Monrovia – The Country representative of BRAC Liberia, Aisha Nansamba, has stressed the importance of empowering the country’s Small and Medium Enterprises (SMEs), which she said constitutes about 98 percent of the country’s business entities.
Report By J.H. Webster Clayeh, [email protected]
BRAC Liberia has been operating in Liberia since 2008 with two entities [BRAC NGO & BRAC Liberia Microfinance Company Limited (BLMCL)]and has its presence in ten counties providing access to microloans, interventions in Food Security and Livelihoods, Education, Health, Empowerment and Livelihoods for Adolescents and Ultra Poor Graduation as means of alleviating poverty through a “holistic integrated approach”.
With support from IDRC & UK AID, BRAC Liberia held a one-day conference to discuss the findings of a recent study which was conducted among BRAC SMEs clients in the country.
The launch of the study finding was held at the Bella casa Hotel on November 6.
The Managing Director of BLMCL, Mr. Gonondo, speaking at the event, emphasized that for the country to resuscitate from the current economic crisis, the least person doing business in the country needs to be empowered.
“The Small and Medium Enterprise is the engine of development. Indeed, they need to be empowered,” Gonondo stressed. He said while SME remains the engine for our development, we also need to provide soft skills to enable our sellers increase their customer service approach which will lead to more sales of goods.
“Sometimes our approach to customers drives them away leaving our goods packed on the shelves, while on the other hand a customer could spend all of their money buying even what they didn’t intent to buy only because of our approach to them” he said. The research was essential as its result will help government and its development partners plan programs for our SMEs.
At the same time, Augustine Flomo, Liberia’s Deputy Finance Minister for Economy and Debt Management, added that every economy that wants to be sustainable should prioritize SMEs.
“For those small businesses, they need the necessary framework to help them survive. They create lots of jobs and they are known to be the engine of any economic growth,” said Minister Flomo, who also said capacity building for SMEs is the key for nation building.
He called on SMEs to take advantage of every opportunity that comes their way and improve on their businesses.
“If you want to put out a challenge of supporting the economy and you want to be recognized, you have to play your role. If you identified the area you want to work in, you have to do it with commitment in order for your success rate to be good,” he said.
For his part, Dept Minister for Technical and Vocational Training for Youth and Sports, Peter Bemah said, the policy will impact SME once it becomes actionable backed by the will of all parties. He said most of our training has been one sided and so we must diversify them while looking at mentorship of our youth.
These can provide great incomes for our youths while reducing the burden of employment by government as government can’t employ everyone. He further emphasize that one of our critical challenge under the T-vet is the regulatory framework which looks at capacity building programs in a systematic way.
“The regulatory framework will determine how we start and end our businesses. Businesses need to see themselves as partners, considering every policy as their own. Government is working with its partners on the business climate to bring back the Liberia better business platform which looks at ideas of making the policy actionable and setting up timeline to measure its impact,” he said.
Edward Belleh, Director for Access and Finance of the Ministry of Commerce emphasized the inclusion of module on business management, in particular; marketing, planning, papcking and labeling.
“The substance of a commodity can never stand out as long as that commodity is not well packaged or labelled to attract customers. Today no one wants to buy chips or water in an ordinary bag because it is been done better,” he said.
In addition, we must train our youth in value addition, this will help them make money in different ways from a single product.
Presenting the findings of the study, BRAC Liberia Country Representative Aisha Nansamba highlighted the significant decline in the performance of SMEs due to the effect of the Ebola Virus disease outbreak. As well as “Inadequate business skills and knowledge are some critical challenges to the SMEs’ sector that Liberia has identified.
The research findings revealed the relevance of training in interpersonal relations alongside the various business management skills like; budgeting, records keeping, branding, marketing, planning, and financial management among others to enhance the performance of the SMEs.
She added that the report is based on an impact evaluation conducted with technical support from Partnership for Economic policy (PEP) team and financial support from IDRC & UK AID. The research followed a randomized control experiment to assess the effect of interpersonal skills relative to business management training for SMEs’ business performance and customers’ loyalty and satisfaction.
Random samples were taken out of 577 SMEs, who are microfinance borrowers under BRAC’s Small Enterprise Program (SEP). The sample members were randomly assigned into three groups.
In group one, firm owners were given business management skills training at a one-day work-shop.
In group two, firm owners attended a two-days training [one day for interpersonal skills training and another day for business management skills training], while group three was assigned to receive no training at all, to serve as the comparison group. A baseline survey with the firm owners from all three groups was conducted.
Then the business start-up Centre, a local organization with expertise in providing training to SMEs, provided the training to group one and two. Business management included topics on; Business motives and principles, Basic accounting and records maintenance, Budgeting and expenditures management, Savings Promotion, Marketing, and Financial Negotiation. The interpersonal skills entailed modules on; knowing oneself and knowing and serving customers.
The team conducted the follow-up survey and in-depth interviews six months after the training sessions to find out its effect.
Meanwhile, rolling out the policy message, Madam Nansamba disclosed that there was more increment (45%) in revenues for owners who received additional training on interpersonal relations.
She then stressed that the result indicates that taking a “customer-orients” approach can be an effective way to improve business performance.
“These findings demonstrate the potential value of training to improve interpersonal relations and customer care. As such, this type of training should be included in entrepreneurial skills programs aiming to enhance the performance of small businesses,” Madam Nansamba said.
“Policymakers should encourage the inclusion of soft skills training in the formulation and reformulation of the SMEs policy.”