SMEs past midway to recovery

THE YOCO Small Business Recovery Monitor showed all provinces had breached the halfway point to recovery as the average turnover of smalland medium-sized businesses (SME) increased 9% in the week to June 3, bringing the index up to 56% of preCovid-19 levels countrywide.

The recovery was strongest in the three days since the move to level 3, where turnover had ranged from 65 to 67% of the pre-Covid levels.

Most SMEs could open this week after facing severe financial difficulties through levels 5 and 4.

Yoco, distributor of point-of-sale devices to more than 80 000 merchants who operate mainly small businesses, last month launched the Yoco Small Business Recovery Monitor, which tracks the recovery of small businesses in South Africa through the lockdown and thereafter.

Provincial improvements were driven by extremely strong increases in the Northern Cape (+15%), North West (+13%), and KwaZulu-Natal and the Free State (+11%). The Northern

Cape was back to 73% of turnover.

The monitor showed that the move to lockdown level 3 had the biggest effect on the food/drink industry, which rose 11% as restaurants reopened for pick-up and delivery, while retail continued its strong recovery, at 74% of the pre-Covid level.

However, the health and beauty industry showed little improvement with a 4% increase to 40%. Beauty salons, hairdressers and barber shops had been almost completely shut down, with turnover close to just 10% of the pre-Covid levels. The monitor found SME hardware stores had benefited from the lockdown, trading at close to 150% of pre-Covid levels.

Other sub-segments, which had been largely unaffected in lockdown level 4 were computer games/accessories, pet stores and automotive parts.

The sub-segments with the biggest negative impact were high value retail such as jewellery stores, art dealers, antiques and sporting goods. These were also segments, which tended to use weekend and craft markets to trade, none of which were open, the monitor found.

High touch environments such as nightclubs and bars, as well as wine farms and food markets saw turnover at less than 10%. Food trucks were closer to 50% of the pre-Covid turnover, together with bakeries and caterers. In contrast, despite its high touch nature, dentistry was less affected than other sub-industries, with close to 90% of pre-Covid turnover.

Vets appeared to be benefiting from the lockdown, with independent vet turnover at 125% of the pre-Covid levels.