The recent torrential rains that hit Accra, Tema, Keta, and other parts of Ghana on June 29th have left a trail of destruction, loss of lives, and crippled businesses. For many MSMEs, these floods are an existential threat. The recurring cycle of disruption, loss, and laborious recovery has become a grueling pattern for businesses in the southern part of Ghana. This is not just a matter of reacting to natural disasters, but also navigating the labyrinth of shocks that affect businesses, including currency fluctuations, high borrowing costs, and global events like the COVID-19 pandemic.

The average Ghanaian entrepreneur navigates a world of uncertainty, and building resilience is no longer an option, but an absolute necessity for survival. True resilience is not about preventing every problem, but about developing the agility to anticipate changes, develop plans, test these plans, and allocate resources in ways that enable success irrespective of the circumstances. For an MSME, resilience is the ability to cope with challenges and suffer minimal setbacks.

A comprehensive strategy that covers six foundational areas is essential: financial buffers, risk transfer, organisational agility, management systems, technology, and the human element. For a Ghanaian MSME, resilience begins with liquidity. Building a cash reserve is essential, especially for those who operate hand-to-mouth. Even a disciplined monthly saving towards a contingency fund can be the difference between closing permanently and surviving a month of low revenue.

Insurance must be re-envisioned as a critical tool for risk transfer. Policies covering fire, flood, and business interruption provide a pathway to recovery that does not rely on high-interest loans or family and friends' charity. Adopting a systematic approach to business continuity is also crucial. This involves protecting people, premises, processes, technology, communication, and having community ties.

According to a report, the average cost of repairing a business affected by flooding is GHS 50,000 to GHS 100,000 (approximately USD 6,600 to USD 13,200). This amount can be devastating for MSMEs, which often struggle to access capital and funding. The floods have also exposed the need for businesses to have a disaster recovery plan in place. By building resilience, MSMEs can transform their stance from vulnerable to impervious, and maintain operations, trade through the disruption, and emerge with their continuity intact.

The solution lies in shifting our focus from passive reaction to proactive business resilience. By embedding robust management systems, disaster recovery protocols, and financial safeguards into the core of our operations, businesses can transform their stance from vulnerable to impervious. This requires a mindset shift from reacting to unforeseen circumstances to preparing for them and identifying new opportunities even in the midst of a crisis.

"We need to move from a reactive approach to a proactive one. We need to build resilience into our businesses, so that when the next flood comes, we can weather the storm and continue operating."

  • Unknown

The floods have highlighted the need for MSMEs to take proactive steps to develop resilience strategies. This includes building financial buffers, transferring risk, and adopting a systematic approach to business continuity. By doing so, businesses can maintain operations, trade through the disruption, and emerge with their continuity intact. It's time for Ghana's MSMEs to take the bull by the horns and build resilience into their operations.