Tag: businesses

Over 600 companies have closed this year

By Sarah Evans for Business Insider SA

Over 600 companies were liquidated in the first quarter of 2021 – a sharp increase from the first quarter of 2020 – following the first year of the Covid-19 pandemic. But while that number may seem steep, it’s not clear that the number can be attributed to lockdown, or even the broader pandemic, alone. It is not out of sync with liquidation trends seen over the last five years. In fact, the only evidence of the impact of lockdown in the liquidation numbers can be seen in the latter half of 2020, where liquidations increased.

The latest liquidation statistics were released by Statistics South Africa (StatsSA) this week.

With the exception of the month of April 2020, when the Companies and Intellectual Properties Commission (CIPC), which processes liquidations, was closed, liquidations appear not to have increased or decreased dramatically despite the lockdown.

In 2019, there were a total of 636 liquidations in the first quarter of the year, January to April, both voluntary and compulsory. For the same period in 2021, there were 674 liquidations. In 2020, the number dropped to 434 – but this includes the month of April, where it was zero.

In the first quarter of 2018, there were 578 liquidations, while the number in 2017 was 575. In other words, liquidations in the first quarter of the year have steadily increased over time, though not significantly.

Every year, the finance, insurance, real estate, and business services sectors had the most liquidations, followed by trade, catering, and accommodation. In 2016, StatsSA introduced a new category, “unclassified”. A high number of liquidations fall into this category every year.

Large employers like mining, manufacturing, and construction do not suffer as many closures as trade and finance, historically. However, 12 manufacturing firms went into voluntary liquidation in the first quarter of 2021. Seven construction firms were also liquidated.

Away from the broader trends, the impact of lockdown on businesses can be seen in some of the data: the 2020 data shows a spike in liquidations between August and November 2020. This could indicate a delayed increase in business closures due to the hard lockdown starting in March. It is also a trend not seen in the years prior.

According to a recent Business Tech article, businesses are often unaware that by giving a third-party or software programmes access to their financial information, they are potentially being exposed to the risk of screen scraping. This is a data gathering technique that tricks users into providing internet banking login details to a third-party website.

  • The third-party logs onto to your Internet banking using your details. This exposes you to potential risks of fraud, financial crime and data privacy risks
  • There are risks associated with instant online EFT (electronic fund transaction) payments
  • There are risks for businesses that sign over authority to a third party to access their banking and client information
  • The most common screen scraping from a business perspective would be when businesses use software that are authorised to access banking transactions.
  • This may also leave your business vulnerable to third parties accessing your company data and even that of your clients.
  • Companies that use screen scraping to facilitate transactions on your behalf may have no intention of compromising your account or committing fraud, but the risk remains.

FNB: how to protect your company data

  • Be vigilant when it comes to reading through any terms and conditions on any software or website before you click “accept”.
  • Make use of an application security testing tool before you sign any agreements authorising access to your company data.
  • Cloud-based software is not without its own risks. Insist on having both testing and sandbox environments, providing analysis for security gaps.
  • Find out from your third-party software vendors if they use open-source tools in their product. How they deal with open source can be a high risk if not done properly.
  • Do not share login credentials with any third parties and never enter these into any third party websites other than their own bank’s legitimate platforms.

Source: NEASA

On 1 October 2020, the Department of Employment and Labour quietly published new consolidated Covid-19 regulations to which workplaces must adhere.

Although much of the previous regulations have been retained, there are a number of significant amendments which places a massive additional administrative burden on already-overstretched employers.

The new amendments are as follows:

