The ongoing drought and subsequent water shortages has become a top contender in what is keeping small business owners awake at night.
In a similar manner to the way in which load-shedding worried small and medium-sized enterprises (SMEs) up until 2015/16, and even 2017, the looming significance of water taps running dry is becoming more of a reality.
In the 2015 SME Survey, frequent and prolonged power failures ranked as the most concerning issue for SMEs, with 71% of respondents at the time registering distress over this external threat to their businesses on the back of the cumulative effects of ongoing load-shedding.
The latest SME Survey, released on Tuesday in partnership with Intuit QuickBooks, show that 29% of the 1 400 SMEs surveyed between November 2017 and February 2018 are concerned about the current water shortages – power failures featured as a concern for only 10% of SMEs.
This was exacerbated by the Western Cape’s Day Zero campaign, with concern surging from 8% in the first half of the survey to 44% as Day Zero neared with increased urgency, said principal researcher and World Wide Worx MD Arthur Goldstuck.
Describing the headline findings at the launch of the survey, he said this was more pronounced in the Western Cape – the heart of Day Zero – where 89% of the businesses registered concern.
The Day Zero deadline, however, has continuously been pushed back as water consumption decreases, with expectations that the day the taps will run dry will now no longer occur in 2018.
However, the survey shows that competition remains the most pressing external issue facing entrepreneurs, with 46% of those questioned worrying over rivals.
Meanwhile, the overlap of the pre-holiday season and post-holiday season during the survey period also enabled the survey to divide the results seasonally and measure expectations before and after the ANC elective conference in December.
The project reached the halfway mark of its targeted 1 400 interviews shortly before the break, providing a rare opportunity to compare pre- and post-holiday stresses.
This was prominent in the SMEs’ increased worry over crime prior to the holiday season than at the beginning of a new year.
Overall, 16% of SMEs worried about crime – 19% revealed concern in the first half of the survey and 14% upon the opening of the business year.
A similar trend had been seen in SMEs views of corruption, of which, overall, 11% said corruption kept owners and leaders awake at night, with 14% prior to December and 7% in the new year.
Other top external concerns include generating sales (13%) and computer problems (10%).
The survey also highlighted the internal challenges faced by SMEs, with cash flow a major concern for 39% of the SMEs surveyed, with 73% relying on their own capital.
However, the vast majority claimed to have a positive cash flow and expect to be profitable in 2018.
Some 34% were apprehensive about finding the right staff, 24% over meeting deadlines and 10% over marketing.
“Holidays weigh heavily on decision-makers at SMEs, as they rush to meet deadlines before the working world closes its offices for the festive season,” Goldstuck commented.
The importance of these issues faded somewhat post the holiday period.
The survey also found that potential of fraud, losing data and labour trouble with staff left company leaders uneasy.