The number of new businesses is forecast to increase dramatically
This pandemic is creating some interesting opportunities for those willing to take them.
I've just finished writing a thought-leadership article for one of Sanlam's client publications.
In the article I suggest that the combination of record low interest rates, the new consumer demand for locally-produced products and the fact that so many people have been retrenched, or made redundant from their steady jobs - means that there is a very good chance that we will see a dramatic increase in the number of new businesses that will be started here in South Africa.
Money is now so damn cheap you'd be crazy not to be borrowing some to start a new asset of value from banks who's lending criteria is back at pre-2008 levels of strictness.
To this point - The Economist now reports that the USA is recording a significant rise in the number of new entrepreneurs in that country.
'The entrepreneurship boom bodes well for the future. A recovery with lots of startups tends to be more jobs-rich than one without, since young firms typically seek to expand, hiring new staff. Talk to the owners of new enterprises, and it is hard not to feel optimistic about America’s economic prospects. “People in general are tired of staying indoors, so if they feel safe at an establishment, they’re gonna come out,” says Matt, who with his wife Thao has just opened Smokin Beauty, a Vietnamese-inspired bbq joint in Austin which boasts plenty of outdoor seating. Buzzer, a platform which allows people to see clips of sports events, proudly describes itself as “a company born during a global pandemic that has paused all live sports”.'
'America’s new crop of entrepreneurs is moving away from dying sectors and towards up-and-coming ones. In most industries the number of sole traders is in decline, yet in the past year the number working in the information sector, comprising jobs such as data-processing, web-search portals and publishing, has risen by 50%.'
In my opinion, the global pandemic could well be the elusive catalyst for change so desperately needed to kick start the South African economy in a more sustainable direction.
Sure we have significant challenges to solve still, but we had major challenges before and zero urgency to think of new ways to solve them.