  • Employers with more than 50 employees must submit a record of its risk assessment, as well as its policy regarding the protection of workers from Covid-19 to its Health and Safety Committee and to the Department of Employment and Labour, within 21 days from 1 October.
  • These documents must be sent to the Chief Provincial Inspector. This requirement was previously reserved for employers with more than 500 employees
  • Employers with more than 50 employees must submit data to the National Institute for Occupational Health in respect of prescribed categories of data
  • This data must be provided once in respect of each employees’ vulnerability status for serious outcomes of a Covid-19 infection and weekly, before Tuesday, in respect of data pertaining to infected or high-risk employees for the previous week
  • The 14 day isolation period for Covid-19 positive employees has now officially been reduced to 10 days, providing that the employee wears a surgical mask for 21 days from date of diagnosis, the employers closely monitors his/her symptoms and that personal hygiene in respect of masks, social distancing and cough etiquette is strictly adhered to
  • In the instance of a high-risk exposure, employees so exposed must remain in quarantine for 10 days and be placed on sick leave in terms of the BCEA or, if sick leave has been exhausted, apply for an illness benefit
  • Dispute resolution procedures in respect of employees who refuse to work due to a serious risk of Covid-19 exposure have been introduced

You can view the complete regulations here.

By Derek Cikes for VentureBurn

Defying the odds to remain in business during the Covid-19 crisis is no mean feat. However, some businesses across South Africa are showing tenacity and innovation in the face of the country’s lockdown.

Covid-19 has forced digital transformation to the top of the agenda, with companies pivoting their business model to provide service offerings that are compatible to Covid-19 lifestyle changes.

Here below are some interesting examples of how SA businesses have pivoted in response to the current lockdown, providing insights into actionable steps to restructure and transform their business offerings to radically transformed conditions.

Digital disruption
At face value it would seem like the opportunity is currently lost for many retailers whose business deals directly with consumers. However, bathroom company, Bella Bathrooms and Tiles, has used digital transformation to pivot their business and change the entire landscape of their business’s operating model.

While pivoting comes with risk, inaction can pose a far greater threat to a business’s survival during the current times

The bathroom company is providing an innovative décor service allowing homeowners to download the Bella Bathrooms décor app which accesses the person’s smartphone camera (with the relevant permissions of course).

In this way, homeowners can enjoy a virtual consultation from the safety of their own homes with their bathroom designer.

If you believe your sales and consultations can only be done face-to-face, it might be time to re-evaluate your entire sales process and transform it.

This “new normal” demands that businesses find innovative ways to digitally engage with potential clients and to figure out how existing services can be offered in new ways.

By using technology to create alternative avenues of communication and engagement, businesses can enhance their service offering while accommodating lockdown regulations to support customers’ goals of staying safely at home.

Closing the (social distancing) gap
During this time when alcohol sales have been prohibited, boutique liquor company Dry Dock has been providing innovative, virtual wine tasting events, discussing various wines in online webinars.

Participants who have a wine collection at home can open the same bottle of wine, or if they have the same type of wine such as a Sauvignon Blanc from a different brand, then the sommelier webinar host will discuss the differences between their wine and the other brand.

Here’s a perfect example of how a company digitally updated an age-old way of doing something in order to accommodate the current restricted parameters. They’re staying relevant even at a time when many businesses in their industry have ground to a halt.

Business can pivot to transform tangible, interactive experiences into online alternatives. This allows for a personalised environment where participants can enjoy a one-on-one engagement with the host.

Using a digital platform also extends audience reach to include a potential global audience that could experience your expertise at the click of a button.

Servicing the Covid-19 economy
Epione, a healthcare technology platform, has added a Covid-19 pre-screening symptom checker onto its platform which provides seamless access to health professionals. This new facility enables patients to monitor and evaluate the progression of their symptoms remotely.

An important lesson from this crisis is creating flexible solutions to meet people’s needs within the current environment.

By using expertise in your particular domain, business can focus on a key feature that addresses consumer demand and pain points at a given time.

Showing solidarity
Pivoting doesn’t always mean reorganising your business for gain or profit. Some businesses and organisations have pivoted to bring their solutions to frontlines to pull South Africa through the pandemic.

A shining example is Kim Whitaker, a hospitality broker who decided to lend a hand while her own business had come to a halt by founding Ubuntu Beds — an initiative that aims to unite hospitality businesses that now stand empty, with our healthcare workers who are fighting the virus on the front lines.

Another example is the Sasol Foundation sponsorship of The Lockdown Digital Classroom — a voluntary virtual classroom created to support student learning during lockdown.

By giving South Africans the opportunity to donate in instalments, we are providing a more flexible option to those wanting to make a difference, accommodating different budgets in the process.

