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ww.kosgeb.gov.tr SMEs & KOSGEB Small and Medium Enterprises Development Organisation ANKARA, 2012

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Page 1: Организация по развитию малого и среднего бизнеса (Министерство индустрии и торговли Турции) KOSGEB

www.kosgeb.gov.tr

SMEs

&

KOSGEB

Small and Medium Enterprises Development Organisation

ANKARA, 2012

Page 2: Организация по развитию малого и среднего бизнеса (Министерство индустрии и торговли Турции) KOSGEB

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CONTENTSGENERAL INFORMATION ABOUT TURKEYSME CONCEPTTheir Role in Economy, SME Policies, Their StrengthsSMEs IN TURKEYSME Policies, Institutional Structure, ProblemsKOSGEBFunction, Administrative Structure, Supports and Activities

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REPUBLIC OF TURKEY

783.562 m2 area,

74.7 million population (TUİK 2011),

Young population; average age: 29.7 (TUİK 2011),

76% population live in urban areas, 24% in rural areas,

World’s 17th; Europe’s 6th largest economy (IMF, 2011),

According to 2011 growth rates, second in the World.

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TEMEL EKONOMİK VERİLER 2008 2009 2010 2011

GNP (000 000 $) 742.094 616.703 734.929 766.400

GNP per capita($) 10.438 8.559 10.067 10.363Export (billion $) 132 102 113 134Import (billion $) 201 140 185 240Unemployment 11 14 11,9 10,5Infation 10,1 6,5 6,4 7,8Growth 0,7 4,8 8,9 8,5

Share of R&D Expenditure in GNP

0,73 0,85 0,84

MAIN ECONOMIC INDICATORS

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WHAT IS SME?

SME :Small & Medium Enterprises

(EU, World Bank, UN)

SMB: Small & Medium Business (ABD)

SME DEFINITIONS

Different thresholds are applied for maximum number of employees in

different countries:

-In Japan 250,

-In the USA 500,

-In Turkey 150 (until 2006, according to KOSGEB)

In some countries SMEs are defined by only financial thresholds;

-In Brazil enterprises whose annual income is less than Brazil Real of 90

million.

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EUROPEAN UNION SME DEFINITION

The most widespread definion in international area: EU

SME Definition

It is used for monitoring the rules for Competition Policy,

however every country is free in their national legislation.

(Financial threshold is regarded for public aids. )

CategoryNumber of Employees

Annual Revenue

or

Annual Balance of Payments

Medium < 250 ≤ € 50 million ≤ € 43 million

Small < 50 ≤ € 10 million ≤ € 10 million

Micro < 10 ≤ € 2 million ≤ € 2 million

WHAT IS SME?

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Backbone of Economy;

-99.8% of enterprises in EU (EUROSTAT)

-90% of enterprises in developing countries (Peter Pang, BIS)

Their most remarkable characteristic is creation of employment;

- In the USA 47 % of employment (OECD)

- In China 50 % of employment (Peter Pang, BIS)

- In EU countries 77 % of employment (EUROSTAT)

- In Brazil 62 % of employment (IBGE)

THEIR ROLE IN ECONOMY

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Major source of Value Added in Economies;

- In EU Countries 58% of total value added (EUROSTAT),

-In Japan 53% of total value added (Japan Ministry of Internal Affairs),

- In South Korea 51% of total value added (OECD)

High investment potential;

- In Japan 40% of total investment

- In the USA 43% of total investment

THEIR ROLE IN ECONOMY

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Flexibility in decision making mechanisms,

Enthusiasm of managers for growth and entrepreneurship,

Eagerness for innovation,

Faster adaptation to changes in market and technology, compared to

large enterprises,

Better knowledge of local markets due to physical closeness to

customers,

Specialisation in products, increasing product diversification,

Resistance to economic fluctuations due to high share of owner’s equity

STRENGTHS

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Between 1945-1970:

-Policies directed to large enterprises to eliminate the effects of 2nd World War and ensure capital accumulation.

Importance of SMEs are realised by policy makers after economic problems such as Oil Crisis of 70s and unemployment in 80s.

Because,

-SMEs are less affected by problems compared to large enterprises.

