Nearly 90% of businesses destroyed in looting were SMMEs and 7% will not reopen
- 89% of businesses impacted by the recent looting were SMMEs, according to research
- 7% of SMMEs will not be reopening
Lins Naidoo talks to Africa Melane about the research released by Redflank's BeyondCovid.
Small and medium businesses have already been impacted by Covid-19 lockdowns and now in KZN and Gauteng have been hardest hit by the recent looting and civil unrest.
The survey reveals that operational funding of R16 billion is needed for those businesses to recover.
Some 7% of SMMEs say they will not be reopening, says Naidoo.
Much of the television coverage focused on the big entities being impacted in the looting rather than the small and medium businesses.
The SMMEs don't make the headlines or the graphics, but if you look a the impact on revenue, businesses across the board have dropped by 59% but it gets progressively higher as you get to the smaller entities. SMMEs have lost 63% of their revenue, informal enterprises have lost 70%.Lings Naidoo, Director - Redflank
For SMMEs this loss amounts to R3.4 billion in monthly revenues. This is where the real tragedy lies.Lings Naidoo, Director - Redflank
He says more than half of businesses that were impacted have closed.
7% have closed permanently. And if you dig into that number, the bulk of that 7% is going to be SMMEs.Lings Naidoo, Director - Redflank
Since the start of Covid, which is the broader context in which the riots have occurred, 110,000 SMMEs have closed their doors. The challenge is very few have insurance.Lings Naidoo, Director - Redflank
62% of businesses damaged in the unrest have no insurance, he notes.
They are not going to spring back on their own which is why the funding is critical and they are not going to get it from the bank. it has to be from government.Lings Naidoo, Director - Redflank
Source : Picture: Abigail Javier/EWN