Worldwide, small and medium enterprises (SMEs) are the backbone of a thriving economy. They make up a substantial portion of companies and are estimated to contribute more than 87% of jobs globally.
A recent World Economic Forum report showed major disruptions affect the value chain of SMEs significantly more than they do larger enterprises. Disruptions, such as Covid-19 and geopolitical tensions, often lead to failure among these businesses.
In South Africa, an example of a significant risk to SMEs is the acute shortage of power. Blackouts mean they can’t operate. No production or trade is possible and inventory is damaged. The enterprises can’t plan and execute their operations effectively or meet customers' demands. They lose revenue and clients.
South Africa’s power shortages are likely to continue for some time. In this regard, we believe a sharing economy could minimise disruptions.
The concept is based on apportioning and collaborating through digital platforms within a community with similar characteristics. Based on work from our doctoral research specialising in the digital transformation of SMEs, we argue that they could use the platforms to minimise the adverse effects of ongoing power cuts.
For example, they could share energy generation infrastructure such as mobile battery storage units, portable generators and solar panels.
By sharing resources and equipment, SMEs could reduce operational costs and increase their resilience. The sharing economy could also help them connect with other businesses in their community, creating new opportunities for collaboration and partnerships.
There are examples of this approach working elsewhere.
SonnenCommunity is a platform that allows homeowners with a battery-based energy storage system to share their excess energy with community members. It’s used in a host of countries, including Germany, Australia, the US, Italy and the UK
SonnenCommunity is a platform that allows homeowners with a battery-based energy storage system to share their excess energy with community members. It’s used in a host of countries, including Germany, Australia, the US, Italy and the UK.
Members of this community are connected through a digital platform that enables energy trade and communication between them.
Another example is Gridmate. This is a peer-to-peer energy-sharing platform allowing people to donate energy to those in need.
In the South African context, energy generation infrastructure could be shared among community members with different scheduled power cuts. This could include portable generators and mobile battery storage units.
However, for the system to work communities must be in proximity to one another. This is because the scheduled power cuts are normally set up in a way that one zone will have power, while another's is out.
The process is powered by digital platforms that facilitate sharing. For example, a digital platform could be set up by local business forums to share purchasing, crowdfunding, crowdsourcing and promotion of collective consumption.
Power outages are having a ripple effect on the economy. They cause delays in the delivery of goods and services, affecting consumer confidence and ultimately leading to a decline in economic growth.
For some SMEs, load-shedding is a life-and-death issue. The sharing economy would allow them to continue making a living.
This is particularly true for businesses operating in disadvantaged communities. These often face additional challenges in accessing energy due to location, limited infrastructure, financial constraints and other factors. A more affordable and equitable energy system would allow businesses to share resources and infrastructure.
• Olunloyo is a doctoral candidate specialising in the digital transformation of small, medium and micro enterprises (through the sharing economy), master in business administration (MBA) digital marketing expert, University of Johannesburg. Moloi is a professor and director at the Johannesburg Business School, University of Johannesburg
This article first appeared in The Conversation Africa
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