The Effect of Load Shedding on the Performance of Small-Scale Restaurants in Mthatha, South Africa – An Assessment

The effect of Load Shedding on the performance of Small-scale restaurants in Mthatha, South Africa – An assessment

Lelethu Mantangayi, Obert Matarirano & Cuthbert Muzaa

Issue: Vol. 7 No.2 2026 Article 9 pp. 536 – 554
DOI: https://doi.org/10.38159/ehass.2026729| Published online 31st March 2026

56 Downloads

DOWNLOAD PDF

ABSTRACT

Small enterprises in South Africa play a critical role in job creation, driving economic growth and addressing the historical economic injustices. However, the scheduled power outages implemented in South Africa due to electricity supply constraints have placed a significant operational burden on these enterprises, particularly within the restaurant sector, which is highly dependent on consistent electricity supply. The study examined the impact of load shedding on the operational and financial performance of small-scale restaurants in Mthatha, South Africa. A quantitative, explanatory research design was used. Data were collected through a survey, using a self-administered questionnaire distributed to 53 small-scale restaurants. Fifty-one valid responses were received and analysed with descriptive and inferential statistics using Microsoft Excel and SmartPLS4 statistical software. The results revealed that load shedding has a negative impact on both the profitability and productivity of small-scale restaurants. However, these effects were found to be statistically insignificant. Given that South Africa’s electricity challenge does not seem to have a near-future solution, it is crucial to understand its impact on small enterprises. Although the effects were not statistically significant, the negative effects warrant the need for long-term, sustainable energy alternatives, tailored to the needs of small enterprises in electricity-dependent sectors, such as hospitality. State the contribution of this study to scholarship.

Keywords: Load Shedding, Performance, Productivity, Profitability, Small-Scale Restaurants

BIBLIOGRAPHY

Abeberese, Ama Baafra, Charles Godfred Ackah, and Patrick Opoku Asuming. “Productivity Losses and Firm Responses to Electricity Shortages: Evidence from Ghana.” The World Bank Economic Review 35, no. 1 (2021): 1–18.

Adonis, Vusi. “Load Shedding: Permanent Stage 2 or Not, Small Businesses Are Dying.” South Africa, Web, 2023.

Ajibola, Akinyemi Alao, Gbemi Moses Sodeinde, Timothy Ayomitunde Aderemi, and Modupe Ololade Yusuf. “Impact of Electricity Supply on the Performance of Small and Medium-Scale Enterprises (SMEs) in Nigeria: A Case Study.” Economic Insights-Trends & Challenges, no. 4 (2021).

Aliahmadi, Saeid. “Does CEO Power Moderate the Link between Labor Productivity and Financial Performance: Agency Theory or Stewardship Theory.” Asian Journal of Accounting Research 9, no. 1 (2024): 47–56.

Allcott, Hunt, Allan Collard-Wexler, and Stephen D O’Connell. “How Do Electricity Shortages Affect Industry? Evidence from India.” American Economic Review 106, no. 3 (2016): 587–624.

Apuke, Oberiri Destiny. “Quantitative Research Methods a Synopsis Approach.” Arabian Journal of Business and Management Review (Kuwait Chapter) 6, no. 11 (2017): 40–47.

Arnold, Christopher. “The Foundation for Economies Worldwide Is Small Business.” South Africa, Web, November 11, 2019. https://www.ifac.org/knowledge-gateway.

Ateba, Benedict B, Johannes J Prinsloo, and Remigiusz Gawlik. “The Significance of Electricity Supply Sustainability to Industrial Growth in South Africa.” Energy Reports 5 (2019): 1324–38.

Ballim, Faeeza. “Eskom and the Electricity Act 42 of 1922.” South African Historical Journal 74, no. 4 (2022): 680–82.

Banda, Gerald, Garry Simukoko, and Tailoka Frank Patson. “Effect of Load Shedding on Small Scale Entrepreneurs: A Case of Kitwe District of Zambia.” Economy 7, no. 2 (2020): 104–9.

Banderker, S I. “The Perceived Psychosocial and Economic Impact of Load-Shedding on Employees in Selected Small Micro Medium Enterprises.” Cham: Springer International Publishing, 2022.

Barney, Jay. “Firm Resources and Sustained Competitive Advantage.” Journal of Management 17, no. 1 (1991): 99–120.

Barney, Jay B, and Delwyn N Clark. Resource-Based Theory. Oxford: Oxford University Press, 2007. https://doi.org/10.1093/oso/9780199277681.001.0001.

Bernard, Bawuah, and Dinah Koranteng Anaman. “Power Outages in Ghana: Did They Have an Effect on the Financial Performance of Listed Firms?” International Journal of Management Excellence (ISSN: 2292-1648) 10, no. 3 (2018): 1434–39.

