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03 August 2021 | Story Prof Brownhilder Neneh | Photo Supplied
Prof Brownhilder Neneh is an Associate Professor and Academic Head (HOD) of the Department of Business Management, University of the Free State.

Opinion article by Prof Brownhilder Neneh, Associate Professor and Academic Head (HOD) of the Department of Business Management, University of the Free State.


South Africa was recently rocked by the worst violence, riots, and chaos that has devastated the business community. An estimated 40 000 businesses were affected, costing the country about R50 billion in lost output and endangering around 150 000 jobs. It is important to stress that the situation regarding riots and looting in South Africa is not a once-off phenomenon, because in the past few years, South Africa has witnessed rioting and looting as one of the reoccurring events happening in the country, which often left big and small businesses to bear the burden as they pay the price for the actions of angry citizens. The aftermath of the Zuma imprisonment has once again put immense pressure on small and big businesses that were already disproportionately struggling with decreasing revenue and dismal forecasts of earnings due to the continuing COVID-19 pandemic and lockdowns. The losses have had a devastating effect on particularly small businesses, which are typically not insured against damage during protests, and do not have much cash reserves at their disposal. Some small business owners’ years of hard work and entire life savings were completely wiped out overnight, putting the reopening plans of some on hold and completely shutting down others. 

Given that riots and protests are not unusual in South Africa, some people on social media have argued that South Africa is a volatile country when it comes to riots and protests, and that small businesses should have anticipated such risks and should have made an effort to obtain business insurance. A critical question to ask is whether all small businesses can afford insurance? In most cases we expect the answer to be ‘no’. This is because small businesses operate under various difficult circumstances, such as liabilities of newness, smallness, poorness, and lack of access to external financing. Nonetheless, it is important to educate small businesses about the importance of getting insurance, especially any form of insurance that covers their core assets.  But more importantly, what needs more insight within the South African context, is a critical discussion on how small businesses can minimise losses incurred during riots and bounce back from external shocks.

Many uninsured small businesses might not reopen unless government helps them

Depending on the extent of the damage across the different businesses affected during the recent protests, it could take up to 18 months to reconstruct the malls and for businesses to become fully operational again. This means that many of the small businesses might have to temporarily change their business location or relocate completely. The major problem with this strategy is the risk of paying double rent, both to the damaged mall as well as at the new location. The law does not provide for these SMEs to stop paying rent to the damaged mall, regardless of whether they want to relocate.  In addition, most of the assets that these businesses had, such as furniture, equipment, inventory, and debtors, were destroyed. This is a double negative, which implies that they have lost almost all of the assets they could use as collateral to obtain loans from financial institutions, as well as having to replace these assets.

Many of these small businesses that were not insured and have very little or no cash reserves may not be able to reopen their businesses, unless they receive assistance from the government. The South Africa government and the entire civil society have come out to condemn these barbaric actions, and have put in place some measures to redress the situation and bring stability to the country. As part of the recovery strategies, the government funds allocated to small businesses through its different departments, such as provincial development corporations, the IDC, and national youth funds, should be used to provide interest-free loans to those small businesses that were profitable before the looting crisis. Government should also consider paying business rentals to the damaged malls until these malls reopen.  Tax incentives for some of these businesses for a certain period of time is another option to be explored. Likewise, unemployment funds should be made available to pay their employees until they are fully operational again.

Within the context of entrepreneurship, resilience – which is viewed as the capacity of the business to recover, survive, or grow quickly following a crisis – is one of the capabilities that small businesses can deploy. While small businesses are often regarded as less resilient because of their limited resources, this liability makes them more flexible and adaptable in the face of adversity. Small businesses can become more resilient and less vulnerable to crises by developing an anticipated and containment mindset. An anticipated mindset entails continuous identification of all possible problems and emergencies, while a containment mindset is about embracing flexibility and adapting when responding to crises (conceptual slack), developing capabilities to deal with losses, and making a commitment to resilience. Small businesses can achieve these mindsets by undertaking training in metacognitive awareness, which entails developing coping strategies to respond to uncertain events, developing adaptive thinking to identify and recognise opportunities in an uncertain and dynamic context, and changing responses and strategies according to changes in the environment. Small businesses can also develop resilience by investing in and building resources. These resources can range from social resources (e.g., support from networks of family and friends, business partners); economic resources (e.g., personal savings, stokvels, and financial institutions); and personal resources (e.g., self-determination, inner strength, adopting a problem-solving mentality, emotion regulation, and self-confidence). As a short- to medium-term strategy, the South African government – through its Ministry of Small Business Development – should partner with higher education institutions and private organisations to create nationwide workshops and seminars on how to develop resilience and overcome liabilities of newness, smallness, and poorness.

