Help SMEs grow -SME Compete-
SME Compete, a company that is involved in the mentoring of small to medium enterprises(SMEs), has once again stressed the need for both the public and the private sector to help small busineses to grow into larger establishments.
Danny Meyer, the Director of SME Compete says the importance of SMEs in job creation and wealth creation should not be under-estimated, and as such SMEs should be assisted to venture into foreign markets to help their businesses grow.
“Firstly, government knows that wealth and job creation will come from the SME sector, so now the spotlight is firmly on promoting an enterprise culture and entrepreneurship through SME support programmes.”
Because of the importance of SMEs in economic development, Meyer says the public sector support to the development of SMEs was now being complimented by the private sector.
“This is why you find organisations like SME Compete actively promoting wealth and job creation. Business sector representative bodies like the Namibia Chambers of Commerce and Industry, Namibian Employers Federation and the Namibian Manufacturers’ Association also have programmes in place. Additionally, tertiary institutions that include The University of Namibia, The International University of Management and The Polytechnic through the Namibia Business Innovation Center also routinely promote entrepreneurship.”
He says this is crucial as SMEs need support from various stakeholders.
Meyer says ways must be explored, developed and put in place to make Namibia the most conducive environment in sub-Saharan Africa for conducting business. He suggests incentives be extended to local entrepreneurs so that they can compete on a level playing field with foreigners.
This, according to Meyer, can be achieved in many ways and not only by reducing tax rates which is often described as the best option.
“Granting rebates in the form of double tax deductions for training or upgrading the skills of employees, granting vouchers with favourable repayment terms and reduced interest rates so that the entrepreneur can buy plant, equipment and tools needed to diversify business from retailing into manufacturing, funding for marketing and to produce marketing material can all help entrepreneurs to be more competitive,” he says
Meyer adds that it is also important to sponsor business visits to neighbouring countries with the aim to enter the export arena.
Meyer believes that nothing hinders SMEs from growing and becoming large firms, provided focus is not lost and the strategy to create wealth is in place.
“Challenges that entrepreneurs, irrespective of the size of the business, routinely encounter as they go about business are not unique, they are faced by the owners of small and large enterprises all over the developing world.”
Meyer says such challenges come in numerous forms, shapes and sizes including access to funding, access to affordable work space, access to markets, shortages of skilled employees as well as cost of doing business.
Although SMEs often use lack of funding as an excuse for developing, Meyer advises entreprenuers to look at other ways to help their businesses grow.
“Other business growth options that entrepreneurs could explore include seeking venture capital and entering into business partnerships with investors. For short term needs, suppliers can be approached. They might be willing to extend credit, provided the entrepreneur has built a solid business relationship with that supplier and demonstrated seriousness and commitment.”
Meyer urges governement and the various municipalities across the country to urgently provide affordable work space which entrepreneurs can move to as they grow their business to the next level as they have to move out on current incubation centres in order to make room for other upcoming SMEs.