Pivoting to address specific needs of groups such as the educational community allows a brand to demonstrate empathy and understanding. This communicates a message of solidarity with a focus that goes beyond profit.

By striving to make a meaningful difference to those around you, brands can foster brand loyalty and alignment both during and long after the crisis has dissipated, while making a positive impact on people’s lives.

Leveraging current infrastructure
Website developers Redshift have onboarded local supermarkets and suppliers onto their platform, allowing shop owners to accept orders from shoppers during lockdown. The pivot has enabled Redshift to expand their business offering and help to support retailers providing essential services.

This is an example of using current digital infrastructure to expand offerings to remain operational and viable in a challenging economic time.

Think about your core infrastructure and how this can be leveraged to create a new revenue stream.

The solution is in the problem
Facilitating the signing of legal documents has enabled innovative digital disruption in the legal arena. Registered Communication is an electronic communications provider which has transformed the traditional paper paper-based notification and hard-copy delivery of contractual documents into a legally compliant digital alternative,

This business has found a way to solve a new problem, creating services that solve the challenges of this new normal.

Think of the problems companies or people are facing as opportunities to find the relevant solutions: we need to rethink the problems we’re solving. Leveraging technology can help restructure your service offerings to meet new demand and generate welcome revenue.

Pivoting has always been an integral part of innovation even in everyday business management. However, the Covid-19 impact is accelerating the need for radical business transformation to ensure business survival and long-term success.

Businesses are re-imagining themselves and using disruptive technology to remain relevant.

Although pivoting comes with risk, inaction can pose a far greater threat to survival in the economic and health challenges of this unprecedented time.

South Africa’s Unemployment Insurance Fund has paid out just over 3.3 billion rand ($177.3 million) to people whose work and income have been affected by the coronavirus pandemic and a lockdown to curb the spread of the virus.

The fund has processed more than half the 103,000 applications that it has received from employers on behalf of about 1.75 million employees, Tourism Minister Mmamoloko Kubayi-Ngubane told reporters in a virtual briefing on Tuesday. That means that more than 862,000 people will receive their benefits. About 10,000 applications could not be processed due to errors and the affected companies have been notified to correct their applications and resubmit, she said.

The government has been criticized for inefficiency at the UIF, with the 40 billion rand set aside to compensate temporarily laid-off workers not being distributed fast enough. The fund is working to meet extra requests for assistance, Kubayi-Ngubane said.

Africa’s most-industrialized economy will implement a curfew from the start of May as it plans a limited return of its workforce into an economy that’s virtually ground to a halt due to a lockdown to curb the spread of Covid-19. This economic risk-adjustment plan spans six to eight months and the governments sees the peak of the virus curve in September, according to a statement from the Government Communication and Information Service.

The government has approved an allocation of 235 million rand to small businesses’ payroll, rental and utilities for the next three months. This funding will protect about 11,000 jobs, GCIS said.

Source: South African Government

During the course of its review of the Essential Service list of applications, the Companies and Intellectual Property Commission (CIPC) has established that certain companies not designated as Essential Services have either fraudulently or negligently applied on the Bizportal website (www.bizportal.gov.za).

As was made clear when the automated certificate was issued by the CIPC, that the provision thereof was based on information provided by the registered Company itself, and that possession thereof does not in itself constitute the right to continue operating during the lockdown period.

The operation of any essential service is subject to full compliance with the applicable lockdown regulations and that the company falls within the scope of essential services as defined in the regulations.

In a number of cases, companies have applied and received Essential Service certificates without compliance with the regulated conditions.

In terms of the applicable regulations during the lockdown, all businesses shall cease operations except for any business involved in the manufacturing, supply and /or provision of an essential service or goods.

It is a criminal offence for any business to continue operating during the lockdown period if it is not providing an essential service, as defined in the applicable regulations and direction, unless such business can be operated using work-from-home arrangements. It is also a criminal offence for any business which misrepresents the nature of its operations in order to obtain a CIPC certificate.

The CIPC, upon review, has established that pubs, taverns, restaurants, fast food places, pizza parlours and the like have registered to continue operating during the lockdown, in violation of the applicable regulations as per the Essential Service list. These businesses are not eligible to continue operating during the lockdown period in terms of the regulations and directions issued by Government.

Businesses in the CIPC database that are not eligible to continue operations during the lockdown have had their certificates cancelled and will be handed over to the South African Police Services for further investigation and potential prosecution.

Any business which is not authorised to continue operating during the lockdown in terms of the applicable regulations and directions should cease operations with immediate effect. Businesses which require clarification as to whether they meet the definitions of an essential service business may address their queries to their relevant business association.

Consumer confidence across the globe is plummeting as the coronavirus pandemic spreads, causing businesses to cease trading.

Stringent lockdown and social distancing measures are being enforced and updated daily, which in all likelihood will mean that confidence will deteriorated significantly.

“There’s not much individuals can do about the general economy. But on their personal financial situation, they know how much money they’ve got coming in, how much money they’ve got going out. So they can think about the next 12 months and think if I keep working, interest rates don’t go up, inflation is fine, then we can kind of be OK,” says GfK’s client strategy director Joe Staton.

But, while people aren’t planning to splash out on things like furniture or electrical goods, they are still spending money.

In the UK, spend on “durables” such as tablets, computers, hair clippers and freezers are on the up. GfK data shows revenues here grew 42% year on year in the 12th week of 2020, with online accounting for almost 50% of the market.

“Brands that can offer reassurance of quality and cleanliness, companies that treat their staff well, companies with a holistic approach to wellbeing of customers and staff, this is their time to shine,” Stanton says.

Brands need to think long-term amid the coronavirus pandemic

President Cyril Ramaphosa has ordered a 21-day lockdown in order to curb the spread of the novel coronavirus in South Africa. Businesses across the country are closed, wreaking havoc not only on bottom lines but also on marketing efforts.

In order to stay top-of-mind, try implement the following in your marketing:

Consistency involves messaging that is not only published at regular intervals, but that is the same across all channels and assets.

Brand recognition – consistent marketing efforts pay off when someone recognises an ad without ever hearing the brand’s name. Brands with distinct brand and marketing consistency are able to benefit from being easily recognised. This can help you build your brand and the trust consumers have in it.

Brand awareness – this is an important reason to create consistent branding and marketing. Customers are significantly more likely to purchase from a brand they recognise for their consistent image and content schedule, so make sure to maintain both with regularity. Your digital and visual content should be uniform so that your audience knows what to look for, and should be posted at similar times so they know when to look. Your visual content should stick to the same colour theme, photo quality and logo placement, and your digital materials should be consistent with that.

Create trust – customers are 71% more likely to purchase from a brand or company that they trust. Much like a friendship, building a reputable image is extremely important to your business. Being trustworthy is a major element in the success of a brand, and establishing that will help to build brand and marketing consistency. Posting your content on a regular basis at similar times, utilising the same platforms for specific purposes, and keeping messaging consistent will help to build trust.

Be memorable – the power of repetition is seen everywhere, from the movies to the classroom. We can all recall jingles we’ve heard on TV a thousand times, and printed logos that appear in digital and print media simply because of the sheer number of times we’ve been exposed to them. If you want your brand to be memorable, make your messaging consistent and frequent. The more often your customers and potential customers see your advertisements and branding, the more consistent and memorable your brand will appear.

Persistence – even when you don’t see the results you were hoping for – is critical for business owners working to build their business and brand.

Whether you use a website, permission-based e-mail marketing, social media, newspaper advertising, mobile ads or networking events to market your brand, persistence is key.

Time – rarely do marketing initiatives provide magical, overnight results. A lack of persistence means businesses may jump from one type of marketing strategy to another. It is tempting to do this, but it never allows sufficient time for any one strategy to produce results. It is a waste of time and resources.

Lack of success – often, a lack of success may be because the expectations and time frame are unrealistic and no one has given the strategy the time or the attention it needs to be successful. Putting an advertisement in one or two issues of a newspaper, on social media or in a newsletter, and then “pulling the plug” because you didn’t “see any results”, is an example of this.

Exposure – frequent exposure is usually needed before potential customers even begin to notice an advertisement, let alone consider taking any kind of buying action. This tends to be true for both online and print advertising.

