Almost 90 percent of African small businesses fear they may not survive the Covid-19 crisis, and need access to practical tools and support to prevent financial loss, according to a recent survey of entrepreneurs by the African Management Institute (AMI).
Of entrepreneurs participating in AMI’s free COVID-19 Business Survival Bootcamps, 87% are worried about surviving the current crisis, while 67% of those surveyed said business had been hit hard since the introduction of social distancing, lockdowns, and curfews on the continent.
“Practical and applicable tools are essential during a crisis like this,” said Rebecca Harrison, CEO, and co-founder of AMI, which has shifted all programs online and is providing a range of practical tools online for entrepreneurs in addition to the Bootcamp.
“Our two-week virtual Survival Bootcamp provides free online access to downloadable tools to help business owners immediately navigate the crisis. These tools help businesses plan for different scenarios, assess risk in their businesses, and manage their cash-flow and costs.”
Almost 2,500 businesses from over 40 countries across Africa have registered for AMI’s Bootcamps, which introduce entrepreneurs to simple but critical tools to help them survive the crisis and rebound when it eases. Participants of the Bootcamp come from 44 countries but are concentrated in Kenya and Nigeria, followed by South Africa, Rwanda, Tanzania, Uganda, and Ghana.
“At the moment managing cash is very important because I don’t know how long this pandemic will last,” said Kenyan entrepreneur Mary Onyango of Afro Accessories and a Bootcamp participant. “This Bootcamp has helped me understand where to focus and how to set my business up to survive the crisis.”
In response to the survey, 62% of SME owners also said that COVID-19 had had a high-impact on customer demand, and 49% said their product supply had been highly impacted. In qualitative focus groups, businesses have indicated that they need help to forecast cash flow, plan for different scenarios, understand how to keep connected to and continue to support their customers, manage costs and determine how to support their team at this time.
It is also clear that Africa’s small businesses urgently need liquidity. More than 75% of entrepreneurs surveyed believe a loan would help their chances of survival, and just over 50% indicated that small loans of less than $50,000 could be the difference between survival and closing down.