SMEs zone in on digital growth as they chart future
Small, medium and micro enterprises (SMMEs) in SA say upskilling staff and growing digitally will help drive business in a post-COVID-19 world.
This is according to the Mastercard SME Index, which surveyed 300 SMMEs in SA between April and mid-May 2021.
The COVID-19 pandemic and subsequent nation-wide lockdown disrupted businesses across most sectors, putting people’s livelihoods and SMMEs, in particular, under tremendous pressure.
According to the Mastercard Index, the majority (84%) of South African SMMEs say the pandemic has negatively impacted their revenue. However, 79% are projecting that their earnings will either hold steady or grow in the next year.
Based on the global payments and technology company’s index, 58% of SMMEs identified upskilling staff as the top area that will offer the highest growth potential for their businesses.
In addition, 57% of survey respondents listed access to better data, analytics and insights as the next area of importance to boost future growth.
According to the index, 53% of the SMMEs noted digitising business operations, sales and admin as the third area that will drive business. The acceptance of digital payments across multiple channels (48%) came in fourth place.
Rounding up the top five drivers for future business growth, 48% of SMMEs identified the ability to do business and transact internationally as a key feature.
“SMMEs in South Africa continue to demonstrate strength and agility, despite COVID-19, where they’ve had to navigate lockdowns, restricted supply chains and the changing habits of an evolving consumer,” says Suzanne Morel, country manager for Mastercard SA.
“While several challenges remain, it is encouraging to see how SMMEs are transforming the way they do business to benefit from the secure technology and convenient payments solutions that are currently shaping commerce.”
When asked about what keeps them up at night, 39% of SMMEs in SA mentioned being able to maintain and grow their business, while 29% are worried about their ability to stay in business, or going bankrupt.
Looking ahead at the next year, three-quarters (76%) identified the rising cost of doing business, 63% cited red tape and regulations, and 51% mentioned getting access to capital as their biggest business concerns.
Private sector partnerships (84%), international government or business collaborations (56%) and government-led initiatives (44%) were identified as having the biggest potential to positively impact SMMEs and the wider South African market.