Tag: cash flow management

In the aftermath of the virus outbreak, 2020 has certainly been a challenging year for the manufacturing sector. The World Bank predicts the pandemic will push Sub-Saharan Africa into its first recession in 25 years with growth predicted to fall to -3.3% for 2020. Reduced demand has taken its toll on the balance sheet and cash flow of most producers.

Running a business in what we assumed would be a post-COVID-19 world this year has turned out to be a continuous challenge, taking on various strains from last year’s pandemic. A common denominator for many small business owners is steady cashflow throughout the year.

South Africa is limp wristed from unclear definitions and objectives that are used at different moments to drive ambiguous agendas. South Africa lacks a clear definition for transformation, and thus every other organ of change abdicates their role in shaping the country in a progressive direction.

The role of the property manager continues to evolve. Once thought of as 'merely' rent collectors, it became all too evident that the role of a good property manager had progressed to encompass that of asset management. Now, with the effects of COVID-19 being keenly felt by businesses the world over, the role of the property manager has evolved once more to now include mediation as a key skill.

Despite a legal requirement that invoices and claims be paid within 30 days or within the period contractually agreed upon, a Public Service Commission (PSC) report has revealed that South African small, medium and micro enterprises (SMMEs) are owed billions in unpaid invoices by government departments.

The current COVID-19 pandemic, and the lockdown implemented by the South African government, has had a significantly negative impact on businesses. Some have only recently been able to commence operations with the start of the current alert level 1 status.

Amid the devastation caused by the COVID-19 pandemic on businesses, and in particular small businesses, bankruptcies have soared. If you were to do an analysis of why many small businesses go under, you are likely to find that a significant number end in financial ruin by making the same or similar mistakes.

It’s common cause that too many South Africans struggle with debt. National Credit Regulator data shows that 40% of the 25 million active credit users are behind on their payments. That proportion has probably become worse since April 2020 because the data was released before the COVID-19 crisis.

COVID-19 cannot take all the blame for the disruptions taking place in the global economy. The pandemic and resultant lockdown simply provided a conduit for highlighting the failings across industries in South Africa, whether that is healthcare, public transport, education, or others.

In March 2020, President Cyril Ramaphosa announced a 21-day ‘hard’ lockdown, later to be known as a level 5 lockdown. It certainly caused flutter in the financial markets, forcing almost the entire economy to cease operations and people to be confined to their places of residence.