Covid-19

LETTER TO THE EDITOR

Here are some hidden costs of the alcohol ban

Having walked the streets of the Cape Town CBD recently and seen boarded up windows, ‘To Let’ signs and well-loved bars and restaurants closed for good on every corner, I begin to wonder if we will make it out to the other side, says the writer. (Photo: Unsplash / Jose Fontano)

Running a small marketing consultancy, this is a snapshot of how the alcohol ban is having a devastating impact on our business. I now wonder if we’ll make it out to the other side after the Covid-19 pandemic is over.

As each day and week passes, the devastating implications of the Covid-19 lockdown and more recently, the ban on alcohol sales, on the livelihoods of people I know, are becoming more clear.  

This is not a letter about the horrifying statistics this ban is already inflicting on lives and livelihoods: 15-20% of wineries put out of business permanently; 120,000 jobs already lost, a predicted million more to come; 800 SMME and micro liquor manufacturers facing closure; and 90% of craft breweries in danger of closing

South African Breweries has said there are more than 250,000 livelihoods that are in their supply chain alone. When extrapolating this to the rest of the industry and the families that rely on these livelihoods – bartenders, restaurant owners, drivers, tavern employees, grape pickers, hops growers, bottlers – these numbers become evening more frightening. 

Added to that are the scary numbers and stats that demonstrate the impact this ban has had on our economy – the billions of rands lost to tax revenue, international sales, and the burgeoning illicit and black-market trade. Economists and analysts have provided these stats already.

This letter is also not one that talks to the negative impact that alcohol can have on some elements of society, or of the claims that drunken driving and violent crimes spiked radically when we moved to lockdown Level 3 (one would presume that this could also be because restrictions on the movement of people were lifted, but who are we to argue?).  

Whatever these negative impacts are, which I believe speak to much larger societal issues caused by decades of poverty, corruption and crime, this is not the time, during a pandemic, to make policy decisions that impact businesses’ licences to trade, at this scale. Particularly, these decisions should not be made without due process and stakeholder input – with those very same stakeholders who invest in some of the biggest initiatives to tackle irresponsible trading and consumption.

Instead, this letter talks to personal experience only, and gives a snapshot of some very real examples of how this ban is having a devastating impact on the lives and livelihoods of South Africans. 

I run a small marketing company that employs 12 people. We are small, but we have been slowly growing and building over our five years of operation. We like to think that we have a positive impact on the community within which we operate – we do pro bono work for charities and NGOs. We take on full-time paid interns because we believe in the importance of skills development in South Africa. We have a small team of happy people, who are paid well and treated well.

I am not sure where we are going with this. When we all first went into lockdown, most of us believed that it would be tough, but it was something that could (probably) be overcome. But having walked the streets of the Cape Town CBD recently and seen boarded-up windows, “To Let” signs and well-loved bars and restaurants closed for good on every corner, I begin to wonder if we will make it out to the other side.

Our last financial year was our best ever and last week, we won a prestigious industry award, voting us the best in the country in our category. In normal times, we would be buzzing with almost too much work to handle, and we were in the process of recruiting more staff. But since the Covid-19 pandemic hit in March 2020, one by one, the clients and projects have been slipping away and it has taken every bit of reserve we have to keep the business going and all staff employed. 

We have a number of alcohol clients and brands that we work with. Obviously, all events and activations in bars have been cancelled. That’s fine, we get that. But with the ban on the alcohol trade, so has everything else that we do for them. Graphic design for promotional pieces, social media management, digital banners for e-commerce. And with that goes the revenue that we pass on to the smaller suppliers that work with us on these projects – printers, photographers, videographers, caterers, media outlets… 

It’s not just us. A couple of weeks ago, another local event agency that had been around for eight years and with about 30 staff closed its doors for good. A majority of their clients were in the alcohol industry. They had also just had their best year ever. I spoke to another agency – one that manages in-store promotion for alcohol brands – and they are struggling to pay staff and suppliers this month. Next month will be worse. 

And the ramifications go wider. 

Another client is a small wine brand that donates money from every bottle sold on one range to anti-poaching projects in South Africa’s National Parks. To date, over R2-million has been donated in monthly increments. Over the past few months, there have been no donations because there have been no sales. These donations are used to train rangers, sponsor tracker dogs and buy essential equipment for those field rangers who are on the frontline of protecting our wildlife. These parks and the rangers that keep them going have been devastated by the impact of the pandemic – not just by the loss of income from tourists and spikes in poaching and other wildlife crimes, but also by all the small things – like the donations from these wine sales, which all add up to help them operate. 

Another client is a foundation that uses the millions it makes from dividends that it holds from its parent company – a South African alcohol manufacturer – to invest, mentor, provide and support SMMEs and social innovators. Over the years, more than 2,800 entrepreneurs and innovators have been supported; more than R260-million has been invested in grants, interest-free loans and business support; and as result, these businesses have seen 101% increase in turnover with more than 5,000 new jobs created.  

Millions of rands are spent this way each year by this foundation, but for the foreseeable future, it is likely that this will change, directly as an impact of the restrictions of sales created by the alcohol ban. This means hundreds of small businesses and entrepreneurs that would have benefited from this initiative in 2021 probably won’t – a devastating example of a long-term consequence of this seemingly short-term ban. 

I am not sure where we are going with this. When we all first went into lockdown, most of us believed that it would be tough, but it was something that could (probably) be overcome. But having walked the streets of the Cape Town CBD recently and seen boarded-up windows, “To Let” signs and well-loved bars and restaurants closed for good on every corner, I begin to wonder if we will make it out to the other side.

Should we not be doing everything we can to get any business that can operate safely to do so? DM

Emma King is founder and managing director of a PR consultancy in Cape Town, the Friday Street Club.

Gallery

"Information pertaining to Covid-19, vaccines, how to control the spread of the virus and potential treatments is ever-changing. Under the South African Disaster Management Act Regulation 11(5)(c) it is prohibited to publish information through any medium with the intention to deceive people on government measures to address COVID-19. We are therefore disabling the comment section on this article in order to protect both the commenting member and ourselves from potential liability. Should you have additional information that you think we should know, please email [email protected]"

Please peer review 3 community comments before your comment can be posted

X

This article is free to read.

Sign up for free or sign in to continue reading.

Unlike our competitors, we don’t force you to pay to read the news but we do need your email address to make your experience better.


Nearly there! Create a password to finish signing up with us:

Please enter your password or get a sign in link if you’ve forgotten

Open Sesame! Thanks for signing up.

We would like our readers to start paying for Daily Maverick...

…but we are not going to force you to. Over 10 million users come to us each month for the news. We have not put it behind a paywall because the truth should not be a luxury.

Instead we ask our readers who can afford to contribute, even a small amount each month, to do so.

If you appreciate it and want to see us keep going then please consider contributing whatever you can.

Support Daily Maverick→
Payment options

Every seed of hope will one day sprout.

South African citizens throughout the country are standing up for our human rights. Stay informed, connected and inspired by our weekly FREE Maverick Citizen newsletter.