Future Proofing your Business Using Digital Platforms and Cashflow Management Strategies

*Data and report from the Mastercard New Payment Index of 1000 South African Small - Medium Sized business.

Planning for the future is often a daunting task for many business owners because it involves looking at the current situation in great detail. If you run a seasonal business it is even more crucial to plan for the future in order to future-proof your business from possible low income or high volume months in the future.

There have been some serious challenges that have impacted small businesses during the last 2 years and many are still recovering if they haven’t closed down completely. The lengthy lockdown in South Africa and the slowdown in the economy has impacted SMEs significantly. There have been some interesting statistics around the impact of the pandemic on South Africa.

They are:

• 43% of South African small businesses had to close their doors during the pandemic and analysts are predicting the around 60% of SMEs might close their businesses indefinitely.

• 60% of permanent jobs were lost.

• 70% of SMEs have reduced their spending because they were closed for long periods, had to lay off employees, and work fewer hours.

There has also been a shift in consumer behaviour. The rise in online shopping has skyrocketed. There has been a reduction in cash and cheques compared to online payment methods.

How Can You as a Business Owner Take advantage of this new rise in digital shopping and e-commerce?

Though it has been a difficult time, this is an opportunity to pivot your operation into the digital sphere and start looking at new payment methods and digital ways of doing business with your customers.

Everyone has had to adapt the way they live, the way they work, and the way that they shop. If you look at how you shopped before the pandemic to now, it is very different. You think twice about where you need to go to shop and how quickly you can shop so that you can return to safety again. In a recent global study with 5500 major MasterCard merchants, they found that between Q1 of 2020 to Q1 of 2021 more than a fifth of the merchants globally had to increase the number of ways they connect with their customers.

Dispersive Consulting is an accounting, tax and advisory firm whose mission is to help business owners operate profitable businesses. Sound financial management and a good understanding of business finance empowers business owners to make smarter, more informed decisions about their businesses.