The FEM CFO shares his concern for the future of small businesses amid increased loadshedding.
While loadshedding isn’t new to South Africa, the recent move to stage six has threatened the hybrid work policy that was brought on during Covid-19. The Federated Employers Mutual Assurance Company (FEM) CFO Yusuf Bodiat explains that the increased and more aggressive loadshedding has resulted in many employees needing to go into the office, which has the necessary back-up systems in place to keep the lights on.
“From a financial perspective, these back-up measures, which include petrol and diesel generators, come with significantly high costs, both in terms of maintenance as well as the increased price of fuel,” the 2022 CFO Awards nominee adds.
Additionally, the National Energy Regulator of South Africa (Nersa) last week announced that it has agreed to Eskom’s tariff increase of 18.65 percent, which will see a significant increase in costs for many organisations.
“The tariff hike is placing a significant amount of pressure on all stakeholders, with the most vulnerable being small to medium-sized entities,” Yusuf says. “I am concerned that these entities may not be able to survive through a prolonged loadshedding cycle, resulting in decreased revenue for our company in the future.”
However, Yusuf adds that, despite how dark the future may seem, South Africans should remain hopeful, as “this too shall pass”.