sme-development, from the point of view of local authority and business community

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SME-development, from thepoint of view of local authority

and business communityNorth-South Conference, Mwanza

November 2009

ONDANGWA-LEMPÄÄLÄ-KEETMANSHOOP-KANGASALAPartnership For Local Democracy, Development And Social Innovation

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CHAPTER 1:

-Profile of SME-sector

in Ondangwa and Keetmamshoop, based on survey 2008

-National policy of LED-functions in a Local Authority

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JOB CREATION

Majority of enterprises have maximum 5 employees

It is important however to recognise the importance of job creation in smallest 1-3 person enterprises

18

8

28

12

19

19

0

9

36

17

16

22

0 10 20 30 40 50

Nobody

1

2 - 3

4 - 5

6 - 10

11 - 190

Amount of respondents, pcs

Keetmanshoop, n=104 Ondangwa, n=100

5. Number of employees

4

BUSINESS SECTORS6

27

14

1

8

3

14

0

4

0

1

12

5

5

33

14

3

5

5

14

0

0

18

4

3

1

13

7

32

0

0 10 20 30 40 50

Wholesale

Retail

Hospitality

Transport

Telecommunication service

Other Service to business

Other Service to consumers

Education/training

Health/social work

Manufacturing

Building / Construction

Agriculture

Other

Metal / car repair / panelbeating

Electrical appl. repair, installation



6. Field of activities

Pcs Keetmanshoop OndangwaTextile, clothing, accessories 10 9Carpenter, furniture, home decoration 9 4Building materials 8 2Other manufacturing industry 5 3N 32 18

It is positive to recognise the number of manufacturing enterprises but there may not be need to emphasise any specific business activity in reference to the others

o It may be more important to focus on factors of job creation, local value addition, profitability and sustainability

o Promoting social innovation and public-private partnerships of services may contribute the economic growth significantly

Manufacturing enterprises:

5

TURNOVER?7

18

3

23

6

13

10

1

9

22

16

26

7

10

4

1

0 20 40 60 80 100

10 000 or less

10 001 - 50 000

50 001 - 100 000

100 001 - 500 000

500 001 - 1Million

1 - 3 Million

3 - 20 Million

20 Million or more



Annual turnover (Missing estimated by monthly turnover * 12)

Average:o Keetmanshoop 1 785 452

o Ondangwa 1 373 843

o There were more manufacturing enterprises in Keetmanshoop and the enterprises are a bit older

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AVAILABILITY OF LABOUR

Need for employment office services should be considered

42

17

23

22

28

29

18

25

0 10 20 30 40 50

Very difficult

Rather difficult

Rather easy

Very easy



12. How difficult/ easy it is to find workforce

7

START-UP CAPITAL63

6

0

27

2

3

75

14

1

12

2

14

0 20 40 60 80 100

By savings

Withfamily's/friends

help

Loan fromfriends/neighbours

Loan from bank

Grant/loan ofdevelopment

institution

Other



18. How did you raise your start-up capital

Financial services for smaller enterprises clearly need development

o Lack of collaterals may be the main issue!

o Business plans and innovations as collateral could be considered as a modern instrument

18. 2. otherFreq.

Family loan 1Finnish Financial Institution 1From another business 1Husband's help 1Inherited. 2Loan from NDC 1Loan from a supplier 1

Loan from the members/stakeholders 1Overdraft from the bank. 1Owners contributions 1Sold thier old business 1Some capital come from salary 1Started selling few clothes 1Steiner Group 1Used the pension money. 1With help of a supporting project. 1Total 17

8

EASY ACCESS TO CAPITAL?

High interest rates may be affecting growth of business

Lack of collaterals make it difficult to raise capital

21

26

12

45

1

25

37

37

0 20 40 60 80 100

Very easy

Rather easy

Rather difficult

Very difficult



19. How easy is the access to capital nowadays

9

MAIN PROBLEMS OF ENTERPRISES

0

5

10

15

20

25

30

35

40

HR/STAFF DEMAND FINANCE SECURITY/THEFT PREMISES ELECTR/WATER MATERIAL TRANSPORT DEBTS

10

INFLUENCE OF LOCAL AUTHORITY

Majority of enterprises feel that Local Authority should have more influence / cooperation / interaction with the enterprises!

