How the present ‘dumsor’ is impacting the digital economy

By: Dr Andrews Ayiku 

Since February 2024, Ghana has experienced frequent power outages, sometimes known as “dumsor.”

These power interruptions have had a huge impact on many different sectors of the economy, including online enterprises. As e-commerce and digital marketing have grown in popularity in Ghana, many firms have moved their activities online in order to reach a broader audience and increase revenue.

However, Ghana’s unpredictable power supply has been a significant obstacle to many internet firms, reducing production, profitability, and overall success. Intermittent blackouts not only affect daily operations for these organisations, but also result in cash losses and reputational damage.

In this article, I will explore six ways in which power fluctuations are affecting online businesses in Ghana and provide practical examples to illustrate the impact of dumsor on the digital economy.

Operational disruptions
Power fluctuations have a huge impact on online firms in Ghana, affecting their everyday operations. Many online businesses rely on electricity to power their computers, servers, and other vital equipment for functioning. When power outages occur unexpectedly, many firms are unable to access their systems, execute orders, or interact with consumers.

This might result in product delivery delays, missed sales opportunities, and a loss of money. For example, a small e-commerce store selling handmade jewellery may rely on electricity to run its website, online payment system, and inventory management software. If the power fails during peak shopping hours, the business may be unable to fulfil orders, resulting in unsatisfied consumers.

Decreased productivity
Power outages can also have a negative impact on online enterprises in Ghana. Employees may be unable to work on their laptops, access vital papers, or connect with coworkers if the power goes out. This can lead to lost time, missed deadlines, and reduced overall efficiency. A digital marketing organization, for example, that relies on energy to power its computers and internet connection may find it difficult to meet client deadlines if the power fails unexpectedly. Employees who do not have access to their systems may be unable to work on marketing campaigns, analyze data, or contact with clients, resulting in lower productivity and missed business possibilities.

Increasing operational costs
Power fluctuations also have an impact on Ghana’s online enterprises by increasing their operational costs. Many businesses are required to invest in alternate power sources, such as generators or solar panels, to ensure a steady supply of electricity during dumsor seasons. These added costs can place a strain on internet businesses’ finances, particularly small and medium-sized enterprises with limited resources.

A software development company, for example, that relies on energy to power its servers and development tools may need to invest in a generator to provide constant power supply during power outages. The expense of purchasing and maintaining the generator can have a substantial influence on the company’s bottom line, lowering profitability and ability to invest in growth possibilities.

Equipment Damage
Power fluctuations can potentially harm equipment for Ghanaian internet businesses. Power surges and oscillations from an unstable energy supply can damage computers, servers, routers, and other electronic devices. This can lead to expensive repairs or replacements, adding to the financial burden of online enterprises.

A web hosting company, for example, that relies on energy to operate its servers may suffer equipment damage because of power surge. This can result in website outages, data loss, and significant legal liability if consumer information is compromised. The expense of repairing or replacing damaged equipment can be enormous, affecting the company’s capacity to provide dependable services to their customers.

Dissatisfaction among customers
For Ghanaian internet enterprises, power fluctuations can also cause client unhappiness. When the power goes out unexpectedly, clients may be unable to access the companies’ websites, place orders, or contact customer service. This can lead to irritation, bad feedback, and a loss of confidence in the brand.

For example, an online apparel company that endures regular power outages may struggle to complete orders on schedule, resulting in consumer complaints and refund requests. Customers who are unable to contact the company’s customer care service during a blackout may feel abandoned and decide to purchase elsewhere in the future.

Ghana’s power fluctuations, or dumsor, have a substantial impact on the country’s online enterprises. Unreliable power supply is a significant challenge for online firms attempting to survive in the digital economy, causing disruptions, decreasing productivity, increasing operating expenses, and harming equipment. By tackling the underlying causes of dumsor and investing in alternate power sources, the Ghanaian government and businesses can collaborate to provide a more reliable electricity supply and promote the country’s digital economy growth.

Dr Andrews Ayiku
Lecturer/SME Industry Coach
Coordinator (MBA Impact Entrepreneurship and Innovation)
University of Professional Studies Accra
IG: andy_ayiku
F: Andyayiku

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