BLOG – The Impact of COVID-19 on SMEs Operations

Is COVID-ERVERSARY now a thing?

It’s been a year since we went into lockdown. With businesses being negatively affected whilst others prospered, it’s all been a great deal of change for SMMEs. Almost every conversation around this pandemic leads to the daunting topic of how SMMEs have been affected by COVID-19.

It’s official.

For a better understanding, an official study was conducted by Survey Fiesta in collaboration with SEDA, PPC, Edge Growth, ProfitShare Partners, INSETA, SiMODiSA, Secha Capital, Business Financial Solutions, BEDCO, and CEDA to learn more about the challenges brought by the COVID-19 pandemic. This research looks into understanding SMMEs efforts to mitigate the effect of COVID-19 on business activities in the near future.

Digital transformation.

78% of SMMEs agree that the COVID-19 crisis has impacted their long-term need for digital transformation within businesses.

Our CEO shares his advice with clients and other SMMEs; this crisis has accelerated digital transformation.  His view is that every business should adopt the change and realise how crucial it is to operate and offer its services online, with fulfilment capability and possibly even delivery. “Small businesses have discovered that they don’t need certain infrastructure, which they thought was critical and thought they needed as recently as a year ago. Marketing, especially digital marketing, which can more accurately target your client base at relatively low cost, now becomes more critical to your business’ success,” he says.

What’s over the hill?

SMMEs believe that business operations will resume as usual whilst a 1/3 of them think it will radically change. We beg to differ and take a stance with a 1/3 of the respondents. There has been a rapid digital transformation over the past year. Thanks to automation and ease of the online world, businesses can become more efficient and agile, thus delivering more to the end-user. That’s certainly worth it.

How we adapted.

More and more SMMEs have found it difficult to raise funding from traditional sources, and they have been a significant contributor to our business growth. This business growth, in turn, leads to exponential growth in the staff complement. Because most of the processes were simple, hassle-free and predominately online, the transition during this phase was reasonably easy. However, our dedicated teams’ most important contribution was embracing online meetings and working remotely, almost overnight. As a company, we had to ensure that our employees had fast and reliable internet to work from home. Mental well-being during the lockdown was and still is a huge concern. We strongly feel that working from home will positively affect promoting work-life balance and, most importantly, quality time with their loved ones. Still, we will require physical time with our colleagues to promote camaraderie and a quicker sharing of ideas.

 

BLOG – The Impact of COVID-19 on SMEs Operations, ProfitShare Partners

Driving innovation.

Just over half of SMMEs suggest that their organisation had to develop a new product/services and/or introduced initiatives to connect with their customers better due to the Coronavirus crisis.

Our clients and community reap the benefits too.

With our employees being in a great space, we also felt the need to assist our clients as best we could and spread positive energy wherever we could. We were awarded a generous grant from an international bank, and we wanted to use that to ease the pressure of our clients whose cashflow suffered during this time. A number of our clients benefitted from payment holidays, rent or salary relief. As an added value, we offered complimentary legal and accounting services. Through these initiatives, we assisted our clients in applying for COVID grants. PSP didn’t want to stop there. We helped as many businesses with PPE and tried to feed as many needy families as possible with our food hamper initiative.

From the survey.

The results from the study reveal that 50% of SMMEs suffered a significant negative impact; just 7% reported none, while 6% of the respondents actually saw a slightly positive impact.

PSP is grateful to be among that 6% and looking forward to taking on the important work of getting South Africa working and driving economic inclusion in 2021.

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