How have small businesses fared during the COVID-19 lock-down?

The COVID-19 pandemic has had a devastating impact on small and medium-sized businesses around the world, with some unfortunately having to shut their doors permanently. As small businesses navigate the challenging environment brought about by the pandemic, digital transformation has become imperative for their survival. In light of this, Yoco, a company that provides card machines and online payment tools to over 80,000 small businesses, has launched a Small Business Recovery Monitor. The monitor tracks and compares card transaction volumes to pre-pandemic levels, offering valuable insights into the recovery of small businesses in South Africa. In a recent interview with CNBC Africa, Katlego Maphai, the CEO of Yoco, shared some key insights on how small businesses in South Africa are faring amid the pandemic and the road to recovery. According to Maphai, the Small Business Recovery Monitor compares transaction volumes to a baseline from the first two weeks of March, before the implementation of social distancing measures. At the peak of the lockdown (level 5), transaction volumes dropped by as much as 90%, with only 10% of businesses transacting across the country. However, as South Africa has moved towards level one of the lockdown, there has been a significant improvement, with transaction volumes almost back to full recovery, and in some cases, exceeding pre-pandemic levels. Yoco's index covers over 100,000 businesses across the country, with an average turnover of about 20,000 rand per month per merchant. Maphai highlighted that the recovery of small businesses varied by province, with the Western Cape still lagging behind due to the lack of international tourism. In terms of industry segments, retail businesses have fared relatively well throughout the crisis, while sectors like health and beauty, as well as food and beverage, initially struggled but have shown signs of improvement. When discussing the empowerment of small business owners and the importance of ownership, Maphai emphasized the value of including workers as shareholders in the business. He shared that the majority of Yoco's team are shareholders, giving them a sense of ownership and dedication to the company's success. Maphai advocated for a shift in the approach to empowerment, moving away from simply dividing existing resources to creating new opportunities and segments for participation, ultimately driving growth and innovation in the small business landscape. In conclusion, as small businesses continue to navigate the challenges posed by the COVID-19 pandemic, digital transformation and a focus on employee ownership and empowerment will be critical in driving recovery and sustainable growth. Yoco's Small Business Recovery Monitor serves as a valuable tool in monitoring and supporting the resilience of small businesses in South Africa, offering insights and data-driven strategies to help them weather the storm and emerge stronger in the post-pandemic era.