As social distancing is becoming more and more encouraged and implemented - restaurants, pubs, hairdressers and retail outlets are emptier than they have ever been.
Many tour companies have shut down completely - as there are simply no tourists coming into the country.
Restrictions put in place by government have seen many events (even weddings) cancelled and postponed.
From photographers to caterers to toilet suppliers - every service provider attached to these cancelled events will suffer.
This does not only negatively affect the owners of the companies, but all their employees as well.
Many employees have seen their salaries cut, their hours of work adjusted and many have been laid off already.
It seems we are in for some dark times.
Yet, there is light at the end of the tunnel for small businesses.
The Department of Small Business Development is establishing a debt relief fund to help ease the economic impact caused by the Coronavirus on small, micro and medium enterprises (SMMEs).
Minister of Small Business Development Khumbudzo Ntshavheni has said that the fund is aimed at providing relief on existing debts and repayments.
“For SMMEs to be eligible for assistance under the debt relief fund, the applicant must demonstrate the direct link of the impact or the potential impact of Covid-19 on business operations,” she says.
“This facility will also assist entities to acquire raw material, pay labour and operational costs. All these interventions will be structured to match the patterns of the SMMEs’ cash flows, as well as the extent of the impact suffered “
A platform created by the Department of Small Business Development will go live on Tuesday, 24 March.
On the corporate front, Standard Bank has also put in place relief measures for small businesses.
One of these measures is the Coronavirus Business Interruption Payment Scheme, which will provide payment relief for small business for 90 days.
Essentially, from 1 April a Standard Bank small or medium business will have a “payment holiday” of three months, provided that the following conditions are met:
- Your business is based in South Africa
- The turnover is no more than R20 million a year.
- Your business account is up to date.
- Your business is in good standing.
It is important to note though, the interest and fees accrued over this period will be capitalised on the client’s account.
Once the 90-day “payment holiday” is over, the complete new repayment will become due.
Whilst I am extremely grateful for the help being offered to the more formalised small business sector, I am extremely concerned about the more informal, “run from home” businesses that we have in our communities. There are many!
Many small businesses need daily cash to keep their doors open.
Here is what we can do to comply with social-distancing, but still support local small businesses:
- Whether it be food or clothing, place orders online and collect it at the door (of the business).
- Use the in-house or outsourced courier service supplied by many small businesses these days. Use Uber Eats and Mr D. for restaurants.
- Don’t cancel an event, rather postpone it and keep in touch with all service providers.
From the business side, to ensure customer service in the time of Coronavirus - they should:
- Ensure that their spaces - including all counters and equipment - are clean and sanitised.
- Have sanitisers on hand for customers and minimise transaction interaction by rather tapping cards than handling cash.
- Have staff wear masks. It places the customers at ease.
With things becoming more quiet, now is the perfect time for small business owners to give their business a thorough assessment.
The same goes for individuals:
- Take out all documentation related to invoices and payments.
- Check to see what the interest rates are from all your creditors. Know who you are paying the highest and the lowest interest too.
- Draw up a budget.
- Get back to distinguishing what a need and a want is.
- If you are by the means, employ a bookkeeper and a tax consultant to help you get all your business (and personal) finances in order.
- Do not panic buy, especially if you don’t have lots of reserve money that you can pay for it from.
- Do not use a credit card to stockpile goods. You are still going to have to make payments on that card.
We are all in for some tough times. The recession is real.
The Coronavirus and its impact is real. We have to be responsible citizens and work together with authorities to help flatten the curve (stop the spread of the virus at a rapid rate).
We should adhere to the call for social distancing, being isolated isn’t lekker - but it’s better than sick and dead!