As we get into level 1 of a nationwide lockdown, the government is faced with an increasing budget deficit while battling to support economic recovery.

The pandemic has brought about an imperative need to save lives and safeguard jobs, and governments around the world are scrambling trying to put together the right solution. It is estimated that the unprecedented need for relief and stimulus spending just as the economy was contracted will drive the global government deficit up to $9 to $11 trillion in 2020.[1]

Governments must balance the management of this deficit with economic recovery without drowning the economy. It is a bit daunting, but we have survived an economic downturn and we need to believe that we can survive this one too. The recovery of the economy will require the government and the private sector to work together towards a common goal. We need to lay a foundation for a commonly shared outlook of the postcrisis sustainable economy.

SMMEs are always seen as the backbone of the economy yet they are the least resilient in a time of crisis.

There are actions SMMEs can take with the help of the government and the private sector to  survive after the pandemic

Design clear market entry strategies (Economics 101)

SMMEs need to clearly define their go-to-market strategy to increase their market share so they can reduce the risk of depending on a few clients. If, for example, an SMME has a better understanding of the market conditions to be able to identify areas where they can increase demand for their products.

If they can identify factors affecting the demand for their product then they can focus on new target markets that will sustain the demand for their products. Understanding market demand forces will assist them to understand how to re-engineer their product offering to adapt to fit other markets.

Government and the private sector need to empower Business Development Service Providers (BDSPs) to create programmes that are specialized to assist SMMEs to access new markets instead of just assisting them to change their offering based on any new demand.

A lot of SMMEs became suppliers of personal protective equipment which means that they had to temporarily abandon their current main product offering; this was convenient but access to more markets would be ideal.

Achieving operational efficiency to manage growth

SMMEs that are on a growth path face a problem of not being able to scale up to that growth. The answer to this is operational efficiency.
Apple was the first company to hit the $2 trillion market capitalisation [2]. This was not achieved because of the amazing products they sell; this was achieved by the implementation of operational efficiency.

Money needs to be invested in business development service providers (BDSPs) who provide business development services to SMMEs. C4G is a catalyst of operational efficiency because we assist BDSPs benchmark the performance of their programmes, eliminate waste by improving the performance of their programmes, and our platform allows them to monitor and manage the performance of their SMMEs who are part of their programmes.

Being able to monitor all this data will assist funders to identify programmes that are more efficient to assist SMMEs.

Drive research and development for innovation

Research and development are very important for growth and innovation. Any successful corporation has recognised this need, which is why they have entire departments dedicated to this.

Malaysia has a platform called PlaTCOM Ventures which helps entrepreneurs turn their ideas into products and services[3]. South Africa needs such a platform so that it becomes easy to identify high growth businesses for funding and support even in a pandemic like this.


There is a lot of value that South Africa can derive from a growing SMME environment. The African proverb ‘It takes a village to raise a child’, has never been as relevant to business as it is now. It is going to take a collaborated effort to rescue the economy and the first place to start is with rescuing SMMEs. The national lockdown has shown us how the common good can be achieved by working together.

Khodani Madi
C4G


[1] https://blogs.imf.org/2020/05/20/tracking-the-9-trillion-global-fiscal-support-to-fight-covid-19/

[2] https://www.cnbc.com/2020/08/19/apple-reaches-2-trillion-market-cap.html#:~:text=Apple%20first%20reached%20a%20%241,most%20valuable%20publicly%20traded%20company.

[3] http://www.platcomventures.com/

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