Thursday, April 25, 2024

Surging inflation threatens SME survival 

Oaitse Kgosimore who operates a fast food business in the close proximity of University of Botswana lamented that although his meal prices have not changed, he will soon be left with no choice but to follow the world trend.

He added that it has been difficult for him to review his prices as his business is mostly supported by tertiary students.

“In the last 18 months I have been hoping that government will come up with better measures to improve our business environment but things have gotten worse. I have seen some of my competitors shut down their establishments. My establishment is dominated by student prices and now when I think of reviewing the prices I wonder whether my business will survive because students have not had any allowance increase since the start of COVID-19,” said Kgosimore.

Another small medium enterprise operator Keamogetse Segotso said customer buying has gone down as most people now prefer to buy food from shopping centres and eat at home in order to save money.

“I have lost a good number of customers since last year and this has forced me to reduce my profit margins because I cannot afford to cook food and return with them home. Every commodity we use here has gone up, you talk about cooking oil, wheat and cooking gas, I am now operating on small profit margins,” added Segotso.

Segotso also highlighted that as a result of high commodity prices, she has been forced cut down on some of the stuff she used to sell to her customers.

She stated that early this year she was forced to get rid of her two helping personnel as she could not afford to pay them.

“I am now operating on my own but I sometimes have a pair of hands to assist me especially during weekends but not necessarily meaning that I can now afford to retain staff,” added Segotso.

She further said another contributing factor to the low performing business is that some of the large retail outlets have started selling some of the things that were predominantly sold by small businesses.

On the other hand, Tshepo Seikantswe said his vegetable business took a hit due to the unavailability of some vegetable commodities locally.

Seikantswe stated that the place he sources his vegetable produce informed him of the price increase something which further threatens his business.

“I have been trying to stay strong in this business but the way things are getting expensive by the day I wonder whether I will stay afloat,” said Seikantswe.

He also said the transportation cost has also gone up and making it difficult to have all the commodities in stock.

The increasing commodity prices come at a time when many businesses are still trying to rediscover themselves following a problematical 18 months of state of emergency.

To top off it, the Russia-Ukraine tensions have also brought about uncertainty in the food sector as prices of wheat, maize, instant porridge, chobe special maize meal, pasta, bread and confectionary will go up next month.


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