SMEs identified as backbone of the economy

Nana Tweneboa-Boateng, Chief Executive Officer of EMPRETEC Ghana Foundation, at the weekend classified Small and Medium-sized Enterprises (SMEs) as the backbone of all economies and constitute the dominant form of business organisations.

"SMEs served as key source of economic growth, dynamism and flexibility in advanced industrialised countries, as well as in emerging and developing economies," Nana Tweneboa-Boateng stated at the end of 10-day capacity building workshop for entrepreneurs in Accra.

The workshop organised by EMPRETEC dubbed: as a flagship training programme aimed at building the entrepreneurial competencies of SMEs operators, to build high quality, growth-oriented, internationally competitive entrepreneurship and offer business advice, and access to technology and finance to the private sector.

The 25 participants, were from various sectors, namely food processing, services, construction, Information Communication Technology (ICT)

He described SMEs as the hallmark for the introduction of innovative products and techniques in to the market, adding: "Most giant companies today started off in
typical SME fashion, as a dream developed by a young enterprising man or woman with the help of family and friends.

"While not every small business turns into a multinational, they all face the same issue in their early days - finding the money to enable them to start and build up the business and test their product or service.

Nana Tweneboa-Boateng queried: "why is it harder for SMEs to borrow money from banks or to find private investors than for larger firms? This are important questions given the fact that small businesses, and particularly innovative SMEs, become increasingly
vital to economic development and job creation as the knowledge-based economy develops.

The EMPRETEC Chief Executive noted that in recognistion of the vital role of SMEs the Government had placed many catalytic interventions to benefit the private sector
through the creation of the enabling business environment for the development of the private sector.

It therefore requires of the players in the private sector to take advantage of the many opportunities and initiatives to set up, or improve your businesses, the windows of competitive opportunity does not open for too long, Nana Tweneboa-Boateng stated. He debunked the notion that money and technical skills were the key ingredients to the success of businesses.

He said: "While money and technical skills are important in business, they are not the determinants of success. More important to the success of a business is the right attitude and their associated behaviours.

"Without the right attitudes and associated behaviours, money and technical skills will not lead to success."

The EMPRETEC Chief Executive expressed concern about many entrepreneurs who set out to exploit a business opportunity without developing a road map
for the enterprise in the form of a business plan.

People could develop great ideas, ideas have equally great values but unless ideas were supported by and executed with knowledge, flair, confidence, commitment, passion
and the right attitude, the enterprise would fail.

He noted that many SMEs start out as an idea from
one or two people, who invested their own money and probably turn to family and friends for financial help in return for a share in the business.

But if they are successful, there comes a time for all developing SMEs when they need new investment to expand or innovate further. That is where they often run into problems, because they find it much harder than larger businesses to obtain financing from banks, capital markets or other suppliers of credit, Nana Tweneboa-Boateng stated.

"This "financing gap" is all the more important in a fast-changing knowledge-based economy because of the speed of innovation," he said.

Innovative SMEs with high growth potential, many of them in high-technology sectors, have played a pivotal role in raising productivity and maintaining competitiveness in recent years.

But innovative products and services, however great the potential, need investment to flourish. If SMEs cannot find the financing they need, brilliant ideas may fall by the wayside and this represents a loss in potential growth for the economy.

Many start-up businesses according to Nana Tweneboa-Boateng had failed because the great ideas conceived could not be translated into reality with the requisite knowledge and the right attitude.

Nana Tweneboa-Boateng advised SMEs to be realistic in their projections and decisions while aggressively pursuing the set goals and targets...begin to recognize problems as opportunities and take advantage of it, network among yourselves and the bigger business community to increase your production capacity and sales.