Cedric Wilson, Guest Columnist

AS MORTALS, we are moved instinctively to worship bigness. We stand dumbstruck gazing at the mighty mountain; we are bewildered at the vastness of the oceans, and we are speechless at the imponderable immensity of space.

But, in addition to the awesome spectacle of nature and the magnificent structures that man in his quest for immortality has constructed, the economist has contributed his piece to the veneration of size.

The concept of 'economies of scale', which is important in the lexicon of the economist, has worked its way into the modern psyche, and bigness is often associated with greater efficiency.

'The bigger, the better' and 'the more, the merrier' are common expressions in everyday parlance.

Yet, in a world in which the global economy is increasingly being dominated by multi-national corporations and mega-enterprises there is a vital economic role for small and micro-enterprises, particularly for the sea of humanity at the base of the economic pyramid.

Over the last quarter century, I witnessed the development of two micro-businesses in a ghetto community of southern St. Andrew which when assessed from the point view of profitability did remarkable well, all things considered.

GENERATING INCOME

Miss Cindy was a single mother with four children. A couple years before, everything the family owned was destroyed in a fire that completely consumed the house in which they lived.

Miss Cindy was a natural fighter who believed in the values of hard work and was committed to providing a good education for her children.

In the late 1970s after trying a number of odd jobs, she started selling roast fish at the street corner opposite her home. It was a hit - the product was excellent; customerservice, exemplary. Soon, Miss Cindy had many customers, most of them from uptown who parked their fancy cars along the narrow road.

By the middle of the 1980s, Miss Cindy's two eldest sons had completed their tertiary education and she was able to buy a house uptown in the very neighbourhood of some of her clients.

Two doors up the road from Miss Cindy lived Miss Russ. She was a retiree and like most working class women had no pension.

Miss Russ started her own micro-business, she started sell 'suck-suck' (an icicle made from syrup). Nobody quite knew the ingredients she used but the children in the area loved it.

There were other 'suck-suck' vendors in the area, but the price and consistency of her product made the commodity popular.

In addition, Miss Russ was a good listener who would throw in a little bit of guidance counselling to the young and the restless.

I am still amazed at the kind of turn-over the business had because she was able to pay her rent, utility bills and take care of all her expenses.

Furthermore, if you happened to be going through a rough financial patch, Miss Russ was always in a position to give you a decent loan, if she was convinced that it was not particularly risky.

What Miss Cindy and Miss Russ demonstrate is that micro-enterprises can generate significant income and, in some situations, can provide an opportunity for social mobility.

There are several things that should be recognised about micro and small enterprises.

Firstly, they have potential of becoming large successful businesses. After all, Wal-Mart started in 1962 as a small family business in a little town called Rogers in Arkansas, USA. Now it is the world's largest retailer with annual sales of more than US$200 billion.

Secondly, micro and small enterprises tend to be more creative and the operation is as such that management is closer to the market than is the case for large corporations.

Consequently, they are more capable of tapping into the psyche of their clientele and very often produce products with higher domestic content.

CONTRIBUTE TO ECONOMIC GROWTH

Thirdly, most successful large corporations are aware that size can be a liability, and as such attempt to create small organisations within the large organisation.

This is one of the strategies Alfred Sloan, former president of General Motors used to make the organisation under his leadership, one of the most successful in the world.

Fourthly, micro and small business can, given the right structure and environment contribute significantly to economic growth and development.

In the U.S., for instance, 85 per cent of the businesses are small outfits, but nonetheless collectively they are responsible for 40 per cent of the country's Gross Domestic Product (GDP).

For Jamaicans concerned about the development of the economy, it is apparent that there is a need for more investment in micro and small enterprises.

But this will not come without challenges. The issue of providing structure to assess the credit worthiness of potential entrepreneurs, training these entrepreneurs on how to keep good records, as well as educating them in the basics of marketing and customer service is critical.

Indeed this must go hand in hand with the provision of loans for investments and the thrust to get small investors to see the link between savings and investment.

Finally, there is one other matter that must be investigated. After Miss Cindy got her house uptown her former neighbours in the ghetto prohibited her from operating her business on the corner.

This raises the question as to whether there is something in the community psyche of Jamaicans that prevent us from making the leap from smallness to bigness that truly inspires awe.

Cedric Wilson is an economics consultant who specialises in market regulations. Send your comments to: conoswil@hotmail.com.