Grassroots Self-Reliance: Local community gatherings like this Winter Market are becoming the ultimate economic safety net for working-age South Africans looking to create alternative, micro-income streams.
Before we look at the reality on the ground, here is the cold, hard data hitting South African pockets this week:
- The REPO Rate Shock: The South African Reserve Bank’s Monetary Policy Committee just hiked the repo rate by 25 basis points to 7.00% (Prime is now at 10.5%). This immediately increases the cost of home loans, car repayments, and credit cards.
- The Retail Squeeze: Highlighting the collapse of middle-class spending power, The Spar Group issued a massive profit warning this week, expecting headline earnings per share to plummet by 50% to 60%.
- Fuel Price Split: On Wednesday, petrol consumers face a hike of around R1.50 per litre due to tax and levy adjustments, while diesel drops significantly between R3.50 and R4.40 per litre.
- Electricity Hikes Locked In: Municipalities are finalizing their budgets following NERSA’s directives, locking in a 9.01% municipal electricity tariff hike that takes legal effect on July 1st.
Desperate for Money: The Harsh Reality of South Africa’s Dysfunctional Economy
People in South Africa are desperate for money. This is because of the economy. Now, we all know about the three decades of misrule by an elitist, high-flying political group, but we don’t want to get into that right now. The fact is, people are suffering.
I’ve seen things on Facebook lately where people who were once highly successful in life are now openly begging for money, for food, and for a place to stay—just a roof over their heads. It is the end of the line for them. They’ve got absolutely nothing left.
How do people land up like this? Well, there are many factors, but things change. Markets change, the economy changes, and in this country, things only seem to get worse—and they have got worse.
The Great Divide
Of course, there is a minority of people who are still living the high life. They are taking overseas holidays at the drop of a hat, enjoying coastal getaways, and making money hand over fist from big property sales commissions and other small niches they’ve carved out.
This stark contrast brings me to the point that perhaps Warren Buffett was right all along: invest in the basics. Invest in Coca-Cola—basic things like cool drinks, grocery products, breakfast cereals, and furniture. These are the things that people absolutely need in their everyday lives, and if you can sell them in high volumes, you’ve got it made.
I was looking at a smaller local food producer this week. All the products he is manufacturing are absolute basics: snacks, breakfast cereals, soya sauces, and the like. He is achieving massive volumes at a very low price point. Crucially, he is achieving those volumes through the general trade—the bottom end of the market. It is the trade that people nowadays call the “informal sector,” and it is where everybody is trying to get into right now.
People are desperate to tap into it because the rich market is simply not growing. The wealthy market is tiny in comparison to the millions of people living in township conditions—often in squalor—but who are doing the basic work in this country and bringing in money.
Squeezing the Formal Channels
Even within the formal structures, the squeeze is on. I was speaking to a corporate sales representative the other day, and it is incredibly tough out there. I won’t mention the industry, but her takings for the month were much lower. Because of winter sales, the company had wiped out excess stock, and this year-end reconciliation—where the company balances the customer’s account and deducts unsold stock—was taken straight off her sales target.
Things are getting genuinely bad, and this is why a lot of ordinary South Africans are looking at alternative ways to make extra income. It isn’t the people living the high life who are pivoting; it’s the people in the townships looking at every single way to make money by selling goods. Whether it’s second-hand clothing, Tupperware, prepared meals, or arts and crafts, the list goes on and on.
The Reality of the Creator Economy
This is where creativity—or let’s call it innovation—becomes so vital. By definition, people in the creative economy are creatives. That could include anyone from architects and landscape architects providing high-end aesthetics, to everyday innovators trying to survive. These creator economies have become crucial in our dysfunctional country.
However, we have to be realistic. First of all, it is not easy to find a viable niche. Secondly, if you think you are going to make quick money on major social media platforms, you’ve got another thing coming. Those platforms are owned by massive corporations. Yes, there are a handful of people making good money on YouTube, but they are the absolute minority. They are highly tech-savvy people who deeply understand the inner workings of that business. For the ordinary person trying to make a living on Instagram, it’s a trap.
Perhaps platforms like Shopify are a better route for e-commerce. I know of a specialist niche operator in the UK whom I have bought from in the past. He found that running his own independent online business became so expensive that he migrated his entire store to Shopify. He told us that it is far cheaper and carries a much lower administrative burden.
But remember, those are still the high-end areas. On the ground here, survival looks different. People are knitting wool jerseys for winter. They are selling goods at fetes, local bazaars, and Saturday morning markets. South Africans are thinking of every imaginable way to make money, because otherwise, they are going to land up on “Shit Street”—as my father used to say.
Look to the End of Your Arm
We aren’t talking about retirees here; we are talking about working-age people currently in this economy who don’t even have the luxury of saving for their retirement because they are just trying to survive the day.
The overriding truth of this country has always been simple: you are entirely on your own. You have to figure out how to do it yourself. Nobody—absolutely nobody—is going to come and help you. You have to help yourself.
It is a basic truth, but it reminds me of a corporate executive I admired many years ago. He was a proper, heavyweight executive with academic excellence in engineering—not some fuzzy-wuzzy subject. He once said to me:
“If you ever need a helping hand, look at the end of your arm.”
It was a total truism, though I didn’t fully appreciate the weight of it back then. Yet, over the course of my life, it has proven itself true time and time again.
The point is this: get out there. Look around your immediate environment. See what you can offer, and then experiment. Run a trial, do a test—do whatever it takes. It’s like one expert says: even on Sunday evenings, you should be trolling job sites. Don’t just look for jobs within your own specific sector; look at other industries and other professions just to find out what demands are changing and what skills are transferable.
In an economy like this, self-reliance is no longer an option—it is the only strategy left.Financial Daily News is a wholly owned subsidiary of Idea Accelerator, specializing in producing ready-to-publish, high-quality financial and business content for websites, chambers of commerce, NGOs, community newspapers, international foreign newsfeeds and the environmental sector.
