Chronicle Editor
Sikhulekelani Moyo
SMALL to Medium Enterprises (SMEs) could play a key role in helping Zimbabwe substitute imports if they are given adequate support to boost their production capacity and enhance quality standards, an official has said.
Despite having sound business ideas and expertise, most SMEs still struggle with obtaining financial support from banks, getting adequate working space and accessing lucrative markets, among other challenges.
Upcoming Bulawayo-based packaging company, Fantol Enterprises, is one of the high-potential young businesses that require more support in order to make a breakthrough.
Since its establishment in 2017, the company has been operating at the former Hunyani Paper and Packaging building in Belmont, where it is producing packaging boxes of all sizes.
Sales and marketing executive, Mr Solomon Maketani, said the company has the potential to employ many people and produce large quantities of boxes but is being limited by inadequate raw materials, which are mainly imported from South Africa.
“As SMEs, what can help us is funding to bring in raw materials because now we cannot do orders without being paid first so that we can source material,” he said.
“This company started in 2017 with about seven employees, but now we have scaled down to five due to financial constraints. We cannot source finance from banks through loans because we are still small and bank rates are too high for us.”
Mr Maketani said as SMEs they tend to turn down big orders from large companies due to a shortage of resources and that hinders their growth as they continue to take small orders, which come once in a while.
He said all things being equal, they need to source big machinery to produce their own raw materials, which will reduce import expenses.
Fantol Enterprises is producing boxes for different local companies operating in diverse sectors. Mr Maketani said the company was facing financial constraints, which hinder its ability to produce its own raw materials and meet market requirements.
Following positive feedback after participating at the recent Zimbabwe International Trade Fair (ZITF), he said the company was optimistic about improved business.
“The best way SMEs can help, not just our small business but the whole sector is by supporting each other. It would be really beneficial if other SMEs would order their packaging material from us and cut on imports.
“We also procure what we need for our businesses from other SMEs, and that will assist the sector to grow,” he said.
“If we could get Bulawayo companies to buy from Bulawayo SMEs, it would help us to grow. What would also help is SME platforms that are effective in linking suppliers and consumers, that way the exposure will help expand our small business.”
Industry and Commerce Deputy Minister, Raj Modi, is also on record calling for increased stakeholder support towards facilitating the growth of the SMEs sector.
Modi said local buyers and business people should procure goods from local SMEs, which will assist them to grow and create more jobs for the locals and also be able to increase capacity and expand to the regional and international markets.
SMEs have also been appealing to Government departments to buy goods from local producers, which include their leather products and detergents to mention but a few.
The Government has already come up with a formalisation strategy and SME associations have been conducting awareness campaigns calling upon their members to formalise and register their operations. — @SikhulekelaniM1.
Online Reporter