Small and Medium-sized enterprises famously known by the SMEs abbreviation contribute much to the economy of a country. A company worth millions can be classified as an SME depending on the personnel limit and the overall turnover generated. Most SMEs have less than 250 workers as the human capital limit. The definition of an SME is vital especially in the access of financial power from lending institutions.
There has been a wary scenario regarding the SMEs in the East African Community (EAC) region especially in Kenya where the enterprises are not given much attention by the governments. Deloitte, an audit firm released a report that SMEs in East Africa country Uganda have a greater potential to expand their business marks if they can be given more attention. The banking sectors have shifted their focus slowly but gradually to the SMEs direction with promising results in the future.
The audit firm recorded 20% contribution to the Uganda’s gross domestic product (GDP) made by the SMEs. 80% of the manufactured products in the country are courtesy of the SME firms. This has shed light on the importance of these firms in the economy in terms of revenue and job opportunities. Depending on the size of the firm, there is absolutely a good opportunity to cultivate an entrepreneurial culture within the personnel who gain experience in their work journey.
According to a recent survey by Hillmarc Consulting, banks and other financial institutions have over the last few years been restructuring their services and products to match and meet the needs of the SMEs in a bid to keep them on board. One of the greatest challenges faced by the SMEs is accessing funds but that is set to change. New reformations and customary changes for easy access of funds by the SMEs are on the way and this will be a huge bolster in Kenya and the East Africa region as a whole.
Taken to be a sample, the SMEs play a crucial role in the business environment as they encourage potential investors to come in and inject capital in fruitful projects. Sometimes they prove to be a task to handle but with the use of sophisticated technology, a team of highly qualified staff and a crystal clear management system they thrive above the hurdles. Established co-operate businesses do not shy off the SMEs title as now they are the trending businesses making a mark in the market.
It is believed that the SMEs represent 90% of all the businesses in the European Union (EU. Their recognition is another stamp that they are equally vital and competitive as the other firms. Developing countries like Kenya have encouraged investors and entrepreneurs to invest in these franchises with their impact being magnitude in most economies. With the technological advancement in this age and time, SMEs seem to be the favored business ventures to be in the spotlight.
To achieve maximum efficiency with the SMEs, the personnel need to be at their best and deliver more than required. It is a matter of sacrifice to keep them on a lifeline for the competitive market. A Growth analysis needs to be done to ensure that there is progress and potential room for expansion. In order for economies to grow SMEs come in handy and they are the enterprises to watch. In near future, their importance in technology, economy and job creation will be a beacon of hope for what they have to offer in a buffet of opportunities.