African SMEs’ Performance and Behaviors during COVID-19

Executive Summary

After COVID-19 outbreak, the African Union in collaboration with UNDP and AfriLabs worked together to implement the frst African business simulation that seeks to help Micro/Small/Medium Enterprises MSMEs to overcome the current COVID-19 challenges and the lockdown. More than 400 participants and 10 diferent partners have been involved in building and participating in the simulation in 2020 from 5 diferent countries: Cameroon, Egypt, Sudan Senegal, and Zimbabwe. The main objectives were to guide and help the participants to adapt their business strategies during the pandemic and to help governments and decision makers to better understand the current impact and the new positioning of mSME during COVID-19. This report will cover 4 main parts: (1) Rollo Business Simulation (2) mSMEs Dynamics and behaviors (3) Impact of COVID-19 on small businesses (4) Program Recommendations. Business Simulations have been used for longtime in capacity building in diferent international universities and big corporations as a learning-by-doing technique. In this project, we introduced it for the frst time for small businesses in Africa as a new tool for online capacity building helping business owners to test their strategic decisions and managerial skills in a risk free environment. 85% of the involved SMEs and participants indicated they were satisfed/very satisfed with the simulation experience while 98% indicated that it was their frst time ever to know about business simulation. The Simulation was successfully implemented from August 2020 to January 2021 in form of a business simulation competition managed and implemented by AfriLabs local partners and innovation hubs. The local hubs implemented the recruitments, interviews, shortlisting, and facilitated the local Simulator.

The key results of the project:

1- Training of 360+ African Entrepreneurs from 120 Small businesses to make business and fnancial decisions in diferent market outlooks like: fnancial recession, global pandemics using advanced business simulation technology. The total amount of hours spent in the simulator exceeded 1,500+ working hours/ 60+ Cumulative days. 2- Collecting signifcant data from 5 countries: Cameroon, Sudan, Egypt, Zimbabwe, Senegal that can help policy makers and fnancial institutions to be better understand and monitor the impact of COVID-19 on small businesses this include: fnancial performance, business continuity plans, health, security, safety, access to fnance and debt management, ofce space, access to resources, business model alterations, digital transformation, cyber security, and governments responses. 3- Identifying the level of competitiveness of African businesses compared to worldwide trends in the simulator. Egypt scored 98% followed by Sudan 95.5% and Senegal 90%, Zimbabwe 87.5%, and Zimbabwe 87%. A score of 100 would refect that the team/country performs inline with the benchmark. The benchmark is set by accumulation of previous participants inputs/decisions. Above 100 refects superior performance to benchmark, below low 100 indicates less than adequate performance relative to benchmark.

4- Modeling African SMEs decision making process departing from the following business aspects: Setting product pricing, setting fnancial goals, Asset management, fnancing,


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