-They make important contribution to business and employment creation. Not only Western but also developed Far Eastern Countries (Taiwan,

South Korea), owe their industrial development of today to their dynamic, SME oriented industries.

Globalisation:

-Modern SME Policies: Entrepreneurship, innovation, environment, energy,

-European Union SME Policies

SME POLICIES IN THE WORLD

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SME POLICIES IN THE WORLD

SME POLICIES IN EU

Objectives:Drawing attention to SMEs potential in entrepreneurship and

employment creation,Establishing entrepreneurship culture,Improving business environment (technical and administrative,)Providing new financial sources,Encouraging innovation and R&D activities,Increasing awareness and capabilities in environment and energy,SME Definition: 1996 and 2003,Europe Small Enterpirises Charter: 2000 (Principles),EU Small Business Act: 2008 (Principles and Applications),Community Programs: CIP, 7FP (Applications and Financial Support)

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Ministry of Science, Industry and Technology

Regulation in Definition, Qualifications and Classification of Small

and Medium Sized Enterprises

Small and Medium Sized Enterprise (SME): Enterprises which employ less than 250 employees, and whose annual net sales revenue or financial balance of payments do not exceed 25 million TL and classified as micro enterprise, small enterprise or medium scaled enterprise according to this Regulation

SMEs IN TURKEY

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SME DEFINITION IN TURKEYhas been harmonised with EU definition in 2006.

SMEs IN TURKEY

CategoryNumber of Employees Annual Revenue or Annual Balance

of Payments

Micro 1-9≤ 1 million TL ($ 570.000)

≤ 1 million TL ($ 570.000)

Small 10-49≤ 5 million TL ($ 2.9 milyon)

≤ 5 million TL ($ 2.9 million)

Medium 50-249≤ 25 million TL ($ 14.3 million)

≤ 25 million TL ($ 14.3 milyon)1TL=$1,75 (2012)

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SMEs in TURKEY

(TUIK 2008)

DISTRIBUTION OF TURKISH ENTERPRISESON SCALE BASIS

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SMEs in TURKEY

SECTORAL DISTRIBUTION OF ENTERPRISES

(TUIK 2008)

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IMPORTANCE of SMEs in

TURKEYSMEs in TURKISH ECONOMY

Number of SMEs 2.580.075 99.9 %

Number of Persons

Employed7.865.403 78 %

Generated Added Value 150 billion TL 55 %

Investment Amount Achieved

by SMEs

51 billion TL 50 %

55 % of TOTAL EXPORTS

(TUIK 2008)

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DEVELOPMENT STAGEBefore 1950’s:

-SMEs were very small and established with inadequate working capital ,

-Working with family members or craftsmanship1960’s: Growing trade activities as a result of the rise in the welfare of EEC countries, 1963: Five-Year Development Plan; approaching ‘small industries’1980’s: General re-organization of economy in Turkey, liberalization , globalization1990: Establishment of KOSGEB1996: Customs Union

-Experiencing the international competitiveness,

-Concentration of public measures2000 and beyond: EU effect

SME POLICIES in TURKEY

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Since 2003 Produced along with EU accession Develops business environment sensitive to needs of SMEs Main strategy areas;

-Supporting entrepreneurship

-Developing managerial and institutional skills of SMEs

-Paying attention to SMEs while developing business environment

-Enhancing R&D and innovation capacity of SMEs

-Helping SMEs to easier access to financial sources

SME STRATEGY AND ACTION PLAN (2011-2013)

POLICY MAKING

Essential document guidelining transitions on economic, cultural and social issues.Includes;-Mid-Term Programme (2010-2012)-Annual Programme (2012)

9.MULTI ANNUAL DEVELOPMENT PROGRAMME (2007-2013)

KOSGEB STRATEGIC PLAN

Parallel to National Papers and institutional mission;

Objective 1 : Developing managerial and institutional skills of SMEs

Objective 2 : Increasing R&D and innovation driven activities of SMEs, and ensuring that SMEs transfer them into new investments,

Objective 3 : Disseminating entrepreneurship culture to help set new firms

Objective 4 : Providing development of the organization to offer qualitative service

