Small business, big plans: Taxi drivers must aspire to own the value chain

Johannesburg – Until Covid-19, small businesses have been flexing muscles.

Small businesses have, without much fanfare, slowly taken over more of the turnover pie.

In 2013, small business generated 16% of total turnover in the formal business sector, expanding to 22% in 2019.


The contribution of large business waned over the same period from 75% to 68%, according to Statistics South Africa.

Small businesses are now counting their loses, others are in liquidations and insolvencies, while many unregistered small businesses probably suffered mild to severe stroke or died natural deaths.

Many of the small businesses would not be able to make a comeback as they lived from hand to mouth.

To make matters worse, on January 11 President Cyril Ramaphosa extended South Africa’s adjusted level 3 lockdown with more tougher restrictions.

Surely we must heed the call by Ramaphosa to comply with all the regulations in order to flatten the curve given that more than 1.2-million cases have been reported in the country, with over 33 000 deaths recorded.

The numbers are scary and growing exponentially. But where does all of these regulations put black business?

The South African economy can no longer afford any more beatings. Amid the Covid-19 pandemic, blackowned businesses have been hit the hardest with no savings, no insurance and no contingency plans.

According to the Institute of Race Relations, only 10.5% of blacks are covered by private medical insurance, compared to 72.7% of whites. You may want to translate these numbers into insuring black businesses against the worst possible scenarios. What is to be done?

The elitist view would probably be quick to point out the need for education, but business principles are the same. Even a street vendor knows that they must preserve cash in order to stock up for the next day.

Small businesses generally have high vulnerability to shocks. Will the township businesses keep up with the fastpaced world of technology or even compete with your Takealots of this world? We need to start thinking big.

Broadband is a game changer.

Consumers are no longer interested in the shop around the corner in today’s competitive market.

Sometimes it is also counter-productive to lay out brilliant plans without first fixing the mindset and business acumen of small businesses.

There are barriers that are holding black business back, some are historical, others man-made. Business evolves, so should you.

Taxi drivers must aspire to own the value chain in their industry such as petrol stations, tyre manufacturing, panelbeating, insurance companies and cooperative banks.

At some point, they tried to own an airline, but it was a long short. But they tried.

Makhafola is a communication consultant.

Joe Makhafola is a communications consultant and a former spokesperson of the the communications department

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