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Impact of COVID-19 on MSMEs

Ms Njeri, a fruit and vegetable vendor in Nairobi, Kenya. Photo by: Valine Moraa

Impact of COVID-19 on MSMEs

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Micro, Small and Medium-sized Enterprises (MSMEs) are manufacturing and service sector businesses, which generally employ less than 250 people. They are the growth drivers and the basis of livelihoods for millions of people around the world. Every year, 27 June is marked as the World MSME Day. This year, the MSME Day is marked with the theme, ‘COVID-19: the great lockdown and its impact on small business’. MSMEs have experienced the effect of COVID-19 pandemic in many ways, from health and safety of employees and customers to severe supply chain disruptions.

BioInnovate Africa supports creative ideas that enable MSMEs to become economic growth stimulants at national, and regional level and contribute to sustainable development and poverty alleviation. At BioInnovate Africa, scientists and researchers from universities and research organisations work collaboratively with MSMEs in Burundi, Ethiopia, Kenya, Rwanda, Tanzania, and Uganda to pilot and bring to market innovative biological-based ideas, inventions and technologies.

As part of this year’s World MSME Day, we share the effects COVID-19 pandemic has had on some of our MSMEs partners, how they are addressing the challenges, and what they see as emerging opportunities:

“We produce and supply high-quality certified sweet potato vines (seeds) to smallholder farmers and vine multipliers in semi-urban and rural areas. COVID-19 pandemic came at the peak of the first planting season for the vegetative crops we supply in Uganda. Our production and sales went down due to the travel restrictions within the country – the lowest we have ever recorded. We had to reevaluate how to connect with our clients. Using mobile phones, we have formed WhatsApp groups where clients can now make early orders in preparation for the second planting season, which begins in August.” Dr Settumba Mukasa, co-founder of SENAI Farm Supplies Limited in Uganda. Learn more about them here.

“We develop and provide new and affordable biopesticides to farmers. The lockdown within the country due to the COVID-19 pandemic interfered with our supply and production activities leading to a loss of 25% in revenue. To address this challenge, we decentralised activities in the field by creating sub-centres within farmer representatives to bring our services closer to the farmers. We are developing a digital platform that will link farmers and agro-dealers to the market and enable us to interact and provide them with our services. We are also exploring services such as radio and digital training for our field activities.” Grace Luballo-Onyimbo, director of HottiServe East Africa Limited in Kenya. Learn more about them here.

“We design, fabricate, supply, and provide maintenance of agricultural machinery. Our business activities reduced by more than half due to the COVID-19 pandemic. The lockdown led to low product sales. We had an inadequate supply of raw materials. We also had to lay off some of our employees. We are now increasingly using online platforms to connect with our clients.” Joseph Kavuma, general manager of Tonnet Agro-Engineering Limited in Uganda. Learn more about them here.

“We produce and sell biopesticides both locally and internationally. We also offer trainings on pest management, the use of pesticides, and good agricultural practices. Restrictions on travel and movement due to the COVID-19 pandemic resulted in a reduction in our sales revenue by 40%. We had to put on hold our trainings, and we received cancellation of orders from both local and international floriculture industries and small-scale farmers who are our main clients. Cargo charges also increased. We resorted to using online platforms to reach our clients. In a way, it is an opportunity for us to improve our communication and adopt online systems as a long-term strategy.” Samuel Ngugi, general manager of Real IPM Kenya Company Limited. Learn more about them here.

“We produce high-quality Aroma Honey Toffees as a healthier option for people who love candies. Our business experienced both challenges and opportunities as a result of the COVID 19 pandemic. Travel restrictions led to cancellation and postponement of orders. We had to adopt online purchase orders, and somehow our sales have started to increase. We are exploring various online advertising opportunities, including printing on reusable facemasks.” Dr Sarah Mubiru, founder and managing director of Aroma Honey Toffee Limited in Uganda. Learn more about them here.

“We produce natural and safer mosquito repellent products from plant extracts in the form of soaps, sprays, sanitisers, and lotions. There has been a surge in demand for our soap products and other detergents due to the COVID-19 pandemic. To meet this demand, we increased our production capacity by hiring additional staff and working extra hours.” Ginette Karirekinyana, founder and director of Karire Products Limited in Burundi. Learn more about them here.

“We produce and sell nutrient-rich substrate blocks for mushroom cultivation in East Africa. As a start-up business, we have had to postpone planned trainings with our potential customers. Orders for our products were cancelled due to the uncertainty of the COVID-19 situation in the country. We are exploring interventions to support our business in the wake of COVID-19, and hope that the threat associated with the pandemic will reduce.” John Kimario, founder and executive director of OKOA Mushroom Supplies Limited in Tanzania. Learn more about them here.

“We rear black soldier flies, which produce larvae that recycle organic waste sourced mainly from hotels. Our business in Kenya was the most affected by the COVID-19 pandemic. Closure of hotels due to lockdown and with the restriction on travel and movement, we have had to look for alternate waste sources within the county to feed the larvae. This caused drops and delays in our production cycle. We are exploring new opportunities to market and sell our products.” Kigen Compton, founder and managing director of BioBuu Limited, operating in both Kenya and Tanzania. Learn more about them here

“We produce and package fruit juice drinks. COVID-19 pandemic has reduced our sales revenues, increased the prices for our raw materials, and restricted the movement of goods to our customers. As a result, we have let go of some of our employees because of reduced production.” Sam Turyatunga, chief executive officer of Tursam Investments Limited in Uganda. Learn more about them here. 

Click here to learn more about BioInnovate Africa, and here to learn more about icipe.

Written by Valine Moraa