Bhagwan, J., and H. Narsee. “ Investigating the Impact of Load Shedding on Small Businesses in South Africa: An Exploratory Study.”Journal of Economics 8(2017):43–53.

Blimpo, Moussa P., and Malcolm Cosgrove-Davies. “ Electricity Access in Sub-Saharan Africa: Uptake, Reliability, and Complementary Factors for Economic Impact.” World Bank Publications, 2019.

Chimaihe, A. Venon, Miston. Mapuranga, and Rirchard Chinomona. “The Influence of Training and Development Dimensions on Employees’ Performance at an Institution of Higher Learning in South Africa.” Business & Social Science Journal (BSSJ) 6, no. 2 (2021): 21–44.

Creswell, John W, and Vicki L Plano Clark. Designing and Conducting Mixed Methods Research. Sage publications, 2017.

Damnjanovic, Aleksandar M, Vladimir Dimitrijevic, Sandra Nesic, Miroslav Miskic, Gordana Mrdak, and Sinisa M Arsic. “Risk Influence of Employee Productivity on Business Failure: Evidence Found in Serbian SMEs.” Sustainability 15, no. 6 (2023): 4705.

Delice, Ali. “The Sampling Issues in Quantitative Research.” Educational Sciences: Theory and Practice 10, no. 4 (2010): 2001–18.

Ef Ii, Pami-Pami. “The Impact of Electricity Insecurity on the Performance of Small and Medium Size Enterprises-The Case of Cameroon,” 2021.

eKomani Blog. “The Impact of Loadshedding on Restaurants and Negative Customer Reviews: A Case Review of Ons Huisie,” January 15, 2022. https://blog.ekomi.com/archive/the-impact-of-loadshedding-on-restaurants-and-negative-customer-reviews-a-case-review-of-ons-huisie/.

Fakhrurrazi, Fakhrurrazi, and Muhammad Isa Indrawan. “The Influence of Work Motivation and Work Discipline on Employee Performance Mediated by Organizational Commitment at Teungku Fakinah General Hospital Banda Aceh City.” International Journal of Social Science, Education, Communication and Economics 2, no. 2 (2023): 943–58.

Fakih, Ali, Pascal Ghazalian, and Nancy Ghazzawi. “The Effects of Power Outages on the Performance of Manufacturing Firms in the MENA Region.” Review of Middle East Economics and Finance 16, no. 3 (2020): 20200011.

Fiawoo, Evitta Ersinam. “Assessing the Effects of Load Shedding (Dumsor) on SMEs and the Coping Strategies Used to Survive Load Shedding in Madina, Accra,” 2016.

Fjose, Sveinung, Leo A Grünfeld, and Chris Green SQW. “Identifying SME Roles and Obstacles to SME Growth.” MENON-Publication No 14 (2010).

Grainger, Corbett A, and Fan Zhang. “Electricity Shortages and Manufacturing Productivity in Pakistan.” Energy Policy 132 (2019): 1000–1008.

Habanabakize, Thomas, and Zandri Dickason-Koekemoer. “Assessing the Significance of Electricity Supply, Inflation and Fuel Price on Food and Beverage Production and Sales in the Manufacturing Sector.” African Journal of Business and Economic Research 16,no.4 (2021): 137.

Holdford, David A. “Resource-Based Theory of Competitive Advantage – a Framework for Pharmacy Practice Innovation Research.” Pharmacy Practice 16, no. 3 (September 30, 2018): 1351. https://doi.org/10.18549/PharmPract.2018.03.1351.

Kadam, D. M., and R. K. Shah. “ An Overview of Refrigeration and Its Importance in Food Preservation.” Journal of Food Science and Technology 55, no. 2 (2018): 387–95.

Katlego, Keeletse, and Gan Yin. “The Effects of Loadshedding on Small and Medium South African Enterprises Using Statistical Analysis.” International Journal for Research in Applied Science and Engineering Technology 12, no. 10 (2024): 238–51.

Kepadisa, Keeletse Katlego, and Gan Yin. “The Effects of Loadshedding on Small and Medium South African Enterprises Using Statistical Analysis.” International Journal for Research in Applied Science and Engineering Technology 12, no. 10 (October 31, 2024): 238–51. https://doi.org/10.22214/ijraset.2024.64493.

Khan, Shahid, and Mumlikat Begum. “Social Impact of Energy Crisis on Small Scale Industrial Workers in District Swat.” Pakistan Journal of Society, Education and Language (PJSEL) 6, no. 1 (2020): 81–93.

