adminThe announcement of the new Cabinet comes as relief to our markets, which have been jittery due to the uncertainty in the country prior to the announcement. The new Cabinet is expected to follow through the election manifesto and election promises made by Zanu-PF during the elections as evidenced by the appointment of what can be described as a revolutionary Cabinet given its revolutionary credentials and background.
It appears the West intends to keep sanctions in place, therefore, the new Cabinet has to be creative and innovative in creating jobs, employment and release liquidity from the country’s natural resources.
An area that needs attention is the micro- enterprises sector.
This sector is now the country’s biggest employer and source of livelihood for a majority of Zimbabweans.
This area requires formal recognition, financial and infrastructural support.
A micro-enterprise (or micro-enterprise) is a type of small business, often registered, having five or fewer employees and requiring seed capital of not more than US$35 000.
The term is often used in Australia to refer to a business with a single owner-operator, and having up to 20 employees.
The term micro-enterprise connotes different entities and sectors depending on the country.
Generally speaking, in developed countries, micro-enterprises comprise the smallest end (by size) of the small business sector, whereas in developing countries, micro-enterprises comprise the vast majority of the small business sector — a result of the relative lack of formal sector jobs available for the poor.
These micro-entrepreneurs operate micro-enterprises not by choice, but out of necessity.
Characteristics of micro-entrepreneurs
According to a 2000 study commissioned by Accion USA, a non-profit organisation and the largest micro-lending network in the US, there are 13,1 million micro-entrepreneurs across the country.
By definition, a micro-entrepreneur is an individual who owns/operates a micro-enterprise.
Micro-entrepreneurs start their business for two primary reasons: because they need income or they need a job and/or because they love to do the kind of work their business requires and have a special skill in that area.
Often, micro-entrepreneurs provide a very special product or service that is particularly appropriate to his or her community.
Micro-enterprises add value to a country’s economy by creating jobs, enhancing income, strengthening purchasing power, lowering costs and adding business convenience.
Because micro-enterprises typically have little to no access to the commercial banking sector, they often rely on “micro-loans” or micro-credit for finance. Micro-finance institutions often finance these small loans, particularly in the Third World.
Those who found micro-enterprises are usually referred to as entrepreneurs.
The terms micro-enterprise and micro-business have the same meaning, though traditionally when referring to a small business financed by micro-credit the term micro-enterprise is used.
Similarly when referring to a small, usually legal business that isn’t financed by micro-credit, the term micro-business is used.
Micro-enterprises in developing countries
In developing countries, micro-enterprises comprise the vast majority of the small business sector — a result of the relative lack of formal sector jobs available for the poor.
Micro-enterprises in developing countries, then, tend to be the most frequent form/size of business.
As explained by Aneel Karnani in the Stanford Social Innovation Review (summer 2007), “Micro-finance misses its mark”, most micro-credit clients are not micro-entrepreneurs by choice.
They would gladly take a factory job at reasonable wages if it were available. We should not romanticise the idea of the “poor as entrepreneurs”.
The International Labour Organisation uses a more appropriate term for these people “own-account workers”.
Micro-enterprise and micro-lending
A micro-enterprise is a sole proprietorship, partnership or family business that has fewer than five employees.
It is small enough to benefit from loans under US$35 000 and generally too small to access commercial banking services.
Micro-enterprises are a subset of small businesses (which can have up to 500 employees and still be considered “small”).
But, in the majority of micro-enterprises, the owner is the sole operator and worker, leading many to refer to this phenomenon as self employment.
Although these two terms are often used interchangeably, self-employment refers to the status of the business owner while micro-enterprise refers to a very small business.
The size and type of production of these businesses varies considerably, however, they generally have a few common characteristics:
Job Creation
Most micro-enterprises create employment for the owner and often other family members.
Local market
Micro-enterprises serve the needs of their neighbours and their communities.
Micro-enterprises span a wide range of business types, of which most are within the service or retail sector.
The University of Montana Research and Training Centre on Rural Issues for People with Disabilities has documented that entrepreneurs with disabilities have successfully operated a wide variety of micro-businesses.
These include accounting service, air-condition repair service, auto body repair shop, bakery, chiropractic practice, counselling service, real estate office, restaurant, and welding shop.
Financial planning for your micro-enterprise, a publication developed jointly by the National Endowment for Financial Education and the Association for Enterprise Opportunity, is aimed at entrepreneurs who want to develop and strengthen their personal and business financial management skills.
The publication focuses on various topics which include personal budgeting, the use and misuse of debt, building financial assets, and cash flow and breakeven analysis.
Micro-enterprise development
Micro-enterprise development is a social service industry around the world comprised of micro-enterprise development organisations.
The organisations are typically non-profit entities that assist individuals to start very small businesses.
The benefit of working with a micro-enterprise development organisations is their experience serving low-income, minority and disadvantaged populations.
Micro-enterprise development organisation
Micro-enterprise development organisations provide assistance and training to individuals interested in starting or expanding a micro-enterprise.
Organisations vary, but the majority offer business planning assistance, group trainings, and customised assistance to prepare clients for business ownership.
Many of these organisations focus services on low-income individuals, minorities and disadvantaged populations.
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