Financial inferences of COVID-19 on the hospitality industry in Sedibeng municipality

Abstract

The COVID-19 pandemic has severely disrupted South Africa’s hospitality sector and financially strained the industry’s small and medium enterprises (SMEs). The purpose of this study is to critically examine the financial implications of COVID-19 on the economic challenges faced by SMEs in the hospitality industry within Sedibeng District Municipality, South Africa. The investigation focused on whether the pandemic-induced financial challenges adversely affected SME revenue and overall profitability, leading to sustainability issues. An exploratory research approach was employed, utilizing descriptive statistics. Results indicate that reduced capacity to conduct business during the pandemic decreased employment capabilities within the hospitality sector, resulting in layoffs. The COVID-19 pandemic had operational and financial ramifications that negatively impacted sales and profitability. These findings highlight the urgent need for adaptive financial strategies and policy support to ensure the sector’s long-term viability during such crises. Furthermore, the study recommends future research to explore sector-specific recovery strategies, thereby enriching the discourse on SME resilience in times of crisis.