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ORGANIZATIONAL STRUCTURE

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INSTITUTIONS ACTIVITIES

NON-GOVERMENTAL ORGANIZATIONS

UNION OF CHAMBERS AND COMMODITY EXCHANGES OF TURKEY

Representing the private sector, providing the solidarity and the association between the Chambers and the Commodity Exchanges

CONFEDERATION OF TURKISH TRADESMEN AND CRAFTSMEN

Coordination and representation of craftsmen and artisans, vocational assessment of the members, providing vocational trainings

TECHNOLOGY DEVELOPMENT FOUNDATION OF TURKEY Supporting technology development projects

SMALL AND MEDIUM SIZED ENTERPRISES SELF EMPLOYED PERSONS AND MANAGERS FOUNDATION OF TURKEY

Declaring opinions related to the SMEs, in varied working environment

INSTITUTIONAL STRUCTURE

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? Finance and guarantee problems,? Lack of qualified human resources,? Inadequacy of capital formations for know-how and

technology investments,? Being open to the innovation but being reluctant to

implement asserting the high costs,? Lack in marketing skills,? Not making feasibility works or business plans even if they

have the entrepreneurial spirit,? Having a limited knowledge and awareness in topics such as

Industrial Property Rights, quality and environmental protection

PROBLEMS OF TURKISH SMEs

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SMALL AND MEDIUM ENTERPRISES DEVELOPMENT ORGANIZATION

Established in 1990,

Focusing only on SMEs, the unique public institution

-Providing services parallel to the economy policies of the country,

Sectors to be supported are identified by the decisions of the Council

of Ministers,

Every enterprise defined as SME is in its target beneficiary:

-A total of 2.580.070 enterprises (2008 TUİK)

KOSGEB

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Takes the National Development Plan into consideration:

-Prioritized sectors,

Takes the socio-economic roles of SMEs into consideration:

-Supporting mechanisms developed according to the geographic and

inter-regional differences,

-Improving the job creation and employment capacities.

To be a model organization in the world, which is effective in determining SME and entrepreneurship policies, which

encourages the SMEs to undertake an important role in global market

VISION OF KOSGEB

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VISION OF KOSGEB

Takes the necessities of globalization and the competitiveness into

consideration, which are:

-Increasing the exporting capacities of SMEs,

-Providing access to the valuable information and the networks,

-Internationalization of SMEs,

-Increasing the innovation levels.

Takes the modern SME policies in to consideration:

-Strong cooperation with the international institutions,

-Renovated supporting mechanisms based on the projects.

KOSGEB

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GENERAL ASSEMBLY

KOSGEB ADMINISTRATIVE

STRUCTURE

OFFICE OF PRESIDENCY –THE PRESIDENT-

UNITS DEVELOPING MODELS AND POLICY SERVICE CENTERS

MONITORING, EVALUATION AND

COORDINATION UNITS

-Meeting annually-Setting out principles of annual work plans in accordance with the Development Plan and Programs

EXECUTIVE COMITEE

Taking decisions about the budget and implementation in accordance with the principles set out in the General Assembly

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UNITS DEVELOPING MODELS AND

POLICY

-ENTERPRENEURSHIP DIVISION- REGIONAL AND LOCAL DEVELOPMENT DIVISION

-SME MARKET RESEARCH AND EXPORT PROTMOTION DIVISION

-SME TRAINING AND CONSULTANCY DIVISION-SME FINANCE RESEARCH DIVISION-PROJECT COORDINATION DIVISION

-TECHNOLOGY AND INNOVATION SUPPORTS DEPARTMENT

-Designing regional and local development models-Continuous improvement of KOSGEB Support Models-Developing new financial instruments-Providing solutions to the training and consultancy needs of enterprises-Making researches on foreign markets and the legislation-Designing SME-oriented projects or supporting projects developed by the SME-Planning supports and actions focused on Technology and Innovation

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-KOSGEB SERVICE CENTERS (75)-TECHNOLOGY DEVELOPMENT CENTERS (28)

-R&D INNOVATION COOPERATIONS (45)-TECHNOLOGY INCUBATORS WITHOUT WALL (8)

-SYNERGY FOCAL POINTS (77)

SERVICE UNITS

-Strengthening the relation between industry and public

-Provision of KOSGEB support mechanisms

-Improving the cooperation between universities and

industry

STRUCTURES WHICH ARE IN DIRECT CONTACT

WITH SMEs.

