The Black Entrepreneur’s Alliance has called on the government to provide financial help for
SMMEs to avoid job losses
Eskom’s load shedding is crippling small businesses, leaving thousands of owners facing a
crisis and the difficult decision of whether to keep their doors open at higher cost during the
rolling blackouts, or to place workers on short time to make ends meet.
Black Entrepreneurs Alliance (BEA) founder and chief executive Refilwe Monageng has called
on the government to step in to assist small businesses as he warned that Eskom’s recent
regime of Stage 4 and Stage 6 load shedding is placing the financial viability of the country’s
thousands of small businesses, and jobs, in jeopardy.
Cost to SMME’s
He said load shedding was costing small businesses thousands of rands in losses when
refrigerated stock temperatures drop and equipment gets damaged during unexpected
power surges. He said increased overhead costs and lost business hours were also hitting the
bottom line.
“Unlike large corporates and medium sized firms most small businesses do not have
sufficient savings to explore alternative energy sources, such as solar power, nor the funds to
invest in powerful diesel run generators to keep the lights on and their doors open during
long periods of load shedding,” Monageng said.
According to an Organisation for Economic Cooperation and Development 2022 report there
are 2.6 million small, medium and micro enterprises (SMMEs) in South Africa of which 37%
are considered formal.
“Those more well established small businesses owners who do manage to source generators
to keep their businesses open are finding that the exorbitant price of diesel is ramping up
their operational costs and making it difficult for them to pay their staff without increasing
the prices of their goods and services for their customers who are already struggling,” he
said.
Township Trade hit hard
Monageng said that for example, small township businesses that rely on walk in trade from
hair salons, printing shops and locksmiths to taverns and superettes were facing a crisis due
to the rolling blackouts. Small businesses are also not able to complete their paperwork for
tenders, customer quotes and invoices on time due to the loadshedding, which led to a
further loss in trade for owners.
“Most modern businesses rely on electricity for technology, lighting and machinery and
owners simply cannot afford to keep paying their staff to be at work when services cannot
be rendered to customers for several hours every day. Some small businesses are choosing
to simply close their doors during load shedding to avoid higher costs but this too obviously
leads to a massive loss in trade,” Monageng said.
Monageng said that it was government corruption and poor planning over recent decades
that had led to the near collapse of Eskom and resultant load shedding, and that small
businesses should not have to bear the brunt of the crisis.
A Life Line
“We urge the government to throw a life-line to small businesses during the 2022 tax year
and to reduce our taxes or at least provide us with some sort of reprieve or rebate for the
hours of lost trade during load shedding. It would also be helpful if the government could
assist small businesses with the cost of the purchase of generators or solar panels, in the
form of an energy grant, to help them to keep the lights on and their workers employed full–
time,” Mongageng said.
