Article provided by Lulalend
The nationwide COVID-19 lockdown has been a game-changer for the SMME sector in South Africa. With a range of restrictions imposed and the resulting financial constraints that this has caused, many small businesses have had to come up with creative solutions to maintain a steady income stream all while still being able to deliver services and products to customers.
While many SMMEs are focusing on their operations and taking stock of where they can optimise processes to save money, Trevor Gosling, Co-founder and CEO of Lulalend – an online SMME lender, says that it is important that business owners and managers also use this time to focus on what they can do to adapt the way that they do things to help them grow in 2021.
“With greater acceptance of online services, along with a shift of public and private sector spending, ensuring that businesses are ready for any changes that might be needed to meet these changing demands is critical,” Gosling adds.
“Regardless of how the lockdown has impacted businesses in 2020, it’s critical to begin preparing for 2021,” he explains. “While many restrictions are still in place, SMMEs should be using this time to plan for the future by evaluating what worked well and what didn’t. What needs to change in your business model, financials, and customer experience to be able to meet the changing needs of your customers?”
Not only is working capital important to effectively manage the day-to-day expenses of a business, Gosling says that strengthening current sources of financing enables a business to invest in and take advantage of any growth opportunities as they appear, as well as respond quickly to any future changes that impact their business.
Access to funding is often one of the biggest challenges that businesses face in South Africa, according to a recent study by Transunion.
Responding to the funding needs of SMMEs, Gosling says that Lulalend has increased the amount of funding it is able to offer to R2 million. “With half of all SMMEs telling us that access to funding is their main barrier to both survival and growth, and with the costs of running a business on the rise, it was clear to us we could better serve the nation’s entrepreneurs by offering larger amounts of capital.”