Sen­si­ble in­ter­ven­tions can save firms

Financial Mail - - YOU SAID... - Adam Craker CEO, Iqbusi­ness, Joburg

Fi­nance min­is­ter Tito Mboweni said in his emer­gency bud­get last Wed­nes­day that SA will need to bor­row $7bn to cover its bud­get deficits in the tough years ahead. He has warned that we will have to al­lo­cate just un­der a quar­ter of our fu­ture tax rev­enue to­wards ser­vic­ing the grand debt we are amass­ing.

Noth­ing can pre­vent the eco­nomic tsunami that lies ahead — but there are pro-bono, home-grown and prac­ti­cal in­ter­ven­tions avail­able to busi­nesses that find them­selves in dis­tress.

The Co­bra Ini­tia­tive, for ex­am­ple, is a lo­cal not­for-profit body seek­ing to help al­le­vi­ate some of the strug­gles busi­nesses in SA face. It as­sesses what form of as­sis­tance each in­di­vid­ual busi­ness needs and then de­vel­ops prac­ti­cal steps for its sur­vival.

This ap­proach con­fronts the fact that not ev­ery busi­ness will still ex­ist af­ter this cri­sis — and that busi­nesses fac­ing demise should fold quickly to pro­tect their un­der­ly­ing as­sets as a re­source base to start some­thing new.

In some cases, busi­nesses might have to moth­ball op­er­a­tions, hi­ber­nat­ing while the virus spreads. Oth­ers will sur­vive by piv­ot­ing their of­fer­ings to­wards new mar­ket op­por­tu­ni­ties.

Mboweni said an “ac­tive ap­proach” could lead to the cre­ation of jobs and a re­duced cost of do­ing busi­ness — which would help SA build a new com­pet­i­tive econ­omy.

With a ro­bust strat­egy to tackle the road ahead, there are glim­mers of op­por­tu­nity. Busi­nesses can find sta­bil­ity and growth de­spite the dire eco­nomic out­look and nar­row gate ahead.

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