“We have to be very creative and above all flexible to adapt to these tough times.” – Chantal Fourie (Owner of Nevernew)
These were the words that opened the dialogue I was to have with Chantal Fourie, owner of Nevernew, on her business. She was not talking exclusively about businesses, but to all of us in these uncertain times we face.
It is no secret that economics and economic development has been part of the discussion when addressing the Coronavirus (COVID-19). COVID-19 is a family of viruses that can cause a common cold or more severe diseases. Nevernew is a local business, and I reached out to them because I had heard repeated, over and over again, how small businesses would suffer the most in the upcoming months. The US signed off on a $2 trillion stimulus bill that small business can apply to in order to get a loan (read more about that in US News). Additionally, in South Africa, the Oppenheimer’s South African Future Trust provided R1 billion to small, medium and micro enterprises (SMMEs) (information from Business Tech). This is evidence of the focus on smaller businesses.
South Africa has not been under lockdown for a long period of time in the greater scheme of things, and it is uncertain if this will be the end. So, it is too early to see the full effects of coronavirus on SMMEs. According to a FNB statement to CNBC Africa, the reason for SMMEs being the most vulnerable during this time is that, “they often have limited access to funding, whether in the form of bank credit or alternative sources. In times of an economic down-turn or crisis, these businesses are some of the most vulnerable as they generally have less access to liquidity to weather the storm than larger businesses.”
However, some micro-businesses live week-to-week as opposed to month-to-month and had felt, and still do feel, the effects of the lockdown when it happened. The SMMEs Forum, through the Sunday Independent, have voiced their concerns on financial aid. Some of these concerns are the lack of accessibility to funds and fear of not being protected financially as South African citizens. This highlights the place we find ourselves in South Africa, some people’s businesses are occupying roles as street vendors. These are the extremely vulnerable who are unable to continue business. These are the people who cannot access funds because of their status as informal workers. These are the people who will fall through the cracks even with potential aid.
It was my curiosity to talk to someone who owned a business and find out more about how lockdown was being handled on a microscopic level, which brings us back to Nevernew. Founded in 2014, Nevernew would be familiar to students who get off the Observatory or Health Sciences Jammie to stroll down the Observatory second-hand lane. Located next to the McDonalds, it sells vintage as well as local festival wear and accessories. The store is crammed full of exciting hidden treasures. Fourie describes the store as “colourful, vibey and electric.” Founded on a passion that existed since her teenage years, Fourie describes second-hand clothing buying as part of a “lifestyle” that promotes environmental sustainability.
It seems lockdown was not unexpected for small businesses, as Nevernew started preparing to shutdown before the President’s second address. They even closed a day earlier than stipulated by the president. Closing down the store has caused Fourie to miss ” the interaction with diverse clientele, hunting for vintage gems and planning for new stock lines.” COVID-19 has clearly had a complete shut-down effect on small clothing businesses, because there is no way to do work from home.
Fortunately, Nevernew is safe, save for the obvious loss caused by missing business for a month, as the business is not run week-to-week. Nevernew has full-time employees and three part-time staff members, who remain employed at Nevernew. They continue to earn during lockdown. Fourie foresees creativity playing a part in making up the loss caused by lockdown – perhaps in extending into online sales. She expects the effects of COVID-19 to have long-lasting effects into the next several months.
Finally, to other small businesses out there, she encourages them to keep things low-risk. Fourie explained: “Don’t over-invest in stock and look for ways to cut business expenditures where possible. Always have reserve funds for a crisis and remain consistent with your clientele service.”
Fourie was right when she said that we must be flexible through what is to come. Globally, we are facing an unprecedented problem. As much as I would love to race my hand along the fabrics on the racks of Nevernew, I am afraid that may be a while away. Small businesses are facing problems that may result in them closing their doors. This event will change the way businesses run and the procedures in place for potential crises.