My name is Mohammad Yattara, from Dire, region of Timbuktu in northern Mali. Since 2012 this part of my country has been paralyzed by a Tuareg rebellion (an ethnic group from northern Mali), followed by the invasion of the Islamists of Aqmi, which brought me to the capital in search of a better life.
I was providing for my family needs through agriculture, which is the main activity of the area, but with insecurity it is no longer possible to cultivate and those who ventured to do business and other activities are very often looted by the rebels and by the Islamists under the pretext of an effort to participate in the struggle for the liberation of the «AZAWAD». So, I could not stay because there was no work for me there.
I decided to go to Bamako because when I was younger, I had already been there before to look for money and I stayed connected with my former bosses but also with some family members who have lived there for a long time. As I could no longer cultivate my land, this was my only option to survive: to come to Bamako and try to open a store to provide for my family.
When I arrived in difficult conditions without money, I first started to work in an uncle’s store, this work allowed me to make some money and send money to the village for my family. I often visited some of my old acquaintances to talk to them about my store project and to see how they could support me, since it was impossible for me to get a loan from the bank because of the conditions (the interest to be paid on the credit) and the religious stereotypes I faced. After few months, my store was born with the support in cash and in kind from some people from my village. Everything was going well because even if I was far from my family, I was able to take care of them and to save money for emergencies, for health expenses and for my children’s education even if the schools were closed.
Recently my life had another turn with the advent of the corona virus (COVID-19), and in this time of the pandemic, the government decreed certain preventive measures such as compliance with lockdowns, curfew and closure of air and land borders.
This strongly influenced my business activity, given the reduced working hours, but mainly due to the closure of the borders as everything I sell is imported, so the closing of the borders has not only led to a price increase but also to difficulties in supplying my shop with raw materials.
Within this context, I had the visit of Sékou TRAORE (L-IFT Field Researcher) in early January 2021, who came to talk to me about the “corner shop project”, which consisted of collecting weekly data on the activities of my store, but also asked me questions about the situation of my life, of my store. At first, I thought it was someone who wanted to get into my economic situation to cause harm and after our discussions I accepted with reservations.
At the beginning it was difficult. Not only did I have reservations, it took my time and I gained nothing. I also did not have the culture to speak openly about my economic situation especially to a stranger. Many shopkeepers in my situation have been victims of scams and robbery and there is also the fact that I had to now keep track of my daily savings, expenses and other things. The difficulty was related to the fact that I used to do my accounts only quarterly. For that, I received a notebook in which I could note everything and that facilitated the work both for Sékou and myself.
But I must admit that the application “FINBIT”, allowed me to be really organized and to pay attention to certain expenses, to optimize my savings and to set goals. It is an innovative and useful project for other shopkeepers. We thank L-IFT for the data collection and we ask L-IFT for training in business to increase our skills, in financing, to help us implement strategies to increase our income and meet our expenses. Because we must recognize that our situation is, in addition to the pandemic, we live in an unstable political situation that manifests itself in repeated coups d’état, rebellion and terrorism.
The Corner shop diaries project is collecting data in Africa and Asia from 150 small businesses such as that of Mohammad. The data we are gaining is helping us to understand how these small businesses work, how they have been affected by the Covid-19 pandemic and how they can recover from the effects of the pandemic.
In Mali, we have been collecting data from 18 such small businesses from January 2021 and are getting useful insights on the situation facing these small businesses during this Covid-19 pandemic. In these key insights that are shared below and supported by actual data collected, we explore how incomes, expenses, loans, and savings have been changing for Mohammad and for the rest of the sample in Mali during these complex times.
1. Income fluctuations
Monthly income totals reflect the effects of Covid-19 on the businesses in Mali. With the increase in Covid-19 infections in Mali in early January, measures including curfews and closure of borders were put in place and had a negative impact on business. Supply chains were disrupted on one end and on the other, curfews reduced the amount of trading hours. For Mohammad, he lost a lot of possible income as he would have to close early while the cost of supplies increased and was difficult because of the closure of borders.
“COVID at the beginning of the year has really affected my life in a negative way because there was no support measure for shopkeepers and household expenses remain the same, we have to face it, we have to pay rent, food, health care and other accommodations.”
