The Sunday Mail
Small and Medium-sized Enterprises can benefit from crumbling big businesses as they enjoy robust working capital as compared to their giant counterparts, economic analysts have said.
Many companies have shut down in recent years due to a variety of challenges chief amongst them dwindling working capital, a situation which experts say SMEs can take advantage of.
Experts also say more funds should be concentrated on budding businesses rather than pumping fortunes into ailing big companies, some of which are heavily in debt and will cost a fortune to revive.
Economic expert and The Sunday Mail columnist Mr Chris Chenga said SMEs were not being afforded fair opportunities to compete because Government and lenders were focusing their attentions on previously big businesses.
“SMEs can take advantage of the struggles being faced by the big companies, they can actually lift the economy because they require relatively low working capital as compared to established businesses, so they remain afloat easier.
“They can service the clientele which was being serviced by some of the companies which have closed down.”
Mr Chenga said some SMEs were being prevented from performing to their potential.
“It is unfortunate because small businesses are not being given a big enough platform; for example big companies — even those performing badly — get first preference when it comes to loans. We are saying it should be fair and based on performance.
“Lobby groups should do more to make sure that the issue is addressed. We also want them to lead the realignment of certain policies for instance you will realise that businesses which promote importing are being funded more than businesses which promote exports”
Mr Chenga also said SMEs should diversify in order to avoid redundancy and maximise their businesses.
He forecast a fruitful year for SMEs in 2015 saying the extension of the tax amnesty would particularly benefit them.
Research shows that the viability and prosperity of SMEs depends on the effectiveness of private-private partnerships.
This requires policy makers and other stakeholders whose duty is to deploy resources to sectors which need them to develop their policy formulation and implementation skills through craft literacy and craft competence courses, seminars, symposia and workshops.