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KOSGEB SUPPORTS and

SERVICES WHO CAN BENEFIT FROM KOSGEB SERVICES?

Any SME which was established in Turkey and registered in KOSGEB

Data Base,

-Web-based system; www.kosgeb.gov.tr

-FOR REGISTRATION; Filling SME Information Form, Selection of

Service Center

635.000 registered SMEs in KOSGEB Data Base

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KOSGEB SUPPORT&SERVICES

SECTORAL DISTRIBUTION OF FIRMS IN KOSGEB DATA BASE

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SUPPORT MECHANISMS

-Cooperation activities for

the benefit of SMEs

-Activities under EU

membership process

-Projects-Laboratory

Services

MAIN OBJECTIVES

-Competitive SMEs

-Business and Employment

-Models Parallel to Economic Policies

SME CREDIT MECHANISMS

-Alternative finance model -Contribution

to National SME Finance

System -Easy access

to sources for SMEs

-Project Oriented

-For the needs and problems

of SMEs

OTHER SERVICES

KOSGEB SUPPORTS and

SERVICES

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-Manufacturing, -Management Organization,

-Marketing, -Foreign Trade,

-Human Resources, -Financial and fiscal affairs, -Information Management

Project costs to be supported are decided by KOSGEB Evaluation

and Decision Board.

-Promoting projects developed in order to attain flexible solutions to enterprise specific problems,

-Establishment of project culture and consciousness at SMEs,-Improving project making

capacity of SMEs

SME PROJECT SUPPORT

PROGRAMME

SUPPORT MECHANISMS

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Thematic Programme Based on Call: KOSGEB determines the area

for call itself.Professional Organization Project Support Programme: The owner

of the project idea determines the area.

MAIN OBJECTIVE: Ensure compliance of SMEs with

national and international legislation and the priorities

-Aiming the thematic areas at macro strategy documents,

-Taking into account regional and sectoral needs,

- Promoting professional organizations for developing

projects for the benefit of SMEs

THEMATIC PROJECT SUPPORT

PROGRAMME

SUPPORT MECHANISMS

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MAIN COOPERATION AREAS:-Supply, marketing,

-Low capacity utilization, -Weak competitiveness power,

-Finance

“Common solutions for common problems”

- At least 5 business come together to enhance their

capacity and competitiveness,- Benefiting from economies of

scale to provide resource-conserving,

-Developing cooperation culture

COOPERATION COLLABORATION

SUPPORT PROGRAMME

SUPPORT MECHANISMS

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MAIN SUPPORT ITEMS-Machinery, equipment, hardware, raw material,

-Softare and services -Staff,

-Technopark rent, Industrial and Intellectual Property Rights

- R&D Innovation Programme-Industrial Implementation

Programme

-Developing SMEs and entrepreneurs possessing new ideas and inventions based on

science and technology,-Supporting innovation activities,-Commercializing results of R&D

and Innovation Projects

R&D, INNOVATION AND INDUSTRIAL

IMPLEMENTATION SUPPORT

PROGRAMME

SUPPORT MECHANISMS

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3 SUB PROGRAMMES:- Applied Entrepreneurship

Trainning-New Entrepreneur Support-Business Incubator (İŞGEM)

Support

TARGET GROUP:-General groups-Young people

-Women -Disadvantaged groups

-Supporting entrepreneurship-Establishing successful and

sustainable businesses,-Disseminating entrepreneurship

culture,-Promoting entrepreneurship

based on local dynamics

ENTREPRENEURHIP SUPPORT

PROGRAMME

SUPPORT MECHANISMS

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ON;Domestic Fairs, Foreign Business

Travel, Promotion, Matching, Qualified Personnel, Training and

Consultancy, Energy Efficiency, Design,Certification,

General Test-Analysis, CE Marking

Target Group:-SMEs having low capacity of

developing progect-SMEs in sectors just included to

KOSGEB target group

- Enabling SMEs to produce high quality and efficient goods/services,

- Encouraging the general enterprise development activities of

the SMEs,- Promoting marketing activities of

SMEs in order to expand their domestic and international market

shares

GENERAL SUPPORT

PROGRAMME

SUPPORT MECHANISMS

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GOING-PUBLIC PROCESS-Ensuring being processed in the Istanbul Stock Exchange Market

