By KC Soares, ContributorONE OF the negative features of the small business sector is its fragmentation with respect to representation.
There are far too many segments of the sector, with each being represented by its own association. For example, there is the Jamaica Agro Processors Association, the Jamaica Wood Products and Furniture Association, the Jamaica U-Drive Association, Christiana Potato Growers Association, an association for goat farmers, one for bee-keepers, another for papaya growers, and so on.
If I am given 10 pencils, I can easily break them one by one. However, if the 10 pencils are bundled together it will be very difficult for anyone to break them. This demonstrates that there is strength in unity.
Ideally then, the different associations should be a part of a main body, which could be the Small Business Association of Jamaica (SBAJ).
RESTRUCTURING
Of course the SBAJ will have to undergo tremendous restructuring if it is to play the role being proposed. In its present format, the SBAJ is ineffective and does not appeal to the majority of small businessmen and women.
Compared to the Private Sector Organisation of Jamaica (PSOJ) and the Jamaica Manufacturers Association (JMA), the SBAJ is hardly recognised as a body to be taken seriously.
However, consider the recognition it would get if all the associations fell under its umbrella. In this scenario, when the SBAJ speaks others would be forced to act. In this way the interest of all members would be projected. For instance, when there are events to be staged, instead of each individual association going it alone, the SBAJ could promote a grand exhibition of all its member associations. The bigger and more diverse the event, the smaller will be the per unit cost and the greater will be the interest. Greater interest is expected to translate into increased business for the participants.
Consider also the matter of financing, which, in general, is difficult on two counts accessibility and high interest costs. The coming together of all the associations will enhance the establishment of the financial growth fund for growing businesses that I have been proposing.
All members will pay a fee to the controlling body and part of these fees should be channelled to the fund, the bulk of which is expected to be provided by the government on a 10:1 basis. The fund should operate on the basic principle of insurance coverage but in this case the fortunate or successful business will benefit. Success will be determined by growth of the business and the mere fact that a growing business will be eligible for these funds is, in itself, an incentive to do well.
The JWPFA had an exhibition two week-ends ago at the Campion College. There were just about 10 booths and the interest from the general public was very low.
OUTCOME
Consider what would be the outcome if the proposed controlling body of the small business sector had put on this exhibition, featuring products from agro-processing, woodworking and furniture, bee-keeping, bakery and pastry, information technology, arts and crafts, apparel production, shoe-makers, the services sub-sector, transportation and the many other sub-sectors.
Surely, the unit cost per booth would be minimal, while the economic return on each booth would be significant. There would, no doubt, be adequate advertising of the event, resulting in good support from the general public as there would be something of interest to almost everyone.
With all members of the small business sector coming together as one body, it can then command prominence on the business landscape, as do the PSOJ and the JMA. As a matter of fact, I am of the opinion that this group would have far greater clout than the two organisations mentioned above. The PSOJ and the JMA tend to rally more around the large corporate entities with the small businessman rarely being recognised.
Unity is strength and it should be remembered that there are many more small businesses than large corporate entities. A uniting of all small businesses in an environment where funds are readily available for growth will result not only in a most powerful representation of the sector but also in sustained economic growth and development.
K.C. Soares is a former banker and now a business consultant with Soledad Financial Services Limited. E-mail: soledad@netcomm-jm.com.
