COVID Chronicles: The collapse of SA’s small businesses

It is the latest in a five-part podcast series by ECR's sister station, Jacaranda FM, commemorating five years since the country's hard lockdown.  

Listen to the latest episode below:

 Lockdowns were a new phenomenon for most South Africans and soon became a horror story for most small and medium enterprises. 

The Small Business Institute’s chief executive officer, John Dludlu, says although the government’s intervention was understandable, it might not have been appropriate. 

“Government shut down sectors; it did not shut down activities. So that impacted heavily on SMEs,” he says. 

“[The Small Business Institute’s] Impact Assessment was that SME owners and SME workers, customers, were heavily smacked by that early phase of the shutdown because it sought to regulate and police sectors, not activities.  

“If you took the sector approach, you then ended up shutting down some of the activities that are leaning themselves to social distancing. By their very nature, small businesses had far fewer people employed than big businesses. So if allowed to operate, you would have the possibility of them continuing to apply those safety measures.”

Hannelie Duckitt, Lizaan Dimeney, and Marissa Jooste have first-hand experience with the impact of the lockdown. 

Hannelie and Lizaan’s Picasso Beauty Salon were shut down during the lockdown. 

At first, they welcomed a quick breather, but then things quickly changed as the restrictions were extended and extended. This left them with no income, but bills still had to be paid. 

“We tried to pay with money we still had; our domestic workers needed money. I mean, it's not their fault; they're sitting at home, and food is what we did, so everything else stopped. Car payment stopped, building payments, house payments stopped, and your water and electricity— you obviously had to pay because they'll just cut you off in the middle of COVID,” said Hannelie. 

“I had a little bit of savings that I could use for the first month or two, but after that, nothing was left, so luckily, my fiancé helped,” said Lizaan.

Similarly, Marissa owns a coffee shop inside a hospital in the East Rand. Despite the fact that the hospital was open and beds were full, she had to close her shop. After three weeks, she was allowed to return to her shop, at which point most of her stock had expired and had to be thrown out.  

Even though she was allowed back into her shop, she had no one to sell to because visitors were not allowed, and staff members would use the hospital’s canteen.

Her luck partially turned around when the hospital suspended her rent payments, and they negotiated that staff would only be able to buy food from her shop, but at a discounted price. 

Dludlu admits that no one knew how to deal with the impact of the pandemic.  

However, looking back, the government made a mistake by shutting down complete sectors and not regulating specific activities. 

Listen to all the episodes in this special limited podcast series on the channel below: