Lockdown shouldn’t be a holiday for tourism SMMEs

With hotels, guesthouses and restaurants closed due to the COVID-19 national lockdown, smaller enterprises in the hospitality industry in particular face a battle for survival even in light of the relief measures for SMMEs government has announced. The lockdown time could be put to good use to make such businesses more competitive and efficient.

This is according to Robyn Christie, consultant to the travel and hospitality industry and advisor to Agility Hospitality. “This is an exceptionally difficult time for the industry,” she says.

Christie notes that although many of the bookings over this time have been postponed rather than cancelled, which at least provides some liquidity perhaps at this stage or during the lockdown, “the reality is that many smaller businesses will struggle to survive with three weeks’ lost revenue”.

“Smaller hospitality businesses in particular, such as owner-run B‘n’Bs and guesthouses, often do not consider it necessary to develop a disaster management plan. As the present crisis shows, we all need to plan for the unexpected and this is the ideal time to strategise and future-proof your business.”

She points out that these businesses very seldom have reserves to carry their business for a month or two. “Now is the time for such business owners to examine every cost and expense, look into more cost efficient payment and invoicing systems and find ways of making their businesses run more efficiently and better,” Christie advises.

“In personal finance we are advised to save three months’ salary in case of an emergency – and I would encourage hospitality SMMEs to look at their pricing structure to build reserves in much the same way. While pricing needs to be competitive, it is also absolutely necessary to put money back into the business and build savings.”

She warns that the economic pressures faced by companies and individuals, working in this industry among others, as a result of the COVID-19 outbreak can also create an environment of greater susceptibility to scams and fraudulent activities.

“From a business perspective, we need to strengthen our defences against cyberattacks and malware, and be particularly cautious about criminal activity. Protecting the business and its customers is paramount.

“We also need to do our utmost to ensure the wellbeing of the staff who are unable to work at this time. Mental wellness is going to be a big challenge during lockdown, because one never knows the extent to which people are in debt, struggling in their relationships or grappling with substance abuse, for example. All these problems may be exacerbated under lockdown conditions,” she says.

Bianca Viljoen, director of the Agility Hospitality Employee Benefits programme, points out that businesses making use of the Agility Hospitality solution have access to resources to help their staff through this potentially challenging time.

“In addition to the medical scheme benefits, including for COVID-19, available to members of Health Squared Medical Scheme, Agility Gap & CoPay, Agility StaffCare or the flexible access to healthcare provided through the Agility Healthcard, the free Agility Rewards programme offers telephonic support services that will continue to operate as usual during the national lockdown,” Viljoen says.

These services include:

•  24/7 confidential and unlimited access to personal support and psycho-social counselling;
• Telephonic HIV /AIDS counselling;
•  Life management services inclusive of legal, financial and family care services;
  Christie says that the lockdown will give pause for thought for many business owners to consider the range of risks that can be mitigated through taking care of staff members as part of any small business’s day-to-day operations, as well as in the context of a disaster management plan.

Viljoen advises that the best way to ensure the business is protected from such risks is through an integrated human capital approach that encompasses occupational health, preventative and curative care.

“Where these aspects are dealt with separately, opportunities to identify and proactively manage risk can easily be missed. For this reason, Agility has developed a fully integrated service and product offering to meet the needs of the South African hospitality and tourism industry.”

Agility StaffCare takes care of occupational health among low-income employees, Agility Employee Wellbeing provides holistic preventative and productivity management, incorporating absenteeism management, while Agility Life offers group life, disability and other group risk benefits. Medical scheme and health benefits, from primary through tertiary healthcare, are available through Health Squared Medical Scheme, Agility Gap & CoPay, and the popular Agility Healthcard. Completing this 360-degree solution, Agility Retirement Fund Solutions caters to the need for retirement benefits.

“Investing in an end-to-end employee health, risk and wellbeing solution provides an opportunity for employers in the hospitality industry to safeguard their workforce during the current COVID-19 lockdown and into the future, so that businesses will be top of their game when our hospitality industry is able to re-open,” Viljoen concludes.