Kibirige, I., and Benon Basheka. “ Effects of Load Shedding on Business Operations in Kampala, Uganda.” International Journal of Management and Commerce Innovations 5, no. 1 (2017).

Kohler, Charlotte. “ How Load-Shedding Destroys Small Businesses.” Africa Web, November 15, 2022. https://www.nichemarket.co.za/blog/nichemarket-advice/load-shedding-kills-smesouth-africa.

Kor, Yasemin Y, and Joseph T Mahoney. “Edith Penrose’s (1959) Contributions to the Resource‐based View of Strategic Management.” Journal of Management Studies 41, no. 1 (2004): 183–91.

Ledermann, Thomas, and David A Kenny. “Analyzing Dyadic Data with Multilevel Modeling versus Structural Equation Modeling: A Tale of Two Methods.” Journal of Family Psychology 31, no. 4 (2017): 442.

Li, Cheng-Hsien. “Confirmatory Factor Analysis with Ordinal Data: Comparing Robust Maximum Likelihood and Diagonally Weighted Least Squares.” Behavior Research Methods 48, no. 3 (2016): 936–49.

Lubasi, Nelson. “Impact of Energy Distribution on Small and Medium Enterprise (A Case Study of Chongwe District),” 2020.

Mabunda, Mkateko Vivian, Ricky Munyaradzi Mukonza, and Lufuno Robert Mudzanani. “The Effects of Loadshedding on Small and Medium Enterprises in the Collins Chabane Local Municipality.” Journal of Innovation and Entrepreneurship 12, no. 1 (2023): 57.

Mabuza, Semanga, and M Maphosa. “R. The Impact of Load Shedding on the Performance of Manufacturing SMES in South Africa.” In Proceedings of the 10th Biennial Academy of World Business, Marketing and Management Development Conference, Perth, Australia, 25–28, 2023.

Mahomed, I., and M. Taute. “Load Shedding’s Impact on Restaurants in South Africa.” African Journal of Hospitality, Tourism and Leisure 8, no. 1 (2019): 1–9.

Makgopa, S, and Z Mpetsheni. “Exploring the Impact of Load-Shedding on SMME’s in Nelson Mandela Bay Municipality.” Academy of Entrepreneurship Journal 28, no. 03 (2022): 1–10.

Makhdoom, Tayyaba Rafique, Muhammad Nawaz, and Nabi Bakhsh Narejo. “Effects of Loadshedding on Retail Business: A Glimpse From Hyderabad, Pakistan.” Grassroots 51, no. 1 (2017).

Mlobothi, Lusanda. “The Impact of Direct Marketing on Consumer Buying Decisions in Mthatha’s Cosmetic Industry.” Walter Sisulu University, 2022.

Mupani, Honest. “Environmental Factors, Employee-Resourcing Strategies And Performance Of Small Restaurant Businesses In South Africa: A Structural Equation Modelling Approach.” Central University of Technology, 2019.

Mutambo, Humphrey, Sidney Kawimbe, Charity Meki-Kombe, and Austin Mwange. “Impact of Electricity Load Shedding on Operations of Small-Scale Enterprises in Selected Developing Countries: A Review of Literature,” 2023.

Ndabeni-Abrahams, A. “Power Cuts Killing Small Businesses.” South Africa Web, June 19, 2022. https://www.enca.com/news/ndabeni.

Ngenda, Lubinda. “Project Report Title: The Impact of Load Shedding on Manufacturing Industries in LUSAKA, Zambia,” 2020.

Njiraini, Winfred. “Effects of Electric Power Outage Dynamics on the Performance of Manufacturing Firms in Kenya.” University of Nairobi, 2021.

Nyanzu, Frederick, and Josephine Adarkwah. “Effect of Power Supply on the Performance of Small and Medium Size Enterprises: A Comparative Analysis between SMEs in Tema and the Northern Part of Ghana,” 2016.

Olajuyin, Olayide F, and Stephen Mago. “Effects of Load-Shedding on the Performance of Small, Medium and Micro Enterprises in Gqeberha, South Africa.” Management and Economics Research Journal 8, no. 4 (2022): 1–8.

Phiri, James. Electricity Demand and Load Shedding: Impact on Zambian Business: A Case Study of Selected Solwezi Based Businesses. LAP LAMBERT Academic Publishing, 2018.

Pretorius, Ilze. “Impacts and Control of Coal-Fired Power Station Emissions in South Africa.” North-West University (South Africa), Potchefstroom Campus, 2015.

Rahn, Maike. “ Factor Analysis: A Short Introduction, Part 5–Dropping Unimportant Variables from Your Analysis.” South Africa Web, April 9, 2021.

