Small businesses' December recovery reversed by Level 3 restrictions - Yoco

• Small businesses have been bearing the brunt of stricter lockdown regulations announced in December.
• While a decline in turnover is common in January owing to the seasonal decline in spending, January 2021 experienced an additional 10% decline over and above what is usually observed.
• Payment services provider Yoko announces its Small Business Recovery Monitor on Monday, indicating that some retailers' turnover had halved.

The return to Level 3 of the Covid-19 lockdown regulations has put harsh brakes on business recovery in many provinces. 

This was particularly evident in Gauteng, the North West and Limpopo, where the turnover of small businesses was almost half of what it was before regulations were reintroduced in late December last year.

Payment devices provider Yoco released its latest Small Business Recovery Monitor indicator for January 2021 on Monday, which showed that small business turnover throughout the country had fallen to 72% of its normal figures in the past month.

The recovery monitor is based on payments that customers of these small businesses make through the Yoco's payment devices.

"The impact of the move to Lockdown Level 3 can distinctly be seen in the immediate drop in turnover in the weeks after the presidential announcement on Monday, 28 December 2020. Prior to that, all industries, particularly retail, were in full swing, operating at over 100% comparatively," Yoco said.

As at 31 January, turnover for small businesses in Gauteng stood at 62% of what they normally generate, the second lowest in the country after the North West, which generated 55% of the usual amount. Throughout January, Gauteng moved between being the worst province to the second worst in terms of turnover generated by its small businesses.

Yoco added that the new restrictions took a toll on the Western Cape too as it struggled with an average turnover of around the 80% mark for much of the month – a direct impact of the Level 3 regulations, which included beach closures and alcohol bans.

KwaZulu-Natal is the only province where the turnover of small businesses was higher than before the lockdown.

Small businesses' turnover around the country was at more than 100% of pre-lockdown levels for most of December as small businesses increasingly started functioning normally again when the country moved into lockdown levels 1 and 2.

• READ | Cashless recovery for small businesses, Yoco data shows

The company said while a decline in turnover is a common occurrence in January because of the seasonal decline in spending, January 2021 saw an additional 10% decline.

Yoco added that its recovery monitor now indicates that daily turnover numbers are in the region of 80% to 100%, compared to pre-Covid-19 levels - dependent on industry and area.