(4 minutes read)
· More than half of small and medium-sized enterprises (SMEs) in Kenya expect their business conditions would take a turn for the worse in the next six months, according to a new survey, which adds to the rising pessimism among companies amidst increases in cases Covid-19 cases
· A majority of respondents, close to 68 per cent said they performed poorly in April in comparison with March
· In April, Kenya imposed a curfew, closed schools, bars and restaurants in a bid to stop the spread of Covid-19
More than half of small and medium-sized enterprises (SMEs) in Kenya expect their business conditions would take a turn for the worse in the next six months, according to a new survey, which adds to the rising pessimism among companies amidst increases in cases Covid-19 cases.
The survey was conducted by three research firms – SNDBX village, Wylde International and Amethyst Consulting. The survey findings bring to the fore that 54 per cent of SMEs expect continued decline in business prospects, which may get aggravated in terms of reduced cash flow and declining sales.
A majority of respondents, close to 68 per cent said they performed poorly in April in comparison with March. In April, Kenya imposed a curfew, closed schools, bars and restaurants in a bid to stop the spread of Covid-19. Some of the surveyed SME businesses said that they were struggling to pay employees and expect higher probability of business losses in the months to come. They were skeptical about meeting their loan commitments, reveals the survey.
However, 18 percent of the SMEs expect a positive change in their business finances. Close to eight per cent of the respondents are of the opinion that the situation would remain the same. The survey was carried out on a sample of 93 SMEs. The respondents were mostly from the consultancy services sector, financial services, hospitality, tourism and manufacturing.
Importantly, a majority of the respondents (78%) feels that they would not engage in any business development activities in the next three to six months. Another survey undertaken by the Central Bank of Kenya in May had revealed that 75 percent of Kenya’s SMEs face collapse if they fail to get fresh funds from banks or equity partners.
