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The impact of load shedding on South Africa’s small businesses

Load shedding is tough on everyone, but just how badly does it impact our small businesses? We recently spoke to 200 accountants and 400 small business owners to better understand how both load shedding and poor internet connectivity are impacting tech adoption and business growth.

Our third annual State of Small Business report, conducted in partnership with World Wide Worx (WWW), shows that over half (53%) of South Africa’s small businesses haven’t adopted cloud technology yet, because they can’t rely on their electricity supply and internet connectivity to support it. In fact, over half (59%) said that scheduled power outages by the national supplier posed a significant challenge for their businesses.

When it came to questions about internet connectivity, more than two fifths (43%) of respondents said that their internet connection was ‘OK but not 100% reliable’. This is a tough reality to work in as businesses need power to adopt new, relevant technologies and to keep things moving forward.

This latest State of Small Business report gives a real insight into what it’s like on the ground for small businesses in South Africa. In uncertain times like these, technology can provide much-needed stability.

Moving to the cloud

Notwithstanding the connectivity challenges they face, those businesses that have adopted technology are seeing the benefits – specifically, a large increase in profit (98%) and an increase in efficiency (99%).

As a result, new tech adoption is happening: a quarter (25%) have implemented Internet of Things (IoT) technology, followed by cloud computing (19%).

But there will be a learning curve for anyone using new software and employees shouldn’t be expected to self-teach. Almost half (47%) of respondents, described their employees as ‘very savvy’. Which is why it surprised us to note that 67% have not allocated any budget for employee tech training. Given the distinction between social and work tech, as well as the rapidly changing face of tech, small business owners can’t expect their employees to instinctively understand how to use specific business technologies.

Training aside, a strong IT support team and tech infrastructure is an essential component of any business. Nearly two fifths (38%) said their IT set up is competitive and over half (56%) make use of basic automation in operational and/or accounting tasks.

Future growth

The good news though, is that South Africa’s small business owners and accountants are becoming more tech savvy. Over the years, we’ve tracked an increase in new tech adoption and use – as well as noted the business benefits as a result. However, SA’s small businesses still face some big challenges holding them back from embracing technologies that could transform their businesses.

The best way forward is for small business owners to adopt relevant and available technologies, train their staff and get the most out of both their people and their software. By unlocking this potential, they’ll have more time and support to boost business growth.

If you’d like to read the full report, you can download it here.