State support essential for SMEs
Ms. Rochelle Fox
As a small business owner, I would like to bring this to the notice of all government officials in past and present government, and who have been ignoring our issues. On and off we see ministers or relevant officials discussing what actions should be taken, or what they will do. But nothing had been done so far to create a programme or even a committee to find a solution for any issues that have been raised. We are from the SME sector. As a small-scale business entrepreneur, we create jobs for either the unemployed or parents who are unable to leave their homes due to various reasons. The SME sector makes sure to supply them with a decent income to run their homes. We make sure that all taxes are paid on time to the government. But it is the SME sector that is most affected as no government body or any establishment is willing to help. There are no state-run programmes to help out the SME sector unconditionally to help them develop the business, and create more job opportunities.
To develop our organisations we have to go through a stressful process, as we do not get any bank facilities given to us since many of us in the SME sector don’t have property to mortgage or any kind of security to give. Even though we have been working with the same banks for many years, we still don’t get any kind of benefits. We run our businesses using loans from friends or family members. We have to make sure our manufacturers are paid on time; we have to purchase raw material as we do not get any credit.
But after all this is done, when we have to supply the finished goods to the retailers, we have to give them a credit period. There is no law to control the credit period, its all decided by the retailer itself which can go from 30 to 90 days. And if we don’t agree to their credit terms, we do not get orders or an income. Specially during this pandemic, retailers are using this as an excuse to not pay us for the things they bought, even though they have the money. There is no one that we can talk to and get help from. The big factories who are financially stable always have the benefit of the sale or banks to support them. But small companies or start-ups like us in the SME sector have no chance because we don’t have the financial support. The retail shop owners earn and build their business by taking goods on long term credit. As you can see many SME businesses are either closing or stating they are bankrupt for the above-mentioned reasons.
If any government in power wants to help the SME sector, they can help us through projects like Salu Sala, Laksala or any other project. This could also pave the way to reduce the unemployment rate and dependency on state funds if there are proper programmes run for the benefit of small entrepreneurs. Any government that is in power needs to put themselves in the common people’s shoes and understand the difficulties most of us are facing. Then only can we all prosper as individuals and a country.
(The writer is Director, CHC Fashion (Pvt) Ltd and owner of
clothing brand ellefoxx & Anjelo Liu)