Gimmicks – marketing gimmicks, such as sales, discounts or competitions, may not help if the product or service you are selling is not one that people think they want or need, or if your reputation in the marketplace is lacking.


The best strategic plan is only as effective as the material that supports it. Regardless of whether or not your selected channels are newspapers ads, radio spots, television ads, billboards, a website, direct mail, social networking or something else, you are only as good as the material your audience receives. Clarity is of critical importance in this strategy: are you clear about the single message and the desired call to action in your advertising?

Clarity of message – your audience is bombarded with thousands of messages every day. For yours to break through the clutter and have the desired impact, you need to be very clear about what you want to say. What single fact or idea should the audience remember or take away from the material? You should be able to refer to your previously-developed message to help you with this. Are you the fastest, bluest, cheapest or easiest – or the only one that does something, or the first one who did something? What is your unique selling point? Highlight the single most important thing you offer, and you have clarity. Avoid the temptation to try and tell everyone everything.

Clarity of purpose – what action do you want the reader, viewer or listener to take? Should they visit your website, call a number, stop by the store or clip a coupon? Don’t assume that they’ll know what to do or what you want them to do. Ask them; tell them. When you combine a clear message with a clear call to action, you dramatically increase the odds of success. Give your audience a reason to take action and give them an action to take. Clarity leads to success.

IT managers inundated with cyberattacks

A recent Sophos survey has found that IT managers are struggling to cope with the volume and magnitude of cyberattacks.

The following key findings relate to South Africa:

  • Cybercriminal tactics have evolved into using multiple attack methods and often multiple payloads to maximize profits
  • Software exploits were the initial cause of 17percent of incidents and used in 23 percent of cyberattacks, demonstrating how exploits are used at multiple stages of the attack chain
  • Phishing emails impacted 47 percent of those hit by a cyberattack
  • Ransomware impacted 38percent of attack victims
  • 39 percent of attack victims suffered a data breach
  • Only 16 percent consider supply chain a top security risk, exposing an additional weak spot
  • Nation state adversaries have proven how successful supply chain attacks are, which means common cybercriminals are likely to adopt the attack method
  • Supply chain attacks are a launch pad to emerging automated, active-adversary attacks
  • IT teams spend 27 percent of their time managing security, yet still struggle with a lack of expertise, budget and up to date technology
  • 74 percent said recruiting people with the cybersecurity skills they need is challenge
  • 65 percent said their organization’s cybersecurity budget is below what it needs to be
  • 73 percent believe that staying up to date with cybersecurity technology is a challenge

Source: Fin24

South African businesses of all sizes, including educational institutions, have been particularly hard hit by an onslaught of cyber-attacks, although this is not always public knowledge, according to Kerry Curtin, cyber risk expert at Aon South Africa.

Cyber risk was ranked as the #1 risk facing educational institutions and is likely to remain so for the foreseeable future, according to Aon’s 2018 global risk management survey.

Curtin says the potential theft or leakage of data, particularly confidential information in an educational setting, should be top of the list in risk planning.

“The need to strengthen institutional resiliency against potential damage, compromising hacks and downtime is crucial,” she adds.

This is because schools, like any other business, are increasingly dependent on technology. The knock-on effect of a cyber incident at an educational facility has the potential to be financially and reputationally catastrophic.

For example, in 2016 it was reported that the University of Limpopo’s website was taken down, leaking exam papers and the details of over 18 000 students, in addition to perpetrators publicly posting what was believed to be the login details for the University’s intranet.

The sheer number of cyber-attacks on educational institutions suggests that the sector is not as prepared as it should be in its efforts to safeguard networks, according to Curtin.

Aon provides the following tips for the education sector:

Safeguard institution-owned devices

All computers, laptops and smart devices owned by the educational institution should at the very least have a current anti-virus programme installed, in addition to adware and malware protection.

One of the biggest threats to any business is the people operating these devices and their naivety regarding cyber risks, so education is key.

