When you read through the business technology news there is not much celebrating being had. I think it was obvious and common knowledge that most businesses are still struggling in survivor mode since the lockdown period that started in March 2020. 54 months later and companies are still in a financial mess with many realistically having no chance to recover.
Next week COSATU one of the bigger trade unions has a planned strike ironically aimed at asking the government to create more jobs yet we know this will only help make the situation worse. The economy is struggling and somehow someone thought it would be a good idea to keep those working away from work. They have no idea how fragile many of the companies are and a day or two lost due to strike action could be the last straw.
I know there are a few major companies that are technically insolvent when the assets you own do not cover the outstanding debt. Cell C which was once part of the big 3 cell phone providers along with Vodacom and MTN. They are inching their way out of trouble but cannot afford a repeat of last year which saw their debt outweigh their assets by R4 billion. They lost over 4.6 million subscribers in a 12 month period and will have 1/10th of the workforce they once had. 2600 employees down to under 300 and we all know once you lose the skills you are basically done for. It is amazing how many CEO's get these positions because it is easy if you are a leading player, but you need to earn your salary when things turn and they now look incompetent.
The Post Office run as an SEO with 7000 staff is as good as gone with debt owing 3 x more than the value of it's assets and there is no hope. Multichoice DSTV I mentioned in my earlier post tis evening actually has a deal on the table with CANAL the French broadcaster and if that fails they have a negative balance sheet in the billons. The downward trend is so steep I do think that deal is now off the table because the value that was there has since been made much less. SABC another SEO is the South Africa Broadcasting Corporation who relied on tv licenses of which they have lost 86% due to people refusing to pay. Note 2 of the big 4 are government run businesses without a hope of ever bouncing back. SABC's biggest problem is their wage bill due to having ghost workers who do not exist which is another form of corruption. 2000 more workers will be lost here if they even have that number due to fake staff.
South African Airways is not on this list ad don't see how they are being left out and their days must be numbered. I was at Johannesburg and Durban airport over the weekend and I did not see one of their 8 planes. It is amazing how some of these businesses that had such a big monopoly failed due to poor management or should I say no management.
Pick 'n Pay s a large food retailer in SA and they were insolvent, but have been temporarily saved by some funding. They will close or convert over 100 stores which means even more job losses. This retailer is the equivalent of a Walmart or a Tesco to give you an idea. If you cannot make money as a top 2 food retailer then you should not be in business.
I was reading a report which has a list of 1029 businesses that have closed since January the first this year. There are many in business rescue that are household names which hits home that you are never too big to fail.