WYLDE International has released its 2020 SME Performance Report with insights on the overall business health of growth-stage SMEs during Covid-19 period.The report, sought to establish the impact of COVID-19 among Kenyan SMEs, analyzing a cross-section of parameters, including Business finance scenarios and overall performance for the affected months - March vs April 2020, Funding vs Non-Funding Needs, staffing priorities and impact of Government Initiatives on SMEs.
The Kenyan SME Sector experienced a challenging first year quarter due to factors including locusts invasion and floods. Covid-19 agitated this grim economic outlook set out by partial and total national lockdowns and supply chain shutdown. "Hope prevails however with the 93 entrepreneurs interviewed via a customized mobile-based survey confirming that they will not shut down their businesses despite deficient government initiatives," the report states.
With regard to business finance scenarios, the report states that cash flow is the greatest problem facing the SMEs followed by disrupted sales. Consequently, 26% of SMEs predicted they will have a hard time in paying salaries due to dwindling profits. Additionally, 19 % expected revenue losses and while another 19 % of SMEs anticipated defaulting on their bank loans in the next six months.
When asked about Funding vs Non-Funding needs, majority SMEs (80%) confirmed that external funding which includes loans and grants is important in keeping businesses afloat during the Covid-19 period.
The top three non-funding needs identified were (23 %) review of business strategies including networking and focus on new ventures, (17%) targeting business development and management initiatives as well as (11%) pursuing tax relief and waivers.
It was encouraging to see that the majority of the employers were highly concerned for their employee health and safety (76%) , retention strategies (51%) as well as skill development (49%),” explained Sharon Mbugua, Research Director at Amethyst Consulting, Wylde International partners in conducting the survey.
According to the report, businesses seemed to be on a recovery mode in April with most SMEs performing better than March 2020. This could be attributed to SME’s embracing Government interventions in a bid to survive the economic slump.
VAT reduction was highlighted as the most useful Government initiative by a majority of SMEs (51%) followed by PAYE reduction (44%) while curfew was rated the least useful intervention (57%).
Having trained more than 4,000 entrepreneurs in 7 years, the WYLDE International team, led by Managing Director Joram Mwinamo, outlined the following recommendations for SMEs to adopt in order to stay afloat over the next six months.
Invest in short-term strategies for survival during COVID-19 period e.g.
Find ways to remain open for business while observing health protocols.
Take advantage of discounts, tax rebates and other stimulus packages offered by government, clients, suppliers
negotiate with landlords for rent rebates,
Look out for new opportunities by targeting sectors thriving despite and because of COVID-19,
serve existing clients with products and services they need during this COVID period,
increase delivery of products and services at the customer’s home.
Implement aggressive cost management that focuses on essential spending.
Deal with HR issues legally and with humanity.
Learn how to manage productivity remotely e.g. by motivating staff, checking in on them, sharing Work From Home (WFH) tips especially for those with children, etc.
Christopher Odongo Director of Entrepreneurship Wylde International invited entrepreneurs to sign up for the free ongoing virtual “Boost with Facebook” initiative designed to equip SMEs with digital skills to market and grow their businesses online.
“Based on the SME Performance Report findings, entrepreneurs interested in upskilling their teams on how to use Facebook, Instagram, and WhatsApp, will be able to leverage these digital tools to stay visible and top of mind with existing clients, allowing them to build resilience during this period,” explained Odongo.
All SMEs are invited to register here bit.ly/BOOSTKENYA
Download the whole report below:
For more information on the report or how you can work with WYLDE contact;
Christopher Odongo
Director Entrepreneurship
WYLDE International Ltd
SNDBX, CMS Africa House
Ground Floor
Tel +254 715 723342
chris@wyldeinternational.com