South Africa

Even if they can afford a generator, small businesses hammered by power cuts

The electricity crisis in South Africa is weighing heavily on everyone – from individuals and families to employers and government itself.

One sector that's particularly hard hit by the ongoing power cuts is small business.

RELATED: 'We'd rather be putting all our capital into new stores than backup power!'

Bruce Whitfield interviews Mantelli's founder Simon Mantell (Mantelli's Biscuits) and other business owners about surviving amid relentless load shedding.

His sympathy lies especially with those small business owners who can't afford generators says Mantell.

But even if you can afford a 'genny', that then comes with huge running and maintenance costs.

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Mantell says that just in the last week they probably spent about R15 000 on diesel.

The generators we have in our factory… that's R800 000 installed. Then you look at maintenance… R30-35 000 a year, and they're on and off so there's a lot of maintenance… then there's transport for diesel..

Simon Mantell, Founder – Mantelli's

A big concern is also how down time (even when there is a generator it might still have to power up) affects productivity he says.

… then the big problem for businesses that can't afford generators, they're the ones that are really getting hammered… and many are business channels that can least afford disruption.

Simon Mantell, Founder – Mantelli's

Sakhumzi Maqubela, owner of Sakhumzi Restaurant in Soweto, says they wised up years ago and invested in a solar system.

This only partly solves the problem though.

The solar system can't give you enough power… We also opted to spend money on a generator… just to service it is over R10 000.

Sakhumzi Maqubela, Owner – Sakhumzi Restaurant

So the cost of doing business in this country has gone up, but not the income.

Sakhumzi Maqubela, Owner – Sakhumzi Restaurant

Daniel Levy, CEO of coffee chain vida e caffè, also highlights the role growing negative sentiment is playing and will play in the future of these businesses.

The economic effect on offices and on people affect those very customers that come to us… so while we can supply coffee and keep a lot of our doors open and coffee is kind of a necessity… we certainly look ahead and wonder what the effect on people's pockets will be in the longer term… and how that might treat us…

Darren Levy, CEO – vida e caffè

There is massive uncertainty and when you run a big chain you do like to plan forward as far as possible, and this situation doesn't allow you to do that.

Darren Levy, CEO – vida e caffè

Listen to the conversation with the business owners on The Money Show:

This article first appeared on CapeTalk : Even if they can afford a generator, small businesses hammered by power cuts

Artmotion S.Africa

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