South Africa has been experiencing rolling blackouts since October. Picture: Karen Sandison
South Africa has been experiencing rolling blackouts since October. Picture: Karen Sandison

Small businesses bear the brunt of load shedding

By Manyane Manyane Time of article published Nov 19, 2021

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South Africa has been experiencing rolling blackouts since October. Picture: Karen Sandison

Load shedding has added more financial strain to township businesses that are already affected by the Covid-19 lockdown regulations.

Small businesses can’t afford backup power sources like generators. Picture: Ian Landsberg

South Africa has been experiencing rolling blackouts since October 23 with a break on November 1 when the country went to the polls for municipal elections.

This has seen business associations such as Black Business Council calling for the Eskom chief executive Andre de Ruyter and all senior executives after the ailing state-owned entity announced another round of stage 4 load shedding on Monday.

Paul Ngwane, owner of Meat Galore, a chesa nyama in Evaton, said the power crisis has added more financial strain to his business that was already affected by Covid-19.

“You see how quiet this place is. People have no money. Already people lost jobs due to Covid-19, and others had to take salary cuts. This affected us (the businesses) because people are broke. They can’t afford to spoil themselves any more,” he said.

He said he was considering closing the place or selling it to anyone who will infuse life into it.

“There was a time people would come in numbers to braai and have lunch and supper here. That was before Covid-19. Now I can take a day with only two customers. I used to make between R3 000 and R2 000 a day but now I make between R300 and R200 or less. Already we are struggling and load shedding is making it worse.”

We are a small business and we don’t have generators. This means we have to buy fresh stock now and then, which is a huge loss. I have been thinking of closing or selling to someone who can come up with new ideas to revive this business. Maybe someone who will add drinks and anything that will entertain people. For now, the business is not surviving,” said Ngwane.

Anita’s Salon owner Khosi Mabasa said she had lost experienced staff due to salary cuts.

“I had to implement the salary cuts because of Covid-19 last year. And ever since, we have been struggling, and we couldn’t use our normal operation time because of load shedding. This has affected us badly. Some of my employees were recruited somewhere and others went on to open their businesses,” said the 38-year-old.

She added: “Now I am even struggling to pay school fees for my children. I mean, I am no longer used to making money like before. Despite all this, I still have two of my employees,” said Mabasa.

France Nyambi, the founder and CEO of Maposha Holdings, which helps people with logos and branding, company registration, business cards etc, also said load shedding has added strain to his company that was already affected by Covid-19.

“The initial stage of Covid-19 affected us as well since most clients had to cancel some of the production we had to do for them, cutting out budgets and cancellation of other plans they had. Then load shedding added to our problems since we only get paid based on the amount of products we produced,” he said.

Nyambi continues: “Load shedding costs our business a lot. We normally work on deadlines - an hour or two without electricity affects our productivity and leads to delays on the expected time of delivery to our clients.

“So it affects our revenue drastically because some clients tend to take their business to bigger companies that might have power backup to continue working during load shedding,” he added.

Evoke Nail & Beauty Salon owner Gift Khoarai echoed the sentiments saying load shedding had a negative impact on the business.

“Here we deal with appointments and targets. Imagine what happens when clients arrive and there is no electricity. And some of them travel from Palm Springs as far as Sebokeng for a hairdo. We now have to work fewer hours and it is not good for us. Sometimes we have to tell our staff to go back home and this is not good because they don’t receive their full salaries. Last year we had to reduce our staff to three employees.”

“We are losing profit. Before all this I used to make R500 or more and now I make R250 or less. Our clients are always in a hurry. They can’t wait for two hours.”

Kingstone Murinye, the founder of Helbon Bakeries, said load shedding has affected his production.

“For example, it goes while I’m in the middle of baking which affects bread giving losses for flour. And also I'm losing customers because most of the time I don’t have enough bread to supply them and my daily production has decreased by 40% as compared to before load shedding.”

He said he used to produce more than 1 000 loaves of bread a day and now he only produces 600, which is a huge blow to the revenue.

“Automatically if there is low production there is low salaries and wages, especially those working on commission in production have been affected so much because their daily target to earn more commission has been reduced. If load shedding continues, we close up the company because we cannot continue operating at a loss, or we cut the staff down to the size of production we are having,” said Murinye.

Business Unity SA (BUSA) chief executive Cas Coovadia said load shedding had a disastrous impact on small businesses.

“They don’t have resources for alternative energy such as generators and they don’t have cash flow to manage goods getting spoilt and managing other costs related to load shedding,” he said.

Coovadia added that load shedding was also devastating for the economy, estimating that the economy could have lost about R25 billion in the last three weeks.

“This is on the back of the economy not growing anyway and already being battered by Covid. We have called on the government, as Eskom shareholders, to be transparent about how they see Eskom addressing this crisis in the immediate term, as well as more systematically in the medium to long term.

“Eskom must be totally transparent about the cause of the problems and be open to utilising all available expertise in the country to assist them to deal with the crisis,” he said, adding that this could result in a jobs bloodbath.

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