Rathi, Anusha. “Why South Africa Is in the Dark, Again, Foreign Policy.” Ghana Web, June 17, 2022. https://foreignpolicy.com/2022/07/08/south-africa-energy-crisis-eskom-power-cut/.

Ringle, Christian M, Sven Wende, and Jan-Michael Becker. “SmartPLS 3. SmartPLS GmbH, Boenningstedt.” Journal of Service Science and Management 10, no. 3 (2015): 32–49.

Robert, S., and S. Karen. “The Impact of Load Shedding on SMEs’ Profitability: A Study of South African SMEs.” Journal of Small Business Management 58, no. 3 (2020): 773–99.

Rud, Juan Pablo. “Electricity Provision and Industrial Development: Evidence from India.” Journal of Development Economics 97, no. 2 (2012): 352–67.

Sarosa, Samiaji. “The Role of Brand Reputation and Perceived Enjoyment in Accepting Compulsory Device’s Usage: Extending UTAUT.” Procedia Computer Science 161 (2019): 115–22.

Schoeman, Thea, and Michael Saunders. “The Impact of Power Outages on Small Businesses in the City of Johannesburg.” In 10th International Conference on Education, Business, Humanities and Social Sciences Studies, Vol. 19, 2018.

Shyu, Chian-Woei. “Ensuring Access to Electricity and Minimum Basic Electricity Needs as a Goal for the Post-MDG Development Agenda after 2015.” Energy for Sustainable Development 19 (2014): 29–38.

Tshangana, Venny. “ Eskom Has Become a Big Factor as Well as Power Outages.” South Africa Web, March 12, 2022. https://scontent.fcpt2-1.fna.fbcdn.net/v/t39.3080.

Uppal, Karan. “Creation of Smart Energy.” Business Connects 1, no. 2 (2018).

World Bank. “Small and Medium Enterprises (SMEs). Improving SMEs’ Access to Finance and Finding Innovative Solutions to Unlock Sources of Capital,” 2020. https://www.worldbank.org/en/topic/smefinance.

Zwane, Faith N, Lindie Du Plessis, and Elmarie Slabbert. “Analysing Employers’ Expectations of Employee Skills in the South African Tourism Industry.” SA Journal of Human Resource Management 12, no. 1 (2014): 1–9.

ABOUT AUTHOR(S)

Lelethu Mantangayi is a lecturer at Walter Sisulu University, Butterworth Campus, where she is committed to advancing knowledge and fostering student success. Her research interests focus on Business Management and the development and sustainability of Small and Medium Enterprises (SMEs). Passionate about community impact and academic excellence, she brings a thoughtful and driven approach to both her teaching and research. Lelethu has presented at the Multi-Inter-Transdisciplinary Conference (MITC).

Obert Matarirano is an Associate Professor of Business Management at Walter Sisulu University, South Africa, with over 17 years of experience in higher education. He holds a Doctor of Commerce (DCom) in Business Management and is an NRF-rated researcher. His work spans teaching, research, and postgraduate supervision. His research focuses on corporate finance, digital transformation in education, and higher education development, particularly the adoption and use of technology by students and academic staff in resource-constrained environments. He is committed to innovative teaching, curriculum development, and student success, actively mentoring postgraduate students. Prof. Matarirano has presented at national and international conferences, published in peer-reviewed journals, and participated in collaborative research projects. He continues to contribute to initiatives that promote quality teaching, inclusive education, and research excellence.

Dr Cuthbert Muza is a Senior Lecturer in Management Accounting and Finance at Walter Sisulu University and a certified professional accountant with over 10 years’ experience in academia and practice. He holds a PhD in Environmental Management Accounting (Stellenbosch University), an MCom in Accounting (Midlands State University), and a BBA in Accounting (Solusi University), with research focused on sustainability in extractive industries. He teaches undergraduate and postgraduate courses, supervises master’s and doctoral students, chairs the departmental research committee, and serves on faculty committees, including CIMA. He is also active externally as an examiner, moderator, and peer reviewer, and has published and presented at regional and international conferences. His research interests include environmental management accounting, sustainability reporting, public sector financial management, and forensic accounting. He is a member of PAAB(Z), CPA(Z), and the Institute of Certified Forensic Accountants (Canada), and holds additional qualifications in postgraduate supervision (Rhodes University) and education and training (City & Guilds, UK).

TO CITE ARTICLE

Mantangayi, Lelethu, Obert Matarirano, and Cuthbert Muza. “The Effect of Load Shedding on the Performance of Small-Scale Restaurants in Mthatha, South Africa – An Assessment.” E-Journal of Humanities, Arts and Social Sciences 7, no.2 (2026): 536 – 554. https://doi.org/10.38159/ehass.2026729