Study reveals how severely Covid-19 has affected businesses
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Pretoria - A whopping 76% of businesses that responded to a national survey on the impact of the Covid-19 pandemic on their operations have seen their revenue shrinking.
In addition, 23% have had to shut down, temporarily or permanently.
The findings are according to a survey, which revealed that over half of participants across all sectors were currently operating under their normal capacity.
For just 2 in 10, it is business as usual, while only a tiny fraction (2%) has grown its operations.
According to the findings of the new BeyondCOVID Business Survey conducted between June 7 and August 22, 76% of the over 1 800 participating companies have seen their revenues drop since March.
Lings Naidoo from Redflank said sectors most affected were accommodation and food services outlets (93%), construction (89%), arts, entertainment and recreation (87%), service providers such as hairdressers and beauty salons (86%), wholesale and retail (83%), and travel support services companies such as car hire ventures and travel agencies (81%).
“Besides that, 56% of survey participants are currently operating under reduced capacity, and 23% have reported having to shut down.
“Reassuringly, 83% of businesses that have closed expect to open up again at some point. Only 4% of all companies we received feedback from will remain closed. Most of these companies operate in the beauty, hospitality, food and agriculture sector.”
“When it comes to Covid-19 fuelled retrenchments, accommodation and food services companies top the list.
“About 68% of respondents in these sectors have had to let all, most, or some of the employees go, followed by water, hair and beauty salons (62%), construction firms (61%) and entertainment, arts and recreation players (57%),” Naidoo explains.
Naidoo said a key finding was that employees’ value to their organisation no longer depends on them working from an office: over half (51%) of companies said they were dealing with the pandemic by having 20% or more of their staff working from home.
This particularly concerns the financial and professional services industries, real estate, and the media, information, communications, and technology sectors.
“Interestingly, 44% of these companies say this could become a permanent set-up.”
Naidoo said not all industries had that luxury, such as agriculture, construction, travel, and tourism.
“Only 30% of respondents falling into these categories said they had more than 20% of their staff working from home. They also suffered most retrenchments, revenue losses, and cash flow declines.”
He said to move beyond Covid-19, 36% of organisations were reworking their business strategies to overcome the implications of the pandemic.
“Others are working on enhancing their internal skills set.
“The assets organisations view as most critical to help recovery include enhanced customer services (64%), as well as improved financial (56%), marketing and sales (46%), people management (45%), and planning (44%),” said Naidoo.
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