This archive report was first published on 6 July 2021.
East Africa Family Businesses Show Resilience Amid COVID-19 ¶
On May 25th, PwC launched the Family Business Survey, which revealed mixed performance among East African family businesses in the last financial year. While 46% experienced growth, 31% saw a sales reduction.
However, the survey also showed that East African family businesses are more optimistic in 2021, with 60% expecting growth. This optimism is expected to continue in 2022, with 91% of respondents anticipating growth.
The key priorities facing East African family businesses over the next two years include expanding into new markets and client segments, increasing the use of new technologies, introducing new products and services, and rethinking their business models.
According to the survey, levels of trust, transparency, and communication are high in family businesses in East Africa. Just under three-quarters of East African family businesses feel they have a clear sense of company and/or family values, which have helped during the COVID-19 pandemic.
Michael Mugasaa, Partner and Entrepreneurial & Private Business Leader at PwC, noted that the strong fundamentals of family businesses, including commitment to values and long-term thinking, put them in a strong position for faster recovery from the pandemic disruptions.
East Africa family businesses are slightly more likely to have at least one issue related to sustainability or the local community as a key priority, compared to global respondents. 83% of East African family businesses engage in some form of social responsibility activities, which tend to involve contribution to the local community or traditional forms of philanthropy.
However, only a quarter (25%) of these businesses have a developed and communicated sustainability strategy.
Family businesses in East Africa are rising to the challenge at a time when financial uncertainty has already impacted many of their forecasts. While 60% anticipate growth in 2021, a much higher percentage – 91% – expect that their businesses will grow in 2022, an impressive level of optimism.
Cedric Mpobusingye, Partner at PwC Uganda, emphasized the importance of agility and responsiveness in business, including the ability to forecast and model different potential outcomes, depending on an investment strategy or a product launch's reception or possible disruptions to the supply chain.
