Crime Hit Small Businesses Face Higher Insurance Costs

October 14 - While crime against banks, post offices and big businesses has decreased dramatically in recent months around South Africa, the police say that robbers and organized crime syndicates have simply shifted their attention elsewhere - the small businesses, usually in isolated regions, as an example.

The spate of attacks against small businesses lately has certainly taken a toll, as these firms struggle to pay for the more expensive security measures demanded by their insurance companies, in addition to their loss of business that comes with wave after wave of criminal attacks.

Insurance companies are not willing to take the risk on these small businesses if they are not properly protected and thus make demands on the firms to install more expensive security devices, construct higher gates and employ security guards.

Most of these small businesses are struggling as it is, as their regular clients usually stay away after an armed robbery. The need to increase their expenses for insurance purposes, just when they need every cent they have in order to keep afloat, has meant a strong blow to many of these small businesses who simply cannot afford to keep open any longer.

The Chief Executive Officer of Business Against Crime, Simphiwe Nzimande said: "Crime has inhibited growth. Businesses that have been targeted by criminals are not going to expand and create employment. There is a trend away from direct fixed investment into businesses, which is a big problem."

An economist at the South African Chamber of Commerce, Bill Lacey concluded: "You simply cannot operate a business in South Africa without some means of protection, whether it's guards, TV systems or a sophisticated high-tech system."