The Sunday Mail
Trade Focus
Allan Majuru
“If you want to go fast, go alone. If you want to go far, go together.” This adage aptly captures a key strategy that will drive the country’s exports, particularly small-scale players.
There is growing realisation that small businesses and smallholder farmers play an important role in the economy and development of communities.
Apart from contributing to economic activities, these small businesses also have the potential to export their products and services.
However, given the nature of their economic activities and economies of scale, they often struggle to compete because of high costs inherent in the export business.
As a result, in most cases, they are unable to participate in global trade, which limits their contribution to the country’s export growth.
In cases where they do participate, their activities remain informal.
To address these challenges, business associations play a crucial role in giving the much-needed support to boost exports from small businesses.
These associations form alliances to work together and improve their business performance and capacities.
For example, it might be expensive for a small business to pay for transporting goods outside Zimbabwe, but if they belong to an association, there is room to pool resources together and fund logistics required to transport the goods.
This arrangement will ensure that one small business does not bear the huge cost of transporting goods on its own and will be more competitive on the export market.
Pooling resources can also assist small businesses to develop into larger enterprises through acquisition of capital equipment that improves efficiency.
An example is that smallholder tomato farmers can come together and acquire equipment for canning their produce for export to avoid loss of product during the peak season.
Such an arrangement would ensure that farmers earn more by value-adding, hence increasing the “shelf life” of their tomatoes.
There is demand for canned tomatoes in countries such as Namibia and Angola, which an association of smallholder farmers has a greater chance of supplying than individual operations.
By the same token, small businesses that belong to an association stand a better chance of fulfilling export market demands if they aggregate their goods and supply the required quantities.
However, to ensure consistency of quality, there is need for consolidation of processes, which will ensure that the businesses produce compatible products although operating from different production facilities.
For example, one small business producing 500 pairs of shoes per week might fail to meet an order for 10 000 pairs per month.
This target can, however, be easily met if five or six similar small businesses produce the required type of shoe and export as one consignment.
This way, small businesses will have an opportunity to take part in the global export market and, over time, grow their businesses.
Additionally, entities that are members of business associations can ably interface with Government and other authorities that can facilitate an enabling environment for doing business.
Associations also have organised members that are governed by rules that help support growth.
Local associations that are already providing business-related support to their members include the Chipinge Macadamia Association, which has been active in training its members in production.
The association hosts seminars and workshops to assist their members with production-related strategies, among other things.
Members also have the opportunity for peer-to-peer learning and mentorship that allows for networking and sharing of knowledge and experience with other members.
Further, the association is currently developing a five-year plan that will cover key aspects of value addition and participation of members on the global export market.
Through the five-year plan, members expect to improve both the quality and output of macadamia nuts and increase exports to Europe, Asia and the rest of the African continent. This way, members learn global trends and explore opportunities in export markets.
The Midlands Farmers’ Hub, an association of small-scale farmers in the Midlands region (mainly around Gweru), has been working with ZimTrade in capacity building and market linkage support.
The capacity building activities include export awareness seminars that covered the foundations for export marketing, finance for exports and export documentation.
Other capacity building trainings covered requirements for organic certifications such as GlobalGAP that will make it easy for local products to penetrate the global market.
Further to this, ZUBO Trust, a member-based organisation in Matabeleland, is working towards enhancing women’s sustainable livelihoods through increased participation in economic activities.
The trust, which operates in and around Binga, has been assisting its members to develop products that have the potential to perform well on the export market.
These products include organic soap made from Jatropha, and arts and craft products such as baskets.
As world consumption patterns are becoming more skewed towards healthy living habits, the Jatropha-based soap has potential in Asia, Europe and African countries, particularly West African countries.
Modelled along the same lines is the Lupane Women’s Development Trust, which has more than 4 500 members, the largest number of organised weavers in the country.
The trust has been offering training to its members.
It also provides a platform for them to showcase their skills and benefit from local and global market linkages.
Further to capacity development, the centre assists its members with online marketing, attracting potential clients from across the world and working to ensure that their products attract the global market with ease.
Allan Majuru is the chief executive officer of ZimTrade.