BYOD policy

The practice of students and staff members bringing devices to school or university that interact with the institution’s network is very likely. The first line of defence is keeping guest devices separate from the network, allowing the institution to keep data secure on an administrative network, as well as monitor traffic more closely.

When it comes to sending sensitive information, it is crucial to implement a secure file exchange solution that can protect against cyber threats such as phishing scams.

Multi-factor authentication

While passwords alone do not provide adequate levels of security and hackers are able to circumvent physical biometrics such as fingerprint identification as a single layer of authentication, Multi-Factor Authentication (MFA) is fast becoming the next line of defence.

Social media policy

Not only does the policy need to stipulate what is deemed as acceptable behaviour from employees and students, but it also needs to explain what the benefits are of becoming an ambassador for the brand and the legal ramifications inherent to social media platforms.

Plan ahead or miss out on 2018’s tech trends

Technology is disrupting the world in ways we’ve never seen before, in nearly every industry – and it will irrevocably change the world of work in the future.

That was the overriding message from a recent Business Day Dialogue, held in partnership with Dimension Data and Cisco, on technology trends in 2018 and beyond.

The biggest challenge facing organisations today is the burden of old technology and capability, said Stephen Green, chief technology officer at Dimension Data Middle East and Africa. Companies that have been around for 10 years or more need to digitise their systems or risk being left behind.

Peter Prowse, vice-president of strategic partnerships at Dimension Data, said legacy infrastructure had to be prepared for the journey ahead. Established companies will shore up their technological infrastructure in the years ahead to help them adapt to an unpredictable market.

He said organisations had to plot a route beyond the digital infrastructure horizon. The first step is to implement programmable infrastructure. “More organisations will be considering networking and security requirements in the development phase and programming their applications to take advantage of software-defined infrastructure.”

The second step involves understanding the platform economy. “In the year ahead, businesses will start to recognise the true potential of the platform economy, the impact it will have on their operating models and the changes they will need to make, including digital front-ends and a higher level of risk,” said Prowse.

Third comes a shift in focus from technologies to services architecture. “Hybrid IT is now generally accepted as the model of the future. However, many organisations are far from having the technology in place, so we expect to see businesses future-proofing or upgrading their business architecture.”

In an era of digital disruption, Prowse added, speed trumps cost. Companies are aware of the risk of failing to adapt fast enough and will therefore choose the technology they can use the fastest.

Last, there will be a surge in interest in software-defined wide area networks, with wireless technologies, networks and wireless-enabled processes expected to leap ahead.

More trends to consider
Other trends in technology that will affect businesses are artificial intelligence (AI), machine learning, robotics, and virtual and augmented learning, all of which will deliver compelling and complementary outcomes, said Green.

These disparate technologies will come together in the year ahead to create useful business applications. AI will drive voice-enabled virtual assistants in the workplace and everyday tasks will be automated, reducing costs and speeding up processes.

Smart buildings will evolve into smart workplaces, and increasingly employees will ask to bring their own devices and apps to work. “Businesses will have to rethink their value proposition,” said Green.

Cybersecurity will continue to be a threat. Companies will start investing in technologies aimed at gaining the upper hand against cybercriminals, including using blockchain innovatively.

During a panel discussion, moderated by Aki Anastasiou, on how technology would affect the future, Tiso Blackstar Group head of digital Lisa MacLeod explained how technology had disrupted the media industry and the steps the company was taking to transform digitally.

She spoke about the challenges posed to business as a result of a lack of digital and development skills in South Africa, as well as the country’s high data costs, which she said entrenched inequalities in our society.

“South Africa has the most expensive data costs on the African continent, which is a huge issue,” MacLeod said.

Commenting on a local shortage of IT skills, Garsen Naidu, head of channel at Cisco Sub-Saharan Africa, said there was a looming global shortage of cybersecurity specialists. He added that South African curricula had to be adapted to teach relevant skills, including teaching children to code from a young age.

Technology offers huge possibilities for the future, and it is how we use those opportunities that is critical, he said.

Giving a millennial’s perspective on technological disruption, Arye Kellman, founder of influencer marketing agency TILT, said millennials did not call it disruption or technology – to them, it was merely the way everything worked.

Source: Business Day https://www.businesslive.co.za

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