4

33

67

10

40

52

0 20 40 60 80 100

Too much

Enough

Too little



22. How much does Local Authority influence your enterprise

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HOW SHOULD LOCAL AUTHORITY SUPPORT SME’S?36

36

30

47

39

12

14

28

23

28

43

39

44

19

0 20 40 60 80 100

Support for start up enterprises

Advisory support

Advisory assistance on finance

Consultancy on town planning andpremises

Investments on premises forbusiness

Training

Other

Amount of respondents, pcsKeetmanshoop, n=85 Ondangwa, n=98

23. What kind of support would you prefer to have from Local Authority

Keetmanshoop;o Town planning, infrastructure, start-up

support, advisory support

Ondangwa; o Training, Town planning and infrastructure,

start-up and other advisory support

Microsoft Excel -taulukko

What k ind of training Keetmanshoop OndangwaBusiness management 3 21Accounting and finance 4 6Marketing, customer management 1 11Staff training, vocational training 5 6Legislation, regulations 0 4IT 1 5Other 0 4Total 14 57N 13 44

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MINISTRY OF LOCAL GOVERNMENT WHITE PAPER ON SME-SUPPORT= Basic LED-functions of a Local Authority

OPEN MARKETS SHOPPING CENTRES AND MALLS SMALL BUSINESS INFORMATION UNITS (WITH NCCI, JCC, ODC) PARTNERSHIPS; Industrial parks, business service providers,

Vocational Training Centres COOPERATE WITH COMMERCIAL BANKS ENCOURAGE ACQUIRING FREEHOLD TITLES FOR COLLATERALS REVIEW REGULATORY ENVIRONMENT FOR BUSINESS ATTRACT VISITORS AND TOURISTS ATTRACT INVESTMENTS LAND USAGE FROM THE POINT OF VIEW OF BUSINESS ENVIRONMENTAL PROTECTION FROM THE POINT OF VIEW OF

BUSINESS, MANUFACTURING ETC… IDENTIFICATION OF MARKETS COMPARATIVE ADVANTAGES

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CHAPTER 2:

Local Economic Development

Functions of Local Authority;

Ondangwa & Keetmanshoop

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ENABLING ENVIRONMENT

LED officer, in cooperation with CEO shall promote cooperation between the Town Council and the business community and he/she shall:

o Establish/Create of LED advisory committee• The committee shall discuss eg:

– Comments land allocation issues from the business point of view

– Local Economic development/growth strategy

– Any problems on any sector, between business community and Local Authority

– Any other upcoming LED-related issue

o Develop and implement a Local Economic Development Strategyo Advise Council on issues that affect LEDo Promote and encourage a positive relationship with other stakeholders i.e.

MTI,NCCI, Regional Councilso Enhance capacity in the local physical infrastructure.

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RESEARCH AND DEVELOPMENT

Collecting, interpreting and analysing data that will influence future priorities and actions;

Undertake and analyse appropriate research to establish the needs and opportunities of local businesses and the local economy

Develop a strategy of finding resources for research and planningo Eg networking with other institutions

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SME-DEVELOPMENT

Encouraging and supporting SME development o Advise sme’so Facilitate / coordinate advising, training and mentorship of new and existing

sme’so Facilitate technical support

Facilitate SME business access to markets Develop and manage informal trading Creation and management of business information and innovation

centre

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FACILITATE FINANCE

Identifying business funding opportunities Securing external funding support to undertake local developments Monitoring the management of external funding for Local Economic

Development re-generation Lobby in commercial banks on behalf of the sme’s

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PROMOTION OF INVESTMENTS

Marketing and promotion of investment opportunitieso Web-site, brochures, get editorial material published

Develop and promote tourism opportunitieso Establish tourism information centre

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WITH CROSS-CUTTING STRATEGY:

Shall promote and encourage networking, cooperation & innovativeness for growth, job creation and diversification of the business community

sme-development, from the point of view of local authority and business community

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