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Are you looking after your employees?

Are you looking after your employees?

South Africa’s small business (SME - small and medium size enterprises) sector is sizeable and growing year on year. We now have more than 2 million recognised small businesses, that contribute nearly 50% of South Africa’s GDP, and employ up to 60% of our total workforce (Stats SA 2015).

The role and growing influence of SME’s requires a unique take on employee benefits. Firstly: the relationship between SME owners and employees tends to be more personal than in a corporate. Personal loyalty and close proximity make both the SME owner and their employees mutually vulnerable.

A survey* showed that the biggest challenges to business owners were

  1. cost and
  2. perceived administration burden.

Business owners also didn’t know much about various benefits and options, and some lacked incentive to offer employee benefits. The research also showed that the percentage of SMEs offering some type of group employee benefits rose significantly as revenue and staff numbers increased. “This isn’t a surprising outcome as at the start of a business, owners are primarily concerned about survival. The challenge is to convince SME decision makers that it is possible to implement employee benefits in the early stages of their lifecycle. It is imperative that these perceived barriers be removed if we are to address the savings crisis in South Africa,” (Doug Clothier, GM of SME Segment at Old Mutual).

How SMEs can also benefit

Despite all the challenges, the research found that drivers that push SMEs to provide employee benefits include having the cash flow to afford it, owner’s commitment to social responsibility, external pressure (such as legislation or unions) and the growth of the business. The need to attract and retain skilled staff was also one of the biggest drivers for business owners to offer benefits. Many SME decision makers (64%) and SME staff (69%) believe that employee benefits offered by a business play an important part in attracting employees. Often businesses assume that their employees would take necessary personal insurance measures, but in reality many people don’t.

Benefits provided to staff increase the value they derive from working for an employer, making the business a more attractive place to work. But these benefits can also strengthen the commitment of staff to their employer as they feel more valued within the business.

“As an employer, by covering your employees you’re not just helping their family through financial strain if something happens, you’re essentially covering your business too. Businesses often feel obligated to pay the families and the financial strain to the business can be significant, without a life insurance product in place,” says Anthony Miller, Simply Financial Services CEO.

Simply has introduced a Group life cover combo specially designed for SME’s. These comprise life, disability and funeral benefits - specially designed for the employees of small to medium sized businesses in South Africa. See more about the product here -


“Retaining top calibre staff is an increasing challenge for our medium sized technology company, with larger corporates able to offer far more attractive benefits. Traditionally we’ve found these benefits a significant cost to retroactively add to our income statement, and in addition to already competitive salaries. Fortunately we were recently introduced to Simply who’s digital online offering has enabled us to not only offer great benefits at significantly better rates – but also give us and our staff piece of mind with backing from a trusted powerhouse in Old Mutual. The entire onboarding process is simple and painless - no heavy admin work and medicals - a breath of fresh air from the traditional products and processes we have looked at in the past. Deciding the benefit levels and respective costs was all online, and as simple as moving some sliders up and down. Thereafter it took the HR department a matter of minutes to sign everyone up, each employee received a wonderful welcome SMS asking them to completed their beneficiaries information on their cell phones…and we were done! An unparalleled service and offering. Thank you Simply.”

*(2015) Old Mutual SME Employee Benefits Monitor

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The underwriter of this policy is Old Mutual Alternative Risk Transfer Limited (OMART) a registered long-term insurer.

Copyright 2020 Simply Financial Services (Pty) Ltd. All rights reserved. Simply is a registered financial services provider (FSP: 47146).