More than two-thirds of SA SMEs plan price hikes amid rising costs

A CONCERNING trend has emerged within South Africa's small business sector as a new report revealed that 67% of small and medium-sized enterprises (SMEs) plan to raise prices by up to 10% over the next six months.

- ASHLEY LECHMAN

AS SOUTH Africa's small businesses prepare for a challenging year ahead, their responses to rising operational costs may not only shape their future but also the broader economic landscape of the nation. Stakeholders now face a crucial moment to act decisively to steer SMEs towards sustainability and growth. FREEPIK

This shift is largely a response to relentless operational cost pressures, posing significant challenges for the sustainability of these businesses in an increasingly volatile economic environment. The latest Small Business Growth Index (SBGI) report, based on a comprehensive survey of more than 2,000 SMEs, highlights the precarious state of the sector, indicating that fewer than four out of ten of these businesses believe they can withstand the current pressures for more than a year without external support.

The SBGI was launched earlier this year through a collaborative effort between Absa Business Banking, the South African Chamber of Commerce and Industry (SACCI), and the Bureau of Market Research (BMR) at Unisa, establishing it as the country’s inaugural barometer for assessing the conditions affecting small businesses.

The overall SBGI score for the latter half of 2025 stands at 51.50 points, on a scale of 0 to 100.

This places the sector within the “Vulnerable Zone’, still reflecting fragile stability and only a modest improvement from the previous half, which recorded 50.08 points.