SME turnover increases by another 4%
THE YOCO Small Business Recovery Monitor showed that small- and medium-sized (SME) business turnover increased by another 4 percent in the week to May 19, up to 44 percent of pre-covid-19 turnover levels countrywide.
SMES are facing severe financial difficulties during levels 5 and 4 of the lockdown, as they have to continue paying rent, salaries and other operational expenses while forced to close.
Yoco, the distributor of point-ofsale (POS) devices to more than 80 000 merchants who operate mainly small businesses, launched the Small Business Recovery Monitor this month, and, as far as is known, it is the only live, publicly available small-business transaction data resource.
The index can be used by entrepreneurs to benchmark performance and aid decision-making through what is likely to be one of the toughest trading periods for any company. The index tracks the recovery of small businesses in South Africa through the lockdown and thereafter. The index uses the number of transactions through POS devices two weeks ahead of the first case of Covid-19 in South Africa as the 100 percent baseline against which to compare current small business turnover and economic activity.
Yoco said yesterday that the increase in the index over the week was driven by improvements in both the food, drink and hospitality industry (5 percent) and the retail (3 percent) industry.
“These improvements are testament to more restaurants pivoting to offer delivery and pickup services, as well as the supply of meal boxes and frozen meals,” the company said.
The opening up of e-commerce in totality (except the sale of alcohol and cigarettes) on May 14 had also driven up retail numbers, as businesses shift to selling online and arranging contactless delivery or collection. Previously, e-tailers were limited to the same approved item list as physical stores.
Changes to level 4 regulations include a mandate for e-tailers to promote local goods and produce, which has had a positive impact on retail numbers for small businesses.
Provincial improvements in the index were driven by significant increases in SME turnover in Kwazulu-natal (KZN) (5 percent), the Western Cape (4 percent), Limpopo (4 percent) and Gauteng (3 percent).
The KZN increases were a factor of large improvements in retail turnover in this province, with retail SME turnover levels breaking 80 percent of the pre-covid-19 reading for the first time.
Limpopo was the second province (after Northern Cape) to pass the halfway point of recovery, with SME turnover eclipsing the 50 percent mark of the pre-covid-19 levels for the first time this week. This had been driven by improvements across all sectors, with retail passing 90 percent and food, drink and hospitality industry at almost 75 percent recovery.
Gauteng and Western Cape both saw improvements across all sectors, with retail, in particular, settling between 60 and 70 percent of the precovid-19 levels.
A shift in shopping trends was seeing turnover peak on Friday, as opposed to Saturday, the beginning of the weekend. The drop-off in trading over weekends had been a recurrent theme through the month.