Measuring and understanding what is working for SMMEs

One of the COVID -19 messages that the small businesses community have put out over the last few months,  is the need for the private sector to increase access to markets by choosing SMMEs as their primary service providers/contractors, citing the benefits of using small business rather instead of large corporates including:

  • Lower overhead costs
  • Less bureaucracy
  • Quicker implementation/turnaround times
  • Improving their BEE scorecards

The other call is around more investment towards:

  • Small business infrastructure in the industries that are being evidently advanced or boosted by Covid-19, with technology and health care being amongst the most obvious
  • Formalising informal businesses
  • Aligning business support programmes with the changed economic and industrial environments

The easing of South Africa’s lockdown to level 2 opens up the following key markets:

  • Restaurants: food services, cleaning, and hygiene services
  • Hospitality and conferencing: food services, cleaning, and hygiene services; Technology, transportation
  • Entertainment services: food services, cleaning, and hygiene services; Technology

The C4G Small Business Support Ecosystem Report (SBSER) 2019 sample data showed these sectors collectively making up around 40% of the market share, a critical percentage if this is reflective of the real picture out there.  It will make it all the more important to monitor and understand how the reopening of businesses affects the economy and more directly, translates to:

  • Decisions made by the private sector around where to intentionally source services from (thereby creating/growing markets)
  • Decisions made by investors around where to direct their finance too
  • The understanding that the business support community demonstrates and the direction it takes regarding making relevant adaptions to programme design and implementation.

We cannot overestimate the importance of measuring, evaluating, and adapting the impact of the business support community on the SMME environment in South Africa and the broader continent.  The more intentional and collective these efforts are, the greater the potential for higher impact on small business.

N Langa
C4G

Sources:

  1. GEN 22 on Sloane “Covid-19 Impact on South Africa’s SMMEs” April 2020 – PG 20, 24
  2. C4G SBSER 2019 “The Role and Impact of Business Development Support (BDS) Services on South African SMMEs” March 2020 – Figure 7

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