(IMKB) Emerging Enterprises Market,

-Providing opportunity to procure funds from capital markets

- Market counselor consultancy fee, commission to intermediary fee,

-Independent auditing service fee,-Capital Market Board(SPK)

registration fee,- Istanbul Stock Exchange (IMKB)

Market Emerging Enterprises Market List acceptance fee

For the SMEs having development and growth

potential

EMERGING ENTERPRISES MARKET SME

SUPPORT PROGRAMME

SUPPORT MECHANISMS

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MAIN OBJECTIVE:Find traditional and alternative

solutions to the financial needs of SMEs in

SPECIAL PURPOSE CREDITS-Employment Credit

-Export Credit-Machinery-Equipment Credit

-Emergency Credit-Operational Capital Credit

PROCESS-Low interest rate

-Covers all the interest or a large proportion

-Possibility of long-term repayment

-KOSGEB credit guarantee for main capital

KOSGEB PROVIDES ALTERNATIVE FINANCE SOLUTIONS FOR SMEs;

-Credit Guarantee Fund is established within the partnership of KOSGEB, TOBB, 20 public and private Banks.

KOSGEB is partner of KOBI AS, serving venture capital and IVCI (Istanbul

Venture Capital Initiative).

KOSGEB CREDIT AND FINANCE MECHANISMS

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BUDGET NUMBERS

KOSGEB BUDGET (2012) 253 MILLION $

REALIZED AMOUNT AS KOSGEB SUPPORT (2011)

168 MILLION $

REALIZED SUPPORT RATIO IN OVERALL BUDGET (2011)

%69

NUMBER OF APPLICANT SMEs (2010) 12.967

NUMBER OF APPLICANT SMEs (2011) 30.000

KOSGEB BUDGET NUMBERS

1$=1,75 TL

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SUPPORTS IN NUMBERS

(2010-2011)

SUPPORT PROGRAM Number of Aplicants

Number of Approved Projects

Number of Projects Granted

Realized Support Amount

SME Project Support Programme 2,079 1,427 399 8.2 Million $

Thematic Project Support Programme 59 23 3 43.3 Million $

Cooperation&Collaboration Support Programme 116 90 42 5.6 Million $

R&D, Innovation and Industrial Practice Support Programme

2,328 1,126 1,569 23.1 Million $

Entrepreneurship Support Programme 3,45 2,716 4,133 11.8 Million $

General Support Programme 34,881 - 18,879 36 Million $

Developing Enterprises Market SME Support Programme

5 1 0 0

OVERALL 42,918 5,383 25,025 85 Million $

(1$=1,75 TL)

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KOSGEB TECHNOLOGY SUPPORTS KOSGEB TECHNOLOGY

AND INNOVATION SUPPORTS (MILLION $)

2003 1.7

2004 7.3

2005 4.6

2006 2.1

2007 1.7

2008 2.6

2009 2.5

2010 3.7

2011 11.21$=1,75 TL

NUMBER OF APPLICANTS 4,082

NUMBER OF SUPPORTED PROJECT 2255

COMPLETED PROJECTS 1,212

COMPLETION RATIO 55%

COMMERCIALIZED PROJECTS 881

COMMERCIALIZATION RATIO 73%

ACTUAL NUMBER OF WORKSHOPS 195

RATIO OF WORKSHOP FULLNESS 72,31%

Numbers belong to 1992-2012 term

NUMBER OF SUPPORTED NEW ENTREPRENEURS 881

CONTRIBUTION TO EMPLOYMENT 15257NUMBER OF COLLECTED PATENT/UTILITY MODEL BY SUPPORTED FIRMS

312

NUMBER OF SMEs MOVED TO TECHNOPARKS AFTER KOSGEB FACILITY 114

SALE VOLUME OF SUPPORTED FIRMS 494 Million $EXPORT VOLUME OF SUPPORTED FIRMS 97.5 Million $

Numbers belong to 1992-2012 term

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Support Programme for

Developing Women

Entrepreneuship

Number of İŞGEM* Number of

workshops

Number of workshops

actually occupied

Number of Current

Employment

3 73 42 72

As of December, 2011 (*İŞGEM: Business Development Center)

