Ramaphosa on large vs small companies in South Africa, and how entrepreneurs are finding success in Covid-19

President Cyril Ramaphosa has praised the ingenuity of young entrepreneurs as South Africa battles the spread of the coronavirus which has brought about fundamental changes to the business landscape.

“The coronavirus is a dark cloud that is hanging over the lives of South Africans and the economic fortunes of our country,” the president said in his weekly letter to the country.

“As much as Covid-19 hangs over our country, there is a silver lining to this dark cloud. As much as we have to face enormous difficulties and challenges, such as rising unemployment and poverty, there are a number of opportunities that we need to look out for to undo the harsh consequences of coronavirus.

“There are a number of South Africans who are searching for the silver lining,” he said.

Ramaphosa highlighted the combination of foresight, creativity and business acumen displayed by a number of young South Africans, who he said are coming up with home-grown solutions to the contemporary challenges the country faces.

“Some have started small business ventures because of personal circumstances, like losing their jobs,” he said. “Others who were previously unemployed have seized the opportunity provided by the pandemic to create their own income.”

The president handpicked several cases of entrepreneurship, where people have used the pandemic to start a business.

Cloudy deliveries

Cloudy Deliveries in Langa, Cape Town was formed by a group of youth who run a bicycle delivery service ferrying goods from the shops to the homes of residents in the township.

“During the lockdown, they have focused their operations on doing shopping for the elderly who have been encouraged to remain at home. They earn an income and at the same time provide a much-needed service to the community,” said Ramaphosa.

Rabbit’s pizza

Ramaphosa also highlighted electrician Xitsakiso Baloyi from Mankweng in Limpopo, whose pizza-making hobby turned into a fully-fledged business after his family started posting pictures of his creations on social media.

With the lockdown preventing people from eating out, Baloyi received an avalanche of queries from community members asking if he was selling his pizzas, Ramaphosa said.

“Now his business, Rabbit’s Pizza, started with his savings of just R1,000 and the baking pans in his kitchen, employs nine other young people and delivers not just in Mankweng but also in nearby Nwamitwa and Giyani,” said Ramaphosa.

“He says he plans to open new outlets in other rural communities in the near future, and to employ more young people in his area who are without work.”

Ponani Shikweni 

Ponani Shikweni from Alexandra township in Gauteng has repurposed her linen manufacturing business to produce face masks, the president said.

She now employs 35 people, most of whom are under 25. She produces more than 1,000 masks a day to order. Her business has already distributed over 20,000 cloth masks for free to residents of Alexandra, he said.

Judy Jay

To keep the nation’s spirits up during the lockdown, young artists and musicians have taken their talents online, resulting in new business opportunities, the president said. One such artist is 18-year-old Judy Jay, a DJ and rising star from Sekhukhune.

“Her watch parties during the lockdown have attracted the attention of major local and international radio stations, enabling her to promote and grow her brand.

“The creative and enterprising spirit of these and many more young people that has been brought to the fore during the pandemic must be harnessed and supported,” said president Ramaphosa.

Large vs small companies in South Africa

“Even in our darkest hour, we must look to these green shoots of renewal. They are the silver lining to the dark Covid-19 cloud. Our economic recovery cannot wait until the coronavirus pandemic is over. It needs to start now,” said Ramaphosa.

“One of the defining developments during the lockdown was how businesses in the townships and rural areas came into their own as people were not able to travel around much.

“In more ways than one, small and medium enterprises in the townships and rural areas have been able to keep our people supplied with the daily necessities. This demonstrates the resilience of small and medium enterprises during a period of great distress in our country. The capacity and ability of these SMMEs shot to the fore.”

To enable these businesses to thrive we must tackle the barriers to entrepreneurship, the president said.

He said that the concentration of markets and capital in large firms limits the potential of small businesses. “Then there is spatial inequality, which concentrates poverty in particular parts of our cities, towns and villages.”

He said that entrepreneurs in these areas find it difficult to raise the funds to launch and grow businesses, and are often far away from the markets where they can sell their products.

“It is not enough simply to urge individuals to take advantage of opportunities or to encourage an entrepreneurial spirit among our youth. We need instead to deliberately build township and rural economies.”

“Small businesses present the greatest growth opportunity for our economy and are a major source of job creation,” he said.

“In such challenging times, when many have lost their jobs and the unemployed have found it even harder to eke out an existence, we must act with renewed urgency to support these businesses.”

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