Small business tips for the COVID-19 pandemic
Get tips to help your small business succeed during the pandemic.
Business tips for the COVID-19 pandemic in South Africa
Small businesses need all the help they can get from the public and private sectors to survive the pandemic and the future. This pandemic has been financially challenging to many businesses in South Africa. Many small businesses can't handle tough times mainly because of insufficient cash reserves and their small number of clients.
Not only has the South African economy been shrinking, but COVID-19 came along with all its problems. Lockdown controls have throttled income, forcing some small businesses to go into survival mode by cutting back.
Enough of all the bad news! Cheer up because there is always a way out. Small businesses can beat these challenges. So, let's all make it through the pandemic. Also, let's all remember to obey all the health and safety requirements to keep everyone safe.
The heart of the South African economy
Overall, small and medium-sized businesses make up 98% of all businesses and employ between 50% and 60% of South Africa’s workforce. They are the heart of the economy.
We have to be realistic and talk about some challenges small businesses face.
There is nothing better than hearing some first-hand experience. So, we spoke to a small business owner, Sandy, who makes corporate videos and animations, about how the pandemic affected his business and how he is now working on getting back on his feet.
Read what Sandy had to say about his experience and how he has stayed strong since the pandemic started.
How did the pandemic impact your small business?
“For me, it was a direct impact because, on level 5 of the lockdown, my business wasn't considered an essential service, so I was not allowed to operate outside of my house. I must be outdoors and among people to work in the filming industry. Level 4 and level 3 of the lockdown restricted a lot still for the filming side of my business.
“I lost 30% of my turnover in the first year of the pandemic. I've been working on a business recovery plan ever since. So far, my business has now recovered about 16% of that 30%."
How did you adjust the services you offer to survive a pandemic?
“So the great thing about that is I focused a lot on the online market. How I could deliver services online and work more on digital marketing-related video production.”
Has your business recovered since the pandemic started?
"I managed to move online, so I've managed to really use the online or animation or the digital marketing side of the business, which really helped me run regardless of its lockdown level. So I haven't been able to do a lot of that.
"Another big component is that I've joined an online network referral system. At the time, I was able to function online. So I've managed to grow my network online, which is rewarding. It has helped me recover a lot of my business. I've been able to network a lot and then give and receive referrals, which has been amazing because a lot of my work is still word-of-mouth. In fact, I spend very little money on marketing and most of my turnover from word-of-mouth."
What business lessons have you learnt from the pandemic?
"I've learnt that cash flow is king. Not even cash is king because you can't pay your bills with money still owed to you. I had very little cash flow, and so as a business, I wasn't financially prepared for a pandemic.
"Another lesson that I learned as an entrepreneur is, small businesses are only as good as your mental state or mental health. So if you ever want your business to recover, you first have to make sure that you can recover. Not being able to earn an income and not being able to work has a huge impact on your mental health.
"I learnt a third valuable lesson: to be more adaptable. Just because you do one thing a certain way today doesn't mean it will stay that way. So the more adaptable and flexible you can be as a business, the more resilient you are to change.
"You should have a good business network, and you cannot live in a silo. You cannot operate a business today without having a big, growing network.
"My last lesson is to have a good accountant to help you through these tough times. Your accountant or financial adviser should be able to get a good cash flow place. I think you need someone looking out for you and looking at how you can best manage your business's finances."
How prepared is your business for the next pandemic?
“So I think there are two parts to this question. First, in the sense that from the state of mind, from the business strategy point of view. I'm way more prepared and resilient because a lot of my business is running online or digitally. So it's a lot more lockdown resilient or lockdown resistant.
"Second, the cash flow situation is not quite where it should be. I've got to be able to have spare funds to survive at least 3 months with little or no work. At least from a business strategy and an operations point of view, the business is in a much better place and better prepared."
Sandy inspired us with his practical tips from his experiences and how he stayed positive during the most challenging times of the pandemic. Read on to get more tips.
Learn more business tips for the pandemic
What else could small business owners do to overcome today’s challenges?
COVID-19 Business Guide
Find out more COVID-9 Business Guide.
Use new technologies
Small businesses can use digital and new technologies to focus on their area of competition and operations and use them to enhance their success. Also, by increasing their efficiency, they can lower costs. For example, simplifying managing your business with the right app, like the free Yoco app.
Look for new opportunities
A company shouldn’t have 'all their eggs in one basket. Through improved strategies, it could possibly access more customers. Becoming aware of new market areas will allow it to gain a foothold in such markets. Thinking out of the box may give the business access to a new and rewarding niche.
Work smarter, not harder
Many small businesses focus on bettering sales and earning more cash. But you want your company to operate more efficiently to improve your competitiveness over other companies. Your company can achieve much more with the same resources. Watch how much time you and your staff are doing which tasks. Find out in which areas your business is losing time, money, and resources.
Investing more in people
You may have the fanciest office with all the bells and whistles of computers and their systems, but what is it without experienced staff? Investing in yourself and your team is the best thing you can do.
Everyone in a small business needs to develop skills. It would be best to empower managers and leaders you can trust and who can successfully take various areas of your business to greater heights. Distribute the workload more evenly, giving those who may not have stood out before a chance to succeed. In this way, you can free up some key staff to do vital tasks.
Having no access to extra cash can be devastating to any small business trying to survive a pandemic. Find the best way to get enough funding that best suits your business. For example, with Yoco Capital, qualifying Yoco merchants don’t have to worry about monthly debit orders with Yoco’s cash advance. Instead, a fixed percentage of every sale pays off your Yoco Capital.
The future is yours
Don't give up. You and your business can make it through these challenging times and on to great success.