As can be seen on the graphs, February and March were difficult months for the businesses as the second wave of Covid-19 was taking its toll. In April, business began to surge as vaccinations were now being implemented and Covid-19 restrictions were beginning to get relaxed so there was more activity for the businesses.
For Mohammad, his business shows many fluctuations as the changes on Covid-19 restrictions were significant as his business was operating in a neighbourhood that had the earliest infections and was considered a hotspot. However, in May, his neighbourhood had also started to relax the Covid-19 restrictions and he saw a spike in his income levels.
Unfortunately, in June, with the increase in the price of certain products such as oil and cereals which are the main products that Mohammad sells, he was unable to adequately supply his shop and this has greatly reduced his income.
2. Expense fluctuations
Expenses also reflect the inconsistency and disruption caused by Covid-19.
In the graphs above, we see the business expenses faced by the entire sample and that of Mohammad. For Mohammad, we can see his business expenses growing over the months after a tough start to the year caused by Covid-19. It appears that in February and March Mohammad has not spent much on buying new stock and his sales at that period were coming from selling old stock and he did not restock because goods were not readily available due to closed borders and high costs at the time. As the restrictions were relaxed, he was able to source more stock for his business and his expenses therefore grew during the April to May period. We also saw his income growing after he had made the additional stock purchases in April. On his income graph it can be seen that May was his highest earning month.
In terms of some of the specific expenses we have reviewed in the graphs below – health and toiletries expenses, food at home expenses, and clothing and shoes expenses – we can see higher health and toiletries expenses in February at the height of the pandemic where shops had to make sure they have adequate sanitisers and hand washing tools in line with the Covid-19 regulations.
The expenses then begin to slowly decrease over the months with the Covid-19 situation stabilising. Expenditures on ‘food at home’ take an opposite trend where they are lower at the height of the second wave where households had to save as much as they could in anticipation of the unpredictable times ahead because of Covid-19. Clothing and shoes expenses are only seen in February and June with minimal amounts as these would not be a priority during a pandemic.
These trends give us an idea of the sort of priorities that take hold during a pandemic and how a pandemic can influence the spending patterns of businesses and individual households.
3. Access to finance is a challenge
Just over half of the respondents (10 of the 18 respondents) have so far taken loans including Mohammad. Interestingly, 8 of the respondents have taken loans in the form of stock from suppliers to be paid later while only 2 have loans from other places (one from family and one from another local shop keeper). This shows that supply chain finance is maintained during the pandemic and only a few informal alternatives have emerged. There are no other loans that have been taken from institutions such as banks, micro-finance institutions, mobile money wallets, etc. What type of loans this group of shop keepers used to take, before Covid-19 is something we want to explore through a special survey.
His first loan recorded was on 31 January and he began to service it even during the pandemic where he started making repayments on 7 February. In March and April, he missed making any payments. This was at a time during the strict lockdowns and also in April where his income had fallen. With a rise in income in May he was able to start making payments again.
Mohammad is one of the people using supply chain finance. Mohammad received in total 300,000 XOF in loans from suppliers and he has managed to pay back 230,000 XOF and only remains with a current debt of 70,000 XOF. His business is therefore able to keep going because of these types of credit facilities from suppliers and he is committed to make steady repayments although during this pandemic, his payments have been affected by the inconsistent income.
4. Savings, Covid-19 trends, and Income fluctuations are correlated
Savings deposited monthly totals show an interesting trend in relation to Covid-19. From February, we see that savings deposits totals for both Mohammad and the larger Mali sample take a dip and only start to increase again when the Covid-19 situation stabilises and incomes are better. They go down again in June because of the decrease in income in June. We see very few savings withdrawals happening. Mohammad himself only made one withdrawal in April of 30,000 XOF which resulted in the spike in the Savings withdrawals totals for the entire sample in the month of April.
The volatility caused by Covid-19 has been severe but local small businesses have been able to withstand the pressure and have shown incredible resilience. Through supplier credit facilities, careful management of expenses, savings, and loans, people such as Mohammad continue to supply their communities with daily provisions and still look forward to better consistency and profits within their businesses. They still have many hopes of growing their businesses through getting knowledge and finance. The corner shop diaries project through its detailed financial diaries methodology, reveals all these different insights into the pandemic and into how small community businesses operate.