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Bianca Mlilo, Business Reporter
FACED with the reality of cash shortages and limited daily withdrawals at banks, several small to medium enterprises have resorted to credit sales to survive.
A snap survey conducted by Business Chronicle has revealed that most small businesses rely on cash sales as they do not have point of sale (POS) machines for plastic money usage.
With continued cash shortages and lack of POS, the going has become tough for many small businesses.
Max Hardware, a local building supplies firm in Bulawayo, is one of the affected small businesses that have introduced a credit scheme for faithful customers as a way of dealing with the prevailing cash crisis.
Co-director Mrs Theresa Sibanda-Sithole hoped that credit sales would make an impact especially during the festive season.
“Everybody is aware of the state of the economy and the biting cash crisis. It is up to us, not only business people but Zimbabweans to be able to introduce measures to survive. That is why as an emerging company we have introduced competitive prices and services to cushion our clientele and also to remain afloat in the industry,” she said. “We are now offering a credit facility, which is based on the relationship of the customer and the company. Shelter is important and people need to invest in it. People need to invest in property and that is why we are offering such services and products.”
Mrs Sibanda-Sithole said their credit scheme and payment plans were available to customers they have dealt with since the inception of the company. She said their marketing strategy was to attract locals working outside the country as they were involved in many building projects. To this end, she said, they had embraced social media as a marketing tool, which was yielding fruits for them.
Mrs Sibanda-Sithole, however, complained over the doubling up of roles by wholesalers who now offer hardware services thereby threatening their businesses.
Some small business operators said the introduction of bond notes into the market has not yet changed the situation as depositors struggle to get their monies from banks as evidenced by persistent queues. Banks still restrict withdrawal to an average $50 per day despite injection of up to $17 million worth of bond notes in the last two weeks.
Miss Julia Tshuma (25) who operates a flea market stall selling clothing and school ware at corner Herbert Chitepo Street and Fifth Avenue said:
“As you can see business is very low. This cash crisis issue has hit us very hard and putting together capital is no mean feat,” she said.
“Before this whole thing (cash crisis) started I could take home about $150 a day. I am now getting $30 a day because people just do not have the cash anymore.”
Vending stall operators said they were now generating half of what they used to make per day when the cash situation was still stable. “My child you know our business very well. We rely on small cash denominations. Since people struggle to withdraw cash many prefer to go and swipe at big supermarkets where they even buy tomatoes and other vegetables,” said a woman who only identified herself as NaSandra.
“This means no one is buying our products here on the streets and that makes our survival difficult.”
Another entrepreneur Mr Edwin Khaka said the inconvenience and costs associated with mobile money and Real Time Gross Transfers (RTGS), were also discouraging customers. “There are instances where clients pay me varying amounts going up to $500 but it takes more than a week to pay up the full amount,” he said.
“Imagine this; the maximum withdrawal amount at most banks is $50. That person has other expenses to meet on a daily basis so he/she will give you less than $50. That means it will take more time to pay off that amount.”
Small to medium enterprises are a critical pillar in the country’s economy with estimates indicating that more than 60 percent of people survive on proceeds from the sector.
@BiancaMlilo
Online Reporter