International Journal of Small Business and Entrepreneurship Research (IJSBER)

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Impact of Covid pandemic on Small and Medium-sized Practices in East Africa


The Covid-19 (“Covid”) pandemic caused small and medium-sized businesses (SMEs) to close down or shrink substantially in 2020 and 2021. These SMEs constitute over 95% of enterprises in most countries of the world. As the trusted business advisors to the SMEs, there was a unique need to find out how the small and medium-sized practices (SMPs) themselves were affected by the pandemic. By October 2021, a representative sample of 197 SMPs from Burundi, Kenya, Rwanda, Tanzania and Uganda had responded to the abridged closed-ended questionnaire. In an earlier study completed in 2019 (adopting a much broader questionnaire), a total of 409 SMPs from Kenya, Tanzania and Uganda had responded. The SMPs had reduced in terms of employment. SMPs with less than 10 personnel had increased from 34% to 38%. The SMPs used only 12 days for development/training (benchmark = 20 days) and the utilization ratio was only 52% (benchmark >70%) implying pandemic had disorganized teamwork and staff morale. On a positive note, the charge-out rates had increased marginally by 2% to USD264 per day. Clients billed had increased by 20% to 79 per annum but the average fees per client fell by 6% as clients tried to cut costs due to the pandemic. That notwithstanding, the average revenue per SMP increased by 28% to USD296, 000 per annum implying that SMPs (as a bloc of businesses) benefitted during the pandemic period. The study was purely quantitative hence the qualitative aspects of how the SMPs in East Africa managed to cope with the lockdowns have not been captured. Secondly, this study was limited to income side (due to its lower sensitivity) but the sustainability of SMPs can also depend on their level of operating expenses, profitability and partner drawings. SMPs in East Africa should benchmark their individual practices to these research findings. Evidence shows that more and more SMPs are being licenced annually hence competition for fees is likely to increase in coming years. This study had contributed to literature about the Covid pandemic and its influence on the SMPs and the methodology can be adapted to other regions in Africa.


Keywords: : Human Capital, Competitiveness, Covid pandemic, SMPs

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