Small businesses are the panacea for addressing poverty, unemployment, and inequality

Small businesses should also foster cooperative relationships, as these have proven to help entrepreneurs overcome the lack of resources by sharing business resources (equipment, business space, and funds). This ultimately transforms competitive differences into potential growth opportunities for businesses. This is one of the most important business practices adopted by many immigrant businesses for survival. Those who need to start from scratch are encouraged to develop their businesses, using what they can create with the set of resources (computer, land, skills, money, car) at their disposal, no matter how small. Given that the future is unpredictable, instead of defining a specific plan to reach a goal/objective, such entrepreneurs should focus on what means are available to them now. Most successful entrepreneurs around the world – and particularly in Africa, where entrepreneurs are usually constrained by limited resources and support structures – will tell you that they started their businesses with very limited or only one resource that they had at their disposal. It might be quite difficult and painful to undergo the cycle again, so entrepreneurs should tap into their inner grit and remember that although they are starting from scratch, this time around they are wiser and more experienced, which will ultimately translate to higher achievements. 

In conclusion, small businesses are the panacea for unleashing and addressing the triple problem of poverty, unemployment, and inequality that South Africa is currently facing. So, if the government is intentional about enhancing the creation, survival, and sustainability of small businesses, it becomes critical that they create an enabling environment that significantly minimises external shocks. The South Africa government should also put in place clear short- and long-term goals to address the causes and issues that give rise to riots and provide practical solutions to transform the country. The South Africa government should also partner with civil society and the media to spread awareness about the negative impact of destructions during riots and protests.

News Archive

Dr Makutoane to present research on world stage in US
2017-06-14

“If the SBL has acknowledged you,
it means the research you are doing
is solid. There are people out there
who want to listen to my paper.”

To present a research paper at an international conference of about 10 000 people and where 100 sessions are taking place at the same time is what dreams are made of for an academic. This is no longer a dream for the humble Dr Tshokolo Makutoane who will share his knowledge at the annual meeting of the prestigious Society of Biblical Literature (SBL).

Dr Makutoane, a senior lecturer at the Department of Hebrew at the University of the Free State (UFS), will be a speaker at the conference in Boston, in the US, from 19-21 November 2017. This after receiving a remarkable travel grant from the SBL to present his paper, titled The Contribution of Linguistic Typology for the Study of Biblical Hebrew in Africa: The Case of Sesotho Pronouns.

Description: Dr Makutoane to present research on world stage in US Tags: Dr Makutoane to present research on world stage in US

Dr Makutoane, senior lecturer at the Department of
Hebrew at the University of the Free State, was
speechless when he heard he will be presenting a
paper at the annual meeting of the Society of Biblical
Literature in Boston in the US.
Photo: Jóhann Thormählen

Scholars from around the world participate
His paper is part of a thematic session on “Theoretical Approaches to Anaphora and Pronouns in Biblical Hebrew” in which scholars from Canada, the US, Australia, Europe and Israel will participate.

The research Dr Makutoane will be showcasing in Boston is about teaching Biblical Hebrew in Africa, and more specifically, pronouns, to Sesotho-speaking students.

“SBL is one of the largest organisations in the world and if you get the opportunity to present a paper there, it is one of the highest honours in our context you can have,” Dr Makutoane said.

“If the SBL has acknowledged you, it means the research you are doing is solid. There are people out there who want to listen to my paper.”

According to the SBL website (https://www.sbl-site.org) more than 1 200 academic sessions and workshops will take place at the conference, co-hosted by the SBL and the American Academy of Religion.

Highlight of researcher’s entire career
Receiving the grant and attending the conference for the first time is the highlight of Dr Makutoane’s career. “I feel very grateful, honoured and humbled. I was speechless when I heard about it. I couldn’t help myself and actually cried,” he said.

The grant, given to only four SBL members – the other three are from Samoa, Nigeria and India – is intended to support under-represented and under-resourced scholars who demonstrate a financial need.

Dr Makutoane thanked his mentors, Prof Jacobus Naudé and Prof Cynthia Miller-Naudé, who assisted him with the application. Naudé is a senior professor at the Department of Hebrew and Miller-Naudé a senior professor and head of the department.

Dr Makutoane, who studied Theology at the UFS and is a minister at the NGKA Rehauhetswe church near Bloemfontein, is also grateful to his church that gave him the opportunity to study at the UFS and be able to work at the university.

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