Exploring COVID-19 Challenges and Coping Mechanisms for SMEs in the South African Entrepreneurial Ecosystem

Abstract

Globally, COVID-19 has caused significant damage, including business closures and changes in how entrepreneurial activities are performed. The pandemic has spawned a slew of publications with the majority thereof being editorials, commentaries, and concept notes. This implies a lack of empirical evidence on the pandemic. Therefore, the purpose of this paper was to explore the COVID-19 challenges and coping mechanisms for small and medium-sized enterprises (SMEs) in South Africa’s entrepreneurial ecosystem. Data for the study were collected from 15 SME owners through semi-structured interviews using a generic qualitative research method. The findings revealed that the SME COVID-19 challenges included lockdown restrictions, customer loss, lack of government support, and scarcity of raw materials. The coping mechanisms used by the SMEs were having a positive entrepreneurial mindset followed by reduced service prices and the retrenchments of employees. Theoretically, the study contributes to the scarce empirical evidence on COVID-19 challenges and coping mechanisms for SMEs in the South African context; to the available literature in the entrepreneurial ecosystem context and to the world at large. Practically, it is recommended that during crises, businesses should network with one another to remain operational and, owing to e-commerce, they are encouraged to have an online presence.