IMPACT OF COVID-19 ON THE KENYAN ECONOMY: A CASE STUDY OF MICRO, SMALL AND MEDIUM ENTERPRISES (MSMEs) AT VIWANDANI, NAIROBI.

Abstract

Globally, businesses have been brought to a standstill with unparalleled and unanticipated impact on economies as well as livelihoods by the ongoing pandemic. Major victims of the COVID-19 outbreak are micro, small, and medium-sized enterprises (MSMEs). This health crisis has halted operations across all industries and heightened uncertainties amongst societies based on the recurring control measures quarantines, travel bans, border closures, a worst-case scenario in Kenya is foreseen calling for a more integrated approach to effective recovery. Although the sheer magnitude of the shock and the unfolding of the pandemic make it especially challenging to foresee the economic impact, the direct possibility of a recession has become concrete. In order to adapt to the change in the new environment, MSMEs are consistently reviewing their business models to survive and go through past the pandemic. This research investigates how MSMEs operating in vehicle service industries have been coping with the disruptions caused by the COVID-19 pandemic. This research aims to gain insights into which transformation drivers MSMEs have focused on and which adaptation models they have selected as a means to respond to the disruption as well as create sustainable business models. This research employed a case study research design. Data was collected through the help of online administered questionnaires, interviews and observations while observing the guidelines from the MOH and the WHO. The study employed simple random sampling design to survey parameters related to MSMEs in Viwandani area Makandara constituency. The study used both qualitative and quantitative methods of data analysis to analyze the findings. The results indicate that most of the participating Motor vehicle MSMEs have been severely affected and they are facing several issues such as financial challenges, decreased demand, reduced revenue and profits which has led to reduced employment rates and staff retention among other severe impacts. In addition, 100% of the participating MSMEs reported not to have been prepared to handle the impacts of a pandemic because this type of a global pandemic had not been experienced before. Further, all participants reported to have reduced operations or review their business models in one way or the other as a result of the pandemic. In concluding, this research has provided insightful theoretical and practical implications concerning the impact of COVID-19 on MSMEs.