Kenyan businesses are the worst hit among Sub Saharan Africa as 65% of small businesses operating on Facebook reduced their employee numbers as a result of the pandemic. Ghana follows next at 47% with South Africa and Nigeria at 45% of small businesses sending some workers home due to low sales.
The Global State of Small Businesses Report by Facebook, in collaboration with the World Bank and the Organization for Economic Co-operation and Development (OECD), says that more than a quarter of the businesses in over 50 countries closed down between January and May, further lengthening the global job crisis. Also, nearly two-thirds of small businesses globally reported slow sales, the tourism and hospitality sector taking the worst hit.
See Also: COVID-19 Support Available for Businesses in Kenya
According to the report, 75% of Kenyan Small enterprises reported lower sales in the first five months of 2020 compared to a similar period last year. On the other hand, Ghana reported that only 56% of its businesses recorded sips in sales, while Nigeria and South Africa recorded 59% and 67% respectively.
Digital is the New Frontier for Small Businesses
Kenyan businesses could weather the pandemic by moving more sales operations online, similar to other countries. Despite high mobile and internet penetration in the country, only 46% of Kenya’s small businesses get more than 25% of their revenues from digital platforms. This compares to 68% small enterprises in Ghana and 62% in Nigeria who generate over a quarter of their sales online.
“The only way for small businesses in Kenya to survive the pandemic is to pivot to digital. For example, in Ireland, 65% of operational businesses on Facebook reported that 25% or more of their sales were made digitally in the past month. This is considerably higher than Kenya where 46% of operational businesses on Facebook report the same,” reads the report.
In Kenya, apps like Facebook and WhatsApp boast the most usage with WhatsApp at 89% and Facebook at 81%. By June 2020, Facebook accounted for almost half of the social media market share in the country.
