Opportunities for SMEs in underexplored sectors

Out of crisis comes opportunity. COVID-19 has dealt the South African economy a severe blow, but it has also radically reshaped our world and opened up opportunities for those equipped to take them.

Here are opportunities for SMEs in underexplored sectors

The businesses that will survive – and even thrive – in a post-COVID-19 world are those that can remain alert for gaps in the market, and ready to take advantage of emerging consumer demands and new ways of working.

Even before the pandemic, there were sectors of the South African economy that were underexplored by Small and Medium Enterprises (SMEs), and some of those gaps have only grown.

I will examine several sectors that might be ripe for entrepreneurs and small business owners who are looking for new opportunities in a constrained economy.


There are pockets of opportunity if you find the right niche. The mass import of COVID-related PPE showed the potential for local manufacture of medical equipment, while technology is moving fast enough that the sub-sector is not at capacity. There is also opportunity in items tailored to the local market, such as clothing for babies and infants – particularly clothing that goes beyond the every day to celebrate special occasions. People want the best for their children, and they’re willing to pay for it.

The same can be said of pet owners. There have been some breakout success stories in local dog-food manufacturing, but there is still potential for locally produced healthy, ethically manufactured pet food. 


The world of education has changed, perhaps irrevocably. Many institutions are unlikely to go back to an entirely physical learning model, instead of embracing some sort of hybrid between online and physical learning. There are numerous opportunities for the savvy entrepreneur in this space. For example, parents feel as though they lack control of their kids’ online learning. Easy-to-use, helpful learning-management tools are unlikely to go out of fashion.

Delivery services

An easy win might be in the provision of local delivery services. Grocery deliveries are still thriving, even in Alert Level 1. And there is room for maturation in the segment. A value-adding service in this area is personalised or bespoke shopping, encompassing recommendations, and curated baskets. 

There are also under-targeted market segments, including elderly and vulnerable people, especially given the uncertainty in terms of how long COVID-19 will be with us.

Renewable Energy

The government has announced long-term plans to further opening the energy grid to renewable energy, and there will be increased opportunities in the construction and management of renewable energy facilities, whether on a commercial, residential or industrial scale. 

With more people than ever working from home, there is an increased demand to make homes more sustainable (especially solar-powered), and to reduce the risk of inconsistent electricity supply. In a similar vein, the provision of backup water supply (for example, storage tanks that harvest rainwater) is also becoming increasingly important for households and businesses alike.

SMEs that can pivot towards the places where there is the greatest societal need may just find the formula for keeping their business going.

This article was written by Andiswa Bata, FNB Business Regional Head – Gauteng South West.

Featured image: Andiswa Bata, FNB Business Regional Head – Gauteng South West (Supplied)



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