2010 2011

KOSGEB NEW ENTREPRENEUR SUPPORT ($) 530.455 80.347.726NUMBER OF SUPPORTED ENTREPRENEURS 134 3147

2010 2011PRACTICAL ENTREPRENEUR TRAINING 309 1389

NUMBER OF PARTICIPANTS 11.534 47.480

KOSGEB ENTREPRENEURSHIP

SUPPORT

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THEME OF CREDIT INSTRUMENT

Number of Beneficiary

Firm

Amount of Credit

Volume Assigned to

firms(Million $)

Interest covered by

KOSGEB(Million $)

Contribution to

Employment(Staff

headcount)

SME SUPPORT CREDITS

204.781 6.4 0.56 32.623

SME EXPORT SUPPORT CREDITS

SME EMPLOYMENT SUPPORT CREDITS

MACHINERY&EQUIPMENT SUPPORT CREDITS FOR FOOD INDUSTRYTRANSFER TO OIZ SUPPORT CREDITS FOR LEATHER SECTORINFORMATICS SUPPORT CREDITSSME MACHINERY&EQUIPMENT SUPPORT CREDITS MANUFACTURER ARTISANS SUPPORT CREDITS

KOSGEB CREDIT SUPPORT MECHANISMS

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SECTORAL DISTRIBUTION OF KOSGEB SUPPORTS

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DISTRIBUTION OF SUPPORTED FIRMS ON

SCALE BASIS

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PROJECT FOR IMPLEMENTATION OF SMALL BUSINESS ACT IN BALKAN COUNTRIES AND

TURKEY-Pictures actual situation of the

country in scope of the Act,-Puts efforts on building suitable

environment to SMEs with field actors

EUROPEAN SME WEEKTurkey’s coordinator in context

of SME Week run by the EU with 37 countries

ENTERPRISE EUROPE NETWORK -National Coordinator

-Manages 7 consortia of which 5 are run individually by KOSGEB,

-Brings 24 actors together for a common goal (public, university,

NGOs)

EU ORIENTED KOSGEB ACTIVITIES

OTHER SERVICES

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CO-OPERATION FIELDS -Running joint projects

-Taking part in working groups-Setting up KOSGEB Business-

Matching Centers with counterparts-Forming and signing Collaboration

Protocols

PRACTICALLY -Information&Experience sharing

-Mutual use of data bases -Organization of joint training

Sessions -Organization of seminars and

conferences

ACTORS-International, regional and

national field bodies (i.e., OECD, Black Sea Economic Organization,

Chambers, Universities) -Counterparts from target

countries

CO-OPERATION ACTIVITIES IN

FAVOR OF SMEs

OTHER SERVICES

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AIM:-Raising awareness amongst SMEs on energy efficiency, environment,

-Increasing the capacity to empower institutional and public

incentive infrasturucture,-Helping to develop a market in

above areas

-Exchanging knowledge and experience,

-Providing technical support,-Training,

-Demo/Pilot projects, and aplications,

-Analysis&Reports

-KOSGEB PROJECT FOR ENVIRONMENT ROAD MAP

-KOSGEB PROJECT FOR ENERGY EFFICIENCY PROJECT

IN SMEs

KOSGEB PROJECTS

OTHER SERVICES

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-Exchanging knowledge, expert, -Trainings for public experts and

entrepreneurs,-Recovery of job losses after

privatization,-Labs specified to Quality

Assurance (textile, shoemaking)

-EU-WORLD BANK

-GIZ OF GERMANY

KOSGEB INTERNATIONAL

PROJECTS

OTHER SERVICES

-EU MEDA PROJECTS (Completed)-PRIVATIZATION SOCIAL SUPPORT

PROJECT (Completed) -PROJECTS UNDER THE EU 6TH FP

(Completed)-STRENGHTENING ECONOMY IN ANATOLIA PROJECT (Ongoing)

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1 BILLION $ KOSGEB

SUPPORT

7.6 BILLION CREDIT

VOLUME280.000

SMEs

-50.000 EMPLOYEE-3 BILLION $

EXPORT VOLUME

BRIEFLY

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THANK YOU

www.kosgeb.gov.tr