (LTASA) is “respectfully” urging government to lift the current liquor ban next week, saying government’s task of balancing lives and livelihoods is not being fulfilled by pushing ahead with such a “blunt tool”.
They are asking that government allow for alcohol to be sold to consumers to be enjoyed at home.
The country is still under a State of Disaster, which was extended to 15 January 2021 in December 2020.
LTASA employs more than 14,000 workers, and operates more than 1400 retail liquor stores.
Many LTASA members are small-to-medium enterprises. All members make “a very substantial” financial contribution of 4.4% with a 2.08 multiplier effect to the economy, and form part of a value-added chain with multiple other businesses dependant on liquor outlets for survival, the association explained.
The association is calling on government to accurately distinguish between drinking at home and drinking in public.
Private consumption means social distancing is achieved, large gatherings are avoided, and people do not drink and drive. Public alcohol consumption, however, means no social distancing, results in large, unavoidable crowds, and the possibility of driving under the influence.
“The off-site consumption liquor sector is a sector that could easily and safely be reopened, while continuing to adhere strictly to all safety health protocols and social distancing measures.”
LTASA outlined that severe financial losses, job cuts and wage reductions have caused the sector to reel since March last year.
“Our members are struggling to survive, and if they close, the job losses will be catastrophic,” they said.
Together with the first bans implemented last year, LTASA said the sector had been closed for a total of 100 days.
But just because booze sales were banned, it did not mean that expenses could be defaulted on.
Paying salaries, wages, rent, insurance, security, IT and financial costs had crippled alcohol players’ cash flows, and decimated savings and reserves.
“The subsequent sudden announcement of an additional suspension on the sale of liquor on 28 December 2020 has left our members in dismay.
“Another period of zero income, ongoing expenses and stock that is expiring will result in crippling damage to cash flow, and many stores are on the brink of closure.”
Many salaries would not be paid in January, LTASA’s members told the association, and a “significant number of employees” now faced retrenchment.
Many of these workers are unskilled or semi-skilled, which LTASA said could harm their future job prospects.
Expired stock would also cause “irreversible damage” to businesses if it could not be sold soon.
Business owners were also struggling to pay their monthly rental fees, which was essential in order for a store to have a valid liquor licence.
As if the bans were not enough, LTASA said its members were also suffering losses due to break-ins and store looting.
“The sudden new ban will increase the risk of this criminal behaviour and result in further devastating losses.”
Requesting financial assistance
If the ban is to continue, LTASA has asked government for financial assistance in the form of ongoing Unemployment Insurance Fund (UIF) support.
They have also called for rental relief, asking that tenants be able to negotiate a reduction in rental, due to stores being reduced from trading to storage facilities.
They were also requesting that their members be compensated for all expired stock and the financial consequences associated with this loss of income.
“If our members cannot sell the stock in their stores to get the cash to replace it, most of them will not have the resources to buy new stock and get going again.”
Off-site consumption, for LTASA, was the most logical method of keeping the alcohol sector going, as well as its extensive value chain.
They argued that it could be regulated easily, and were appealing for off-site consumption alcohol sales to be reinstated, as it was in previous disaster management regulations